The OUR's proposal for a decrease of about one-third in the prices of telephone calls from the fixed network to Digicel's mobile was expected to take effect in July, this year.

However, the new rates have not been implemented because Mossel (Jamaica), trading as Digicel Jamaica, has taken the matter to the Supreme Court, seeking a declaration that the OUR has no authority to regulate its rates. The case has been set for hearing in January 2003.

Digicel currently charges at the maximum of $12 per minute for calls made during peak periods from a fixed line to its mobile network, $11 during off-peak periods and $10 on weekends.

However, in a determination notice issued in May, this year, the OUR decided that the rate should be lowered to about $8 per minute at its highest.

The OUR's determined that the price of fixed to mobile calls should continue to be set by participating mobile carriers, subject to a cap. That cap was calculated using Cable & Wireless Jamaica's (C&WJ) mobile termination costs, plus the imputed cost of spectrum, plus the retention for the fixed network costs, which included an allowance for bad debt.

It is the establishment of those rates that Digicel is challenging in the Supreme Court, saying that in a competitive telecommunications market, the utility regulator should not be allowed to regulate the rates.

Earlier this year, Digicel's chief operating officer, Seamus Lynch, said the one-third reduction in the existing rates would also mean a cutback in the company's revenue by a third.

The existing rates are those previously set by the OUR and are based on international benchmarks, which the regulatory agency said have since been reduced. It was the reduction in the international rates that spurred the OUR to determine that reduced maximum rates should be applicable for fixed to mobile rates for domestic calls on the Digicel network.

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