Privy Council ruling clears FTC to resume challenge of Digicel, Claro merger

The way has been cleared for the Fair Trading Commission (FTC) to continue its challenge of Digicel's 2011 acquisition of Claro.

That same year, the FTC filed a claim in the Supreme Court after it completed an investigation into the Digicel-Claro merger.

The FTC claimed that the merger would not be beneficial to consumers and that it had jurisdiction over the telecommunications industry.

Digicel took the matter to the appeal court which ruled in December 2014 that the FTC does not have the jurisdiction to intervene in the merger.

However, the Privy Council has now overturned that ruling.

The FTC says the law lords considered three main issues and ruled in its favour on all three.

In particular, the Privy Council held that the FTC has the jurisdiction to intervene in the telecommunications market as it does in other markets.

It further ruled that section 17 of the Fair Competition Act governing anti-competitive agreements applies to mergers and acquisitions.

The Privy Council also held that the FTC’s jurisdiction was not affected by the approval of the agreement between Digicel and Claro by the relevant Minister under the Telecommunications Act.

According to the FTC, this judgment now allows it to resume its challenge in the Supreme Court of Digicel’s acquisition of Claro.

The decision also allows for the disposition or sale of an asset in the merger, or instituting behavioural remedies to adjust whatever anti-competitive effects may be experienced.