Summary

Facts

RCP (an ISP) offered a terminal (APLIO) that allowed users to communicate with one another when connected to the Internet. This equipment consisted of a modem with software that allowed for voice over Internet communications.
The incumbent fixed operator (Telefónica del Perú) presented a complaint to the Ordinary Collegiate Body of the regulator (OSIPTEL) for unfair competition for unlawful infringement of regulations. According to its complaint, RCP was offering long distance telephony without the required licence, obtaining a competitive advantage by establishing low prices to the detriment of operators that have a licence for long distance services.

Decision

The CCO did not uphold Telefónica´s complaint.

Reasoning

For the CCO the practice did not qualify as an act of potential unfair competition, but could be analyzed as illegal competition. According to the CCO, the service provided by RCP qualified as a value-added service, which did not require a licence (concession). Moreover, RCP was registered as a value-added company as required by law. The service was considered as value-added since it only allowed for APLIO-to-PC and APLIO-to-APLIO voice communications, and required both end users to be connected to the Internet when using APLIO. Furthermore, APLIO communications did not qualify as telephony because they did not comply with the regulatory definition of telephony services; in particular, their provision did not directly generate revenues for the operator. The service provided by RCP consisted only of the routing and transmission of data packages using IP, while the users were free to purchase any terminal that permitted communications to other Internet users.