Antitrust Authority director general Dror Strum has summoned companies and individuals to a pretrial hearing relating to a cartel set up by Telrad and Tadiran Telecommunications to sell public exchanges to Bezeq and private exchanges to the business sector. ''Globes'' revealed the affair four years ago.
Bezeq today notified the Tel Aviv Stock Exchange (TASE) that it received the summons to the hearing yesterday. So far as is known, Telrad and probably ECI Telecom (Nasdaq: ECIL), which acquired Tadiran Telecommunications, received similar summons.
Antitrust Authority investigators raided the offices of Koor, Tadiran, Telrad and Tadiran Telecommunications on February 3, 1997, following a ''Globes'' expose the previous day. The investigation discovered a written agreement between Tadiran Telecommunications and Telrad, with the knowledge of Koor Industries (NYSE: KOR) and Tadiran, to collude in fixing prices for public exchanges sold to the only Israeli customer for them, Bezeq. The agreement also divided the private switchboard market between the two companies. An Antitrust Authority statement said the investigation was opened as a result of the "Globes" expose.
The individuals named by the investigation were Tadiran Telecommunications general manager Haim Rosen, Tadiran general manager and former Telrad general manager Yisrael Zamir, former Koor general manager Benny Gaon, former Telrad general manager Betzalel Zamir and former Tadiran and Telrad general manager Gurion Meltzer. These and other individuals were investigated or questioned during the investigation.
The investigators later raided the offices of Bezeq and its subsidiary for NTP (Network Terminating Point) services, BezeqCall Communications. Individuals were questioned at both companies, and some of them were probably summoned to the current hearing.
The summons to Bezeq states that the investigation raised suspicion that Bezeq, and probably other companies and the individuals then heading them, were a party to arrangements in restriction of trade for the purchase of public exchanges equipment and various services, as well as the market division and non-entry of new competitors to the agreements signed between Bezeq and the two companies for 1994-97 and 1997-2000.
Bezeq added in its statement to the TASE that it is unable to assess the significance of the Antitrust Authority's decision about the company at this time. Nor can it know what will be the Antitrust Authority's final decision regarding the company after the hearing, or its consequences to the company, including the ability of Bezeq’s shareholders, customers or any other party suing the company, or Bezeq’s ability to sue others.
Published by Israel's Business Arena on 4 March 2002