Vodacom is being investigated by the Competition Commission for a tender it won with the National Treasury to provide cellphone contracts to 20 government departments, notes a TimesLIVE report. The telecommunication company was to be the exclusive provider of contracts to staff of at least 20 departments from September last year until 2020. The commission has said this exclusive contract may contravene the Competition Act and was the possible abuse of a dominant position.

The commission had said it could result in a loss of money for other mobile providers and entrench Vodacom's dominant market position.

The commission noted: ‘The Competition Act prohibits a dominant firm from abusing its dominance by requiring or inducing a supplier or customer to not deal with a competitor and engaging in an exclusionary act that impedes or prevents a firm’s entry or expansion within a market‚ unless the firm concerned can show technological or other pro-competitive gains which outweigh the anti-competitive effect of its act.’

A Moneyweb report quotes Vodacam CEO Shameel Joosub as saying the mobile operator followed due process in bidding for the government contract. The Treasury also defended the contract, according to a report in The Times, saying it was aimed at saving money rather than having individuals or individual departments negotiating mobile contracts.

Treasury said: ‘The procurement process to appoint a service provider took approximately 18 months‚ and included various consultations with key stakeholders‚ being government departments and the mobile network operators themselves’.

Vodacom was awarded the contract because it offered the lowest prices.

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