Andinatel, Pacifictel sue authorities over Cuenca license

Friday, November 28, 2003

Ecuador's state-run fixed line operators Andinatel and Pacifictel have filed a lawsuit against the telecoms regulator Conatel and the comptroller general, claiming the award of a spectrum license to Cuenca-based operator Etapatelecom was illegal, local daily El Comercio reported.

Andinatel and Pacifictel claim the license should have been awarded through a public auction process, and also claim that a December 2002 strategic agreement with Etapatelecom parent company Etapa is not valid.

Cuenca mayor Carlos Castro dismissed the lawsuit as absurd given that former President Gustavo Noboa signed the concession contract as a witness. Castro also pointed out that Andinatel and Pacifictel themselves obtained concessions without a public auction.

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The lawsuit appears to confirm Etapa's fear that the recent offer by Andinatel and Pacifictel for Etapa to buy a 6% stake in their mobile joint venture Telecsa would be a completely new arrangement, not necessarily abiding by the interconnection and roaming clauses spelled out in the December 2002 agreement.

Telecsa is scheduled to launch on December 1, with coverage of Quito and Guayaquil, and has already pre-sold more than 500,000 lines. The opening promotion promises a rate of US$0.10 a minute for on-net calls for the first 15 years, during which Telecsa will also absorb interconnection fees for calls to other operators.