bodyType

customContents

entityId

entityUuid

articlePageQuery

filter

article

articleBaseAdvertisingInfoArticle

articleListArticle

articleSeoArticle

helpersCheckIsPostiesArticle

hooksArticleAcknowledgementGateOverlayArticle

hooksTrackPageViewArticle

hooksContentInterestArticle

articleLinkingDataContent

articleSchemaContent

liveArticle

advertZone

sentiment

contentLock

topics

types

sections

moreOnThisArticles

urlAlias

commentCount

sponsorType

authorLocations

authors

paywallTypes

corrections

displaySlideShow

multimediaEmbed

printHeadline

seriesContainer

socialHeadline

headline

flag

firstTopic

glossary

flattenTypeIds

publishedDate

additionalInfoBoxes

images

image

relatedLinks

relatedNewsletters

__typename

createdDate

sponsor

factSheets

series

disableOffPlatformContent

published

updatedDate

summary

subHeadline

body

keywords

copyrighted

customTimezone

liveContents

Ben Kwok

A decision to increase connection fees for international direct dialling (IDD) calls to the mainland was overturned yesterday after Beijing offered to compensate Hong Kong's major operators.

The move should ensure that IDD rates for consumers revert to their previous levels.

The decision was made after four mainland carriers met local IDD carriers in Shenzhen on Sunday following an outcry at the increase among Hong Kong's politicians and business leaders.

IDD operators had been forced to increase their rates by up to five times after the giant fixed-line carrier China Telecom told them last week that the Ministry of Information Industry had set a minimum rate of 17 US cents (HK$1.30) per minute for international calls to China from all countries and regions.

Although the new charges will remain, the ministry will ensure that mainland carriers pay compensation to their SAR counterparts. Analysts called it a 'face-saving resolution'.

Before the charges were imposed, Hong Kong had enjoyed a low rate of 2 US cents per minute.

Yesterday's decision came two days after Premier Zhu Rongji backed the steep rate rise by China Telecom, which delayed a planned US$3.6 billion (HK$28 billion) share offer last week. He said the rise, widely seen as a way to boost profitability, did not violate regulations.

A ministry spokesman confirmed the meeting with SAR carriers but refused to give details.

'I think the best thing is to ask Hong Kong operators. They know all the details,' he said.

Hong Kong's four major telecom operators announced an IDD rate cut for calls to the mainland yesterday, with Wharf New T&T reverting to a non-peak rate of 79 HK cents a minute and a peak rate of 99 cents a minute. This was half the increased tariff of $1.77 and $1.97 it had imposed on Friday.

'We are pleased that various issues have been clarified and consensus reached between the relevant parties,' said a company statement.

PCCW, Hutchison Global Communications, and New World Telephone did not immediately say by how much their rates would fall.

City Telecom, the second largest IDD operator, which did not take part in Sunday's meeting, also said it would reduce its mainland rates.

A local deputy of the National People's Congress (NPC), Ma Lik, welcomed the resolution of the dispute but said a lack of transparency in mainland regulations remained unresolved.

Last week Mr Ma and 14 other NPC local deputies had jointly urged its standing committee to launch an inquiry into China Telecom's decision.

'The issue has become a political one . . . The problem was resolved because of political pressure,' he said. 'But still, the whole process of decision-making is not based on the market mechanism and there is no transparency.'

The terms of the arrangement are confidential but it is understood Hong Kong carriers will get cash rebates for incoming calls from the mainland, depending on the volume of calls.

It is not clear for how long the new deal will run.



Mainland backs down on fees for IDD calls