Initiation of administrative proceedings against Kcell for alleged abuse of its dominant position

Almaty, 26 October 2018 - Kcell Joint Stock Company (“Kcell” or the "Company") (LSE, KASE: KCEL), the leading provider of mobile telecommunications services in Kazakhstan, notifies that on 19 October 2018, the Committee on Regulation of Natural Monopolies, Protection of Competition and Consumer Rights of the Ministry of National Economy of the Republic of Kazakhstan (“Committee”) initiated administrative proceedings against the Company for an alleged administrative violation related to the abuse of its dominant position in 2017. The potential fine, which can be imposed by the court, constitutes approximately KZT 2 billion.

According to the Committee, the violation resulted in the establishment of different prices for Kcell’s mobile Internet access service with a data allowance, when the data allowance was exceeded or the monthly subscription fee was not paid in a timely manner. 

In addition, the Committee issued an order for the Company to return to Kcell brand subscribers all fees charged in 2017 when the monthly data allowance was exceeded and when the monthly subscription fee for mobile Internet access services had not been paid. Kcell has filed an appeal against this decision with the court.

Kcell maintains that the practice of charging for data usage that falls outside a pre-agreed data allowance is in line with international telecoms industry practice and therefore disputes the Committee’s actions. The Company will provide an update on this situation in due course.






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