Digicel appeals $50,000 Panama fine

DIGICEL, THE mobile phone group controlled by Denis O’Brien, has been fined $50,000 in Panama for imposing charges on customers who wanted to change mobile phone networks.

The company said yesterday it has appealed the fine.

“We anticipate that the matter will be resolved in our favour,” a spokeswoman for Digicel told The Irish Times yesterday. “Digicel subsidises phones in Panama. Under the terms of the porting agreement in Panama, Digicel is entitled to recover some or all of that subsidy in the event that the customer moves to another network.”

The Panamanian regulator ASEP (National Authority of Public Services), imposed the fine after customers complained that Digicel demanded a payment to unblock their phones. The authority found that the company had not properly informed customers at the time of buying a phone that the unit had a subsidised price and that a fee would be payable if the contract was cancelled within the first six months of the phone’s acquisition.

ASEP introduced new rules on portability in November 2011. This is the first time the regulator has imposed a fine on a mobile phone provider. Digicel entered the Panama market in 2008, where it is the third largest operator.

The mobile phone group operates in more than 30 markets around the world, in countries across the Caribbean, Central and South America and the south Pacific.

Last month, the regulator in El Salvador rejected a plan by Digicel to sell its business in El Salvador to a company owned by Mexican billionaire Carlos Slim – the second time in 18 months that the deal had been rejected.

The transaction dates back to March 2011, when Digicel agreed to acquire America Movil’s Claro business in Jamaica and to sell its businesses in El Salvador and Honduras to the Mexican company.

Digicel increased its revenues by 14 per cent to $2.54 billion (€2.04 billion) in the year to the end of March 2012.