MWeb loses internet case against Telecom

THE latest legal battle in Namibia’s fiercely-contested internet services market ended in a defeat for MWeb Namibia and a victory for the State-owned Telecom Namibia in the Supreme Court on Monday.

In a case which it first lost in the High Court, and has now also lost on appeal in the Supreme Court, MWeb Namibia was trying to have a section of the Posts and Telecommunications Act of 1992 declared unconstitutional. The company further tried to stop Telecom Namibia from delivering ASDL internet services to the public without the fees for these services being prescribed in terms of the same law.With the appeal, MWeb Namibia also wanted the Supreme Court to prohibit Telecom Namibia from continuing to provide ASDL services to MWeb at the same price that the parastatal is charging the public for the same service, and to instead offer ASDL services to MWeb at lower, wholesale prices.The section of the Posts and Telecommunications Act, whose constitutionality MWeb Namibia was questioning, states that no person other than Telecom Namibia may conduct a telecommunications service, except under the authority of a licence granted by the Namibia Communications Commission (now the Communications Regulatory Authority of Namibia).In part of its arguments in the appeal before the Supreme Court, MWeb’s objection to that section of the Act was summarised: ‘While Telecom is free to roam around beating its monopolistic drum, MWeb does not only have to apply (and pay) under a pain of criminal penalty, for a licence; but once such a licence is granted, MWeb becomes subject to the jurisdiction of Government’s specially created watchdog (the Namibia Communications Commission). The unequal treatment is stark, the reasons for such inequality wholly obscure.’The Constitution’s guarantee of equality and of protection against discrimination is not an absolute guarantee, though, Acting Judge of Appeal Fred Chomba pointed out in the judgement handed down on Monday.In the judgement, MWeb’s appeal against the High Court’s decision in its case was dismissed with costs.Chief Justice Peter Shivute and Acting Judge of Appeal Johan Strydom agreed with the judgement written by Acting Judge of Appeal Chomba.In terms of the Act, Telecom Namibia was given the responsibility of providing telecommunication services throughout Namibia, regardless of the profitability of these services, and in effect is required by law to perform what had been State functions previously, Judge Chomba reasoned.MWeb, as a private company, has the freedom to choose whether to enter into the business of providing internet services, and of choosing where to provide such services, the judge added.Judge Chomba stated: ‘(B)y virtue of their respective responsibilities, which are unequal, it would be unreasonable to treat Telecom and MWeb equally. Their interrelationship is a typical demonstration of the settled view taken by the courts that equality before the law is never absolute and therefore that you cannot treat equally persons who are not equals. ‘Telecom has an enormous responsibility of providing services countrywide to the well-to-do as well as to the financially vulnerable and in doing so it has no choice. On the contrary, MWeb, as a private company, is profit orientated and therefore can choose its operational areas to suit that orientation.’Judge Chomba expressed his sympathies for MWeb’s argument that Telecom Namibia was unfairly competing with MWeb by charging its own direct customers the same fees for ASDL services as it is charging MWeb for the same services, which MWeb then also provides to its own clients.However, taking into account the historical context in which Telecom Namibia was created to provide telecommunications services to all of Namibia, it becomes clear that a law which may appear to have a monopolistic effect in economic terms and therefore to be contrary to the public good when viewed simplistically, was in fact designed to promote the public good, Judge Chomba remarked.MWeb Namibia was represented by Esi Schimming-Chase and senior counsel Raymond Heathcote with the appeal, which was heard in October 2008. Susan Vivier and the, then senior counsel, Dave Smuts represented Telecom Namibia, while Nixon Marcus appeared for the Minister of Works, Transport and Communication, the Minister of Trade and Industry, and Government.

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