Jamaican Agreement to Terminate CWJ Monopoly

One of the major obstacles to liberalizing the Jamaican telecommunications sector was the exclusivity rights enjoyed by Cable & Wireless Jamaica Limited (CWJ).  Among the rights enjoyed by CWJ pursuant to the terms of its telecommunications operating licences were exclusivity rights over the provision of local PSTN services, long distance services, and international services.  CWJ’s exclusivity rights extended for a period of 25 years, beginning in 1988.


In the late 1990s, CWJ and the Jamaican Minister of Commerce and Technology became embroiled in legal proceedings relating to the issuance of VSAT licences, which CWJ claimed violated its rights to exclusivity.  During this same time period, there was a growing trend around the world towards the liberalization of telecommunications sector.  There was increasing pressure in Jamaica to reform the telecommunications regulatory framework, including pressure to introduce competition in the sectors in which CWJ enjoyed a monopoly over the provision of services.  The ability of the Jamaican regulator to introduce reform, however, was constrained by the exclusivity rights held by CWJ pursuant to the terms of CWJ’s telecommunications operating licences.


In September 1999, the Government of Jamaica, acting through the Minister, came to an agreement with CWJ regarding CWJ’s licences and the exclusivity rights contained in those licences.  A link to a copy of this agreement is set out below.


Pursuant to the terms of the agreement, CWJ agreed to surrender its telecommunications operating licences and, by implication, its exclusivity rights.  In return, CWJ would be issued new licences under a new licensing framework.  The government agreed to adopt and to implement the new licensing framework through legislation prepared in accordance with a set of Draft Instructions.  The Agreement indicates that the Drafting Instructions had been seen and accepted by CWJ. 


In return for the surrender of the CWJ operating licences, the government agreed to procure that all existing holders of the VSAT licences at issue in the legal proceedings would surrender those licences in return for new VSAT licences issued in accordance with the Drafting Instructions.  The government also made commitments to ensure that all competitors licensed under the new telecommunications legislation would be treated in a manner consistent with the terms of the Drafting Instructions.


In addition to a number of other provisions, the agreement contains stipulations for the settlement of the legal dispute between the Minister and CWJ.  The agreement also imposes certain obligations on CWJ relating to the construction of new lines.


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