Asters
  May 21, 2003 - Kyiv, Ukraine

Billing Changes: Customers Win, Mobile Operates May Lose Out
  by Igor V. Svechkar

Incoming Call ChargesIn February 2003 the Ukrainian Parliament overruled President Kuchma's December 2002 veto against an amendment to Article 12 of the Communications Law 1995. The amendment prohibits all telecommunications operators from charging their customers for incoming calls. On March 13 2003 the president duly signed the amendment, which will come into effect six months after its official publication (ie, on September 18 2003). The amendment has met fierce resistance from mobile operators and its adoption was a protracted process (for further details please see "Bell Tolls for Incoming Call Charges"). The Parliament also recently voted on, but did not pass, a proposed new Telecommunications Law. It is expected that the proposed law will be resubmitted for a vote by the Parliament in the near future. The law includes a provision with respect to incoming calls which states that ''customers are entitled to refuse to pay for telecommunications services which are not ordered''. If adopted as currently proposed, this provision will still allow mobile operators to charge subscribers as long as they agree to be charged for incoming calls.If the new Telecommunications Law does not take effect before the amended Article 12 of the Communications Law come into force, the removal of charges for incoming calls may have a significant effect on mobile operators in Ukraine, unless a 'calling party pays' (CPP) interconnection regime among mobile and fixed-line telecommunications operators is effectively introduced before September 18. The chairman of the State Committee for Communications and Information has publicly announced that if the approved amendment to the existing Communications Law is to come into effect, the plan to implement a CPP interconnection regime must be brought forward and established. Per-Second Billing Another significant legislative development in the telecommunications sector deals with per-second billing. In late November 2002 the Parliament passed a law implementing per-second billing on a mandatory basis for all telecommunications services, but the President vetoed it. In February 2003 the Parliament adopted a further amendment to Article 12 of the Communications Law, which requires operators charging customers based on time tariffs to charge only for fully used time units (ie, any rounding which is done must be downwards). The president signed the amendment on March 18 2003, to become effective six months after its official publication (ie, on September 20 2003).At present, operators are permitted to round time units used by customers upwards, thus generating extra profit. For instance, when per-minute tariffs are used, a customer pays a full minute's worth for a 10-second call.The newly introduced 'round down' requirement is likely to force operators to introduce per-second billing due to profitability considerations. The Ukrainian law-makers have thus managed to implement per-second billing system in a roundabout way. For further information on this topic please contact Igor Svechkar or Olena Repkina at Shevchenko, Didkovskiy & Partners by telephone (+380 44 230 6000) or by fax (+380 44 230 6001) or by email ([email protected]).


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