CCP Approves PTCL–Telenor Merger with Strict Conditions

The Competition Commission of Pakistan (CCP) has conditionally approved Pakistan Telecommunication Company Limited’s (PTCL) acquisition of Telenor Pakistan and Orion Towers, setting the stage for one of the most significant telecom shake-ups in the country’s history. The approval comes with more than 20 stringent conditions designed to safeguard consumers, curb anti-competitive practices, and ensure transparency in market conduct.

A Two-Phase Merger

The deal will unfold in two stages:

First, a vertical merger between PTCL and Telenor Pakistan, followed by the consolidation of Ufone and Telenor’s mobile operations into a single entity, MergeCo. Once complete, MergeCo will hold a 32.8% share of Pakistan’s mobile market, placing it firmly behind Jazz at 43.1% but ahead of Zong at 24.1%.

Governance and Oversight

To prevent conflicts of interest, PTCL and MergeCo are required to maintain entirely separate boards and management teams. No individual may serve in both entities, and a three-year cooling-off period will apply before an executive can switch sides. Senior leadership must demonstrate telecom expertise, turnaround experience, and integrity, while their performance will be evaluated against key metrics such as profitability, cost efficiencies, and network expansion. Oversight will be handled by an independent Third-Party Reviewer (TPR) appointed for five years to audit records and report directly to the CCP.

Transparency and Fair Play

Financial dealings between PTCL and MergeCo must be conducted on an arm’s length basis, with quarterly reporting to the TPR. Sharing sensitive commercial information or cross-subsidization is strictly prohibited. PTCL will also need PTA’s approval for wholesale pricing of services such as IP bandwidth and leased lines, a move aimed at preventing predatory practices. The CCP also flagged past instances where PTCL charged Ufone higher rates, warning that such conduct will no longer be acceptable.

Consumer Protection and Market Access

The new framework compels MergeCo to provide fair access to Mobile Virtual Network Operators (MVNOs) and maintain existing contracts with Telenor LDI and other telecom operators for at least three years. Any changes to BTS sites, towers, or infrastructure will require PTA approval. To ensure competition, PTCL must also offer non-discriminatory interconnection capacity to rival operators.

Balancing Market Power

The merger creates a telecom giant with dominant positions across multiple markets by controlling 44.6% of Pakistan’s towers, 43.2% of the LDI segment, and 33.9% of the long-haul fiber network. While this concentration raised concerns, the CCP argued that efficiencies such as spectrum consolidation, 5G acceleration, and fiber expansion could deliver long-term benefits if closely monitored. PTCL and MergeCo will be required to prove all efficiency claims with verifiable data and demonstrate how gains are passed on to consumers.

CCP Concludes

Perhaps most importantly, the CCP has retained the right to revoke the merger or even direct divestitures if the merged entity is found engaging in anti-competitive practices. This safeguard makes clear that the regulator intends to keep the new telecom powerhouse in check.

The PTCL–Telenor merger may reshape Pakistan’s telecom market, creating a formidable rival to Jazz and potentially accelerating digital infrastructure. But whether it delivers on its promises will depend on how strictly the CCP enforces its conditions in the years ahead.