Vodafone under investigation

THE Competition Authority is investigating a complaint levied against Vodafone by retailers angry at the slashing of margins on top-ups for ready-to-go phones.

Vodafone rejects the allegations by RGDATA that reducing commissions on some ready-to-go options from 10% to 6.5% is in breach of the competition acts.

A Vodafone spokesperson said a similar complaint last year was not upheld by the authority.

RGDATA argues that the margin cut was introduced despite previous assurances from Vodafone to retailers that investment in the electronic terminals would ensure protection of their margin.

Vodafone says it does not deal directly with retailers but use distributors like Easons, An Post and Alphyra, adding that the reduced commission of 6.5% is on a par to commission paid by the National Lottery.

The RGDATA complaint alleges that Vodafone has been in breach of the competition acts “It is ironic that on the same day that Vodafone slashes the margin for top up services paid to retailers, they simultaneously make a €44.4m payment to the ODTR for new licences. Retailers have played a pivotal role in the success and roll out of Vodafone/Eircell in this State, but are now expected to endure cutbacks to fund Vodafone's increased dominance in the marketplace in Ireland.

“The Vodafone cutback comes at a time when retailers are facing ever-increasing costs which will hit them hard. We are confident that the Competition Authority will take action to prevent Vodafone from behaving in such an abusive and anti competitive manner.”

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