Telecom Liberalisation Lacks a Credible Competition Arbiter

Dec 13 , 2025
By Yonas Jarsa

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When Safaricom Ethiopia disclosed that many of its M-Pesa customers were unable to access a newly updated version of the app, "Lehulum", the reaction was largely dismissive. In a market still adjusting to liberalisation, glitches are often treated as a fact of life.

However, the problem pointed to a deeper structural weakness in the absence of an independent and empowered competition authority capable of disciplining dominant firms.

The updated M-Pesa application could be accessed on Safaricom’s own network, but not by users on Ethio telecom’s data connection. For customers who depend on one operator for mobile data and another for mobile money services, the limitation was more than an inconvenience. It effectively narrowed the choice, which should have prompted regulatory intervention in a functioning competitive market. Here, it passed largely without consequence.

The concern does not end with app access. Many mobile devices sold through Ethio telecom outlets reportedly do not allow SIM cards issued by Safaricom Ethiopia to function. Whether this results from deliberate SIM-locking or technical configuration, the effect is the same. Consumers are prevented from switching networks or using competing services, while a new market entrant is placed at a structural disadvantage.

In jurisdictions with mature competition regimes, these practices would raise red flags. Regulators would examine whether a dominant operator was using control over infrastructure or devices to exclude rivals, limit consumer choice, or entrench market power. Such conduct is typically assessed under rules governing abuse of dominance, discrimination, and exclusionary practices.

However, the domestic legal framework is not silent on these issues. Under the 2013 law, which polices trade competition and protects consumers, practices such as tying, refusal to deal, limiting market access, and discriminatory conduct by dominant firms are prohibited. In Article 5, the law broadly bars acts that “prevent or obstruct competition,” while Article 7 explicitly outlaws “abuse of dominance,” including behaviour that restrains competitors.

On paper, the law is robust. In practice, enforcement is weak.

The former Trade Competition & Consumer Protection Authority (TCCPA) has been dissolved and replaced by a department within the Ministry of Trade & Regional Integration (MoTRI). As a result, Ethiopia lacks a dedicated and autonomous institution with the technical capacity, investigative powers, and institutional independence needed to resolve complex competition disputes, particularly in fast-evolving sectors such as telecommunications and digital payments.

The disparity with the European Union (EU) can be instructive. When Apple Inc. restricted access to certain apps, technologies, or payment systems, often to the detriment of competitors, the response was swift. EU regulators intervened using long-standing competition rules and, more recently, the Digital Markets Act. Apple Inc. has faced repeated investigations and fines for preventing rival services from functioning fully, restricting access to app stores or payment systems, and using its control over devices to disadvantage competitors.

The principle guiding these actions is straightforward. Dominant firms cannot be allowed to use their position to block consumer choice or foreclose competition.

Competition enforcement depends heavily on institutional design. It cannot function effectively as a unit within a ministry. It requires professional staff insulated from political pressure, transparent procedures for complaints and investigations, authority to request data and conduct market inquiries, and the power to issue binding decisions and impose corrective measures.

Safaricom's entry into the domestic market introduced competition, attracted investment, and promised improved services for consumers. But liberalisation without enforcement delivers only partial reform. A competitive market is not created simply by licensing a second operator. Credible rules and an impartial referee sustain it. Ethiopia has the rules now, but not the referee.

The dispute over M-Pesa access should be considered more than a technical disagreement between two telecom operators. It is a warning sign that, without an autonomous competition authority capable of intervening early and decisively, similar problems will recur. Dominant players will continue to shape market outcomes, not through superior services or innovation, but through control over networks, devices, and access points.

If Ethiopia intends to build a functioning digital economy, one in which consumers choose freely, innovation is rewarded, and firms compete on merit, its lawmakers should re-establish an independent competition authority. Such an institution would need a clear legal mandate, autonomy in decision-making, and the tools to investigate powerful firms operating in strategic sectors.

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PUBLISHED ON Dec 13,2025 [ VOL 26 , NO 1337]

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