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Thursday, 29 September 2016

CPA raises concerns that MNOs are setting conditions on additional airtime offered in pricing of recharge cards

The Consumer Protection Agency (CPA) is opposed to some of the conditions that mobile network operators have placed on additional minutes of airtime it is offering as part of the 10% increase in prices of mobile recharge cards, Al Borsa reports. MNOs have reportedly restricted the additional airtime usage to calls made to their own networks, CPA’s head Atef Yakoub believes that MNOs do not have the right to impose such restrictions on consumers which could constitute “profiteering on taxes,” a crime carrying a 5-7 year prison sentence. Yakoub has raised these concerns with the National Telecommunication Regulatory Authority (NTRA). As we noted earlier this month, the NTRA and MNOs have reached an agreement to raise the price of phone recharge cards 10%, 6 ppt of which will go towards the value-added tax (VAT), while the remaining 4 ppt will go to the consumer in the form of additional airtime. On a related note, retailers of these cards are reportedly continuing to raise prices well above the new pricing system in the absence of a clear mechanisms that factor in their profit margins, according to the newspaper.

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