Zain Iraq suffers interconnection suspension from Asiacell

Iraq’s telecom regulator, the Communications and Media Commission (CMC) has ordered all of the country’s operators to stop interconnections with Zain Iraq’s "unlicensed lines".

Earlier this year the CMC accused Zain Iraq of using five million SIM cards without regulatory approval. The regulator handed Zain Iraq a US$262 million fine, to be paid by April 11.

In a letter sent to all of Iraq’s three mobile telecom operators on February 17, the CMC stated that no company had the right to activate or market any new line without the commission’s prior consent. It also requested that all telecom companies cease interconnections with unlicensed lines or face legal action.

Zain’s problems escalated this week with an announcement from its main rival Asiacell, saying that it had already disconnected its "frame relay" with "several million" Zain Iraq lines that are alleged to be unlicensed.

"The CMC stressed that neither Zain nor any other company may activate or market any new line without the commission’s prior consent," Asiacell said in a statement.

"The CMC also requested that all telecom companies immediately discontinue their interconnection with unlicensed lines under threat of litigation. Based on these directives, Asiacell has disconnected these lines to avoid legal ramifications."

Asiacell added that it also "retained the right" to demand compensation from Zain Iraq. It said that Zain Iraq had damaged Asiacell’s market position by distributing "millions" of unlicensed SIMs.

Zain Iraq responded to Asiacell’s announcement by saying that it "regretted" its rival’s decision to stop interconnections with the disputed SIM cards.

Zain added that its legal team was preparing "formal challenges" to the CMC ruling and the US$262 million fine.