The Ministry of Finance opposes cancelling the separation of DBS Satellite Services (1998) Ltd. (YES) from Bezeq Israeli Telecommunication Co. Ltd. (TASE: BEZQ), sources inform "Globes." The Ministry of Finance intends to insert clauses into the upcoming economic arrangements bill that will delay the elimination of structural separation between the two companies until new competitors in the multi-channel television market achieve a substantial market share.
This means that the structural separation between Bezeq and Yes will not be removed until Cellcom Israel Ltd. (NYSE:CEL; TASE:CEL) or other competitors become established in the market. The Ministry of Finance is willing to show flexibility concerning other companies in the Bezeq group.
At the end of last week, Bezeq CEO Stella Handler met with senior Ministry of Finance officials, who explained their views to her. Sources inform "Globes" that the Ministry of Finance is considering the use of additional tools, including separation between Bezeq's wholesale and retail activities, in order to safeguard the supply of wholesale services by Bezeq to its competitors.
At this stage, however, it is unclear whether the Ministries of Finance and Communications share the same views on structural separation, but it is clear that without cooperation between them, the matter is liable to be stalled for many years. It was Minister of Finance Moshe Kahlon who as Minister of Communications in 2012 established the rules to allow the elimination of structural separation in Bezeq.
The Ministry of Finance said in response, "A working meeting took place as part of the Ministry of Finance's regular work with Bezeq."
The Ministry of Communications was upset about the Ministry of Finance's views on structural separation in Bezeq. Senior Ministry of Communications officials said that the Ministry of Finance had no authority to make regulatory decisions about the companies, including decisions about structural separation. They added that the Ministry of Finance could add nothing in the communications sector in the economic arrangements bill without the Ministry of Communications' agreement. Since no discussions have taken place with the Ministry of Finance about the economic arrangements bill, no clause in it had been approved. The also said that they regretted that the Ministry of Finance was busy stealing credit for the broadcasting reform.
"The members of the Filber Committee, who thought that its recommendations had been published last week, have learned that their conclusions had not yet been published. Some of them had been added to the Ministry of Finance's draft in the economic arrangements bill in an attempt to grab the credit. The Ministry of Finance presented to the prime minister excerpts of the committee's decisions before the report had been signed, without the knowledge of the committee members and representatives of the Ministry of Communications, and without the Ministry of Communications holding a discussion on the matter," the Ministry of Communications stated.
Published by Globes [online], Israel business news - www.globes-online.com - on July 3, 2016
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