ISLAMABAD: The Pakistan Telecommunication Authority (PTA) has approved the merger of Telenor Pakistan with Pakistan Telecommunication Company Ltd (PTCL), while imposing strict conditions to prevent abuse of market power and force the new entity to invest in upcoming spectrum auctions.
The PTA believes that these measures are necessary to ensure fair competition in the telecom sector, especially given PTCL’s dominant position in the market.
In line with an earlier decision of the Competition Commission of Pakistan (CCP), the PTA has also treated PTCL and its mobile arm Ufone (Pak Telecommunication Mobile Ltd, PTML) as separate legal entities, prohibiting any cross-subsidization between them and requiring maintenance of separate accounts.
Cross-subsidization is the practice of using profits from one product, service, or customer group to fund another that is losing money or sold at a lower price.
In an order issued on Thursday, the PTA approved the merger of Telenor Pakistan, Telenor LDI Company (TLDI) and Orion Towers, which operates Telenor’s radio base towers, with PTCL (collectively referred to as “notifying parties”).
New operator excluded from exclusive agreements, discriminatory prices and cross-subsidies
However, the new mobile operator formed by Ufone and Telenor Pakistan has been designated as “MergedCo” by the PTA.
The order has been signed by PTA President Hafeezur Rehman, Finance Member Muhammad Naveed and Compliance and Enforcement Member Dr Khawar Siddique Khokhar.
The PTA said the notifying parties and MergedCo shall maintain separate and detailed accounts for all business units, in accordance with prescribed standards.
Given PTCL’s status as the largest telecom service provider, the regulator has prohibited it from entering into agreements, directly or indirectly, or exclusive deals that prevent other licensees from acquiring bandwidth from PTCL to serve their own customers. All liabilities and obligations relating to Telenor Pakistan, TLDI and Orion Towers will be borne by PTCL. The notifying parties and PTML/MergedCo, individually and collectively, have also been directed not to introduce or modify brand names without the prior written approval of the PTA.
PTCL and FusionCo will not be allowed to discriminate between other telecom operators in matters related to interconnection for local or international termination. Their prices may not be used in a manner that prevents or restricts access by other operators to PTCL or MergedCo customers, and no preferential treatment will be given to their affiliates or subsidiaries.
The PTA has banned cross-subsidization between PTCL and MergedCo and directed both to maintain transparent pricing structures for wholesale and retail services. PTCL will not cross-subsidize its retail or downstream services through revenue derived from upstream services, nor offer unreasonably low or predatory prices intended to exclude competition in any market.
The order also states that the merged company must participate in upcoming spectrum auctions to improve coverage and resolve capacity issues.
Published in Amanecer, December 5, 2025.
