The Office of Utilities Regulation (OUR) on Saturday established a minimum rate that local telephone companies can charge their foreign counterparts to terminate calls in Jamaica - as part of an effort to cauterise the massive fall-off in foreign exchange earnings from incoming international calls.

Jamaica, which up to four years ago netted over US$100 million per year from foreign calls, now nets a mere US$20 million.

The reason for the decline is that American long distance carriers now pay far less to Jamaican companies for the delivery of telephone calls that originate in the United States.

Prior to the rate restructure on Saturday, US carriers paid their Jamaican counterparts as low as US$0.05 to route calls into their network - coming from a high of US$0.57 some years ago.

The minimum charge has been set at US$0.081 for terminating on land-line and US$0.169 for mobile phones.

The OUR said that Jamaica was losing valuable foreign exchange while US carriers were reaping the benefits of lower rates. Moreover, the reduction in the rates was not redounding to the benefit of US consumers, the OUR said.

"So the only persons who seem to benefit from this whole experience has been the US carriers," said J Paul Morgan, the director-general of the OUR.

Interestingly, the OUR said that it tried to stop the fall in the rates some years ago but was stopped by its own minister, Phillip Paulwell. The minister and the OUR were at loggerheads over the issue with Paulwell arguing that he wanted the rates to be market driven.

The issue ended up in the Supreme Court which Paulwell won two months ago. He apparently has since however reversed his position.

"The minister recognised the developments in the market," said Morgan yesterday at the New Kingston head office. "This essentially reversed the direction that he had issued some 18 months ago which as you know was subject to judicial review."

http://www.jamaicaobserver.com/magazines/Business/html/20040127T220000-0500_54968_OBS_OUR_RAISES_PHONE_RATES_ON_AMERICAN_CALLERS.asp