Conflict of Interest in the Merger - ICCC Boss and Mahesh Patel
by PNGBLOGS STAFF WRITERS
It seems ICCC is in bed with Telikom’s Chairman Mahesh Patel on the so called merger of Telikom, Bmobile and DataCo issue. A number of key points for the public to note here:
- Telikom Board’s term of office has expired. As such, Telikom effectively has no Board to act on its behalf at the moment until a new Board is sworn in. How can Mahesh Patel claim to be speaking on behalf of the Board when insider information has it that there has never been a Board Meeting convened for this purpose? He therefore is acting alone, and for whose interest? Clearly, if you link the dots together, it would be in the interest of the team: The Prime Minister Peter O’Neill, Mahesh Patel himself, John Mangos and Michael Donnelly, the ousted CEO of Telikom PNG.
- This article has it that Mahesh, the Chairman of Telikom PNG went into discussions with ICCC boss, Mr. Paulus Ain. How can he, Mahesh, discuss the merger while acting as the Chairman of another State-owned, Telikom that is at equal footing with Bmobile and DataCo? He cannot pursue this alone as he has no right to, under his current capacity. His new purported role as the Chairman of Kumul Communications is not legitimate as he has initiated a number of NEC Submissions to make him the Chairman but all have been done in haste with multiple errors noted.
term ‘merger’ is wrongly applied here. Only Telikom and Bmobile would
merge to form Telikom Mobile DataCo would remain a wholesale bandwidth
provider in this new arrangement. However, the public must know that
Mahesh Patel drafted a second NEC Submission and changed a number of
decisions taken by NEC in NEC Decision 360/2016 to suit his personal
interest and of course, of the team as well. What he changed was:
- To now merge the three SOEs (Telikom, Bmobile and DataCo) together and Telikom PNG would maintain control under his Chairmanship.
- Since the KCH Act calls for only two expatriate Directors, he quietly removed the Chairman of Bmobile Board and kept only himself and John Mangos in the new Board.
- He revoked the appointed of Mr. Moses Tedumo, a qualified national to position of Acting CEO of Telikom PNG.
- He appointed Michael Donnelly, the outgoing CEO of Telikom PNG to remain and serve his term so that Michael can easily become the Managing Director of Kumul Communication, replacing John Mangos in due time ahead.
- Mr. Paulus Ain was formerly in charge of Regulatory functions in Telikom PNG before being appointed as the CEO of ICCC therefore the public must know that a possible conflict of interest in the whole deal may exist. The Commissioner need to be prudent in handling this matter, in the interest of the consumers and the industry at large.
- It is understood the Mr. Ain was a senior manager of ICCC as well during the time when competition in the telecommunication industry was introduced into PNG. He was all for competition and did numerous submissions to Government that successfully went against Telikom in its attempt to stop competition. Mr. Ain was a strong advocate for competition and hopefully he remains true to his cause in this evil merger proposition.
- Mr. Ain must be reminded here that this move is anti-competition. Telikom must NOT be a vertically integrated company that would perform wholesale and retail functions together. There must be clear cut accounting separation between the retail and wholesale businesses. Otherwise it will continue to offer unfair pricing to its customers. It would lower its rates, not pay for wholesale bandwidth it offers its retail business while excessively charging its competitors for the wholesale bandwidth it offers them. Its current practice in business is so unfair and anti-competitive already so how much better will it become in the new proposed restructure? Messrs Patel and Ain must make that clear to the public and other service providers.
- The country is aware that PNG DataCo was to have provided wholesale-only services in the industry and the rest of the service providers would come and buy the bandwidth at the same price regardless of the competition. At least, this is a good start for a fair and just delivery of much needed bandwidth to grow the industry and economy of Papua New Guinea. Why are we killing this idea so soon? Isn’t this move in itself is anti-competitive? When is the government going to provide cheaper internet and data services to our schools and health services that are in desperate need of these services?
Given these seven points, it appears that whole deal of merging the state telecommunication companies is not a viable approach for national development but one that is focused on enriching a few greedy and evil people. Sadly, the country is again denied its aspirations of improved education, health and social services. Delivery of government services that depend very much on telecommunication and IT platforms would be affected as important government business gets passed onto private hands courtesy of our Prime Minister Peter O’Neill and his club mates – Mahesh Patel (Fijian), John Mangos (New Zealander) and Michael Donnelly (Australian).