Telkom granted leave to appeal LCR ruling

JOHANNESBURG (12/02/2003) - Following the landmark judgement handed down in October by Pretoria High Court Judge, IBW de Villiers, Telkom SA Ltd. Tuesday was granted leave to appeal the judge's ruling.

This was that least cost routing (LCR) systems and equipment are not, as Telkom contested, illegal, and do not infringe the national carrier's rights under the relevant legislation. This major victory for the service providers in the industry will now be appealed by Telkom.

"The original High Court judgement was a resounding victory for a critically important sector of the industry," says Mark Taylor, MD of Nashua Mobile, and first among the several respondents in the case. "This decision to allow an appeal does not diminish what we have always maintained -- that LCR services are in no way illegal."

The Telkom appeal will be heard by the Supreme Court of Appeals in Bloemfontein. This would appear to be a final option. Such a process could easily take between 12 and 18 months.

"Even with the Telkom appeal, the original ruling will stand, and new and existing users of LCR services may continue to enjoy the benefits of LCR.

"We are talking here about an industry already worth some R2 billion (US$315 billion) per year, which has demonstrated both growth and growing interest from major corporates and smaller businesses. It is unfortunate that the aura of uncertainty created by Telkom's original court action resulted in some fence-sitting by many companies, who would otherwise have eagerly adopted the LCR technology.

"Obviously, this worked in favor of the national carrier's own interests -- some R6 billion is spent every year on calls made from Telkom landlines to cellular numbers.

"The present decision to allow an appeal no doubt takes into consideration the major issues of the original case, and how they impact on the industry and the larger national economy. We are still confident, however, that our arguments are sound, and will ultimately be vindicated in the country's highest court of appeal.

"No matter what size of business is considered, LCR offers the savings and improved efficiency that generate a competitive advantage, and we look forward to continuing to offer what we have always contested was a legal service -- still confident that the legal issues will be resolved in favor of the industry and consumers in general," Taylor concludes.

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