South Africa‘s Vodacom Group and MTN Group could face prosecution if they do not agree with the Competition Commission in the next two months to lower data prices, the watchdog said in findings from an inquiry published on Monday.
By 15:32 the share prices of both companies were down around 4%.
The data services inquiry was launched in August 2017 in response to a request from the minister of economic Development and after complaints from consumers about high data costs.
In its final report, the Commission recommended that the two mobile operators must independently reach agreement with the competition watchdog on substantial reductions on tariff levels, especially prepaid monthly bundles, within two months of the release of the report.
It said the preliminary evidence suggests that there is scope for price reductions in the region of 30% to 50%.
The mobile operators must also reach agreement “to cease ongoing partitioning and price discrimination strategies that may facilitate greater exploitation of market power and anti-poor pricing.”
“With respect to the above recommendations on the level and structure of pricing, should an operator fail to reach the required agreements with the Commission within the specified timeframes, the Commission will proceed to prosecution under the appropriate sections of the Act,” The Commission said in a summary of its report.