On 16th September, 2020, CFTC launched investigations against Airtel Malawi following several complaints from consumers against the Respondent.

The Complainants alleged that the Respondent’s customers are entitled to a monthly bonus (Khethekhethe Bonus) based on the consumption of a certain threshold of value for voice calls. Allegedly, for some time, the Respondent had been crediting customer accounts automatically with monthly bonuses earned during a particular month. This was easily accessible and beneficial to all eligible customers regardless of network availability.

However, it was alleged that the Respondent stopped automatically crediting customer accounts with monthly bonuses. Instead, it was alleged that customers were required to apply for the redemption of their bonuses on the 14th of every month. Consequently, customers who for one reason or another did not redeem their bonuses, had them forfeited. 

It was further alleged that the unredeemed bonuses were appropriated and sold to other customers after the 15th. The Complainants contended that the decision to require customers to apply for earned bonuses was unfair, abusive and without conscience.

The Commission sent a Notice of Investigation and conducted investigations against Airtel for alleged unconscionable conduct under the Competition Fair Trading Act (CFTA).   Section 43(1)(g) of the CFTA provides as follows: “A person shall not, in relation to a consumer, engage in unconscionable conduct in the trade of goods and services”.

Airtel responded to Notice of Investigation on 5th October, 2020. Further, on 26th March 2021, the Respondent appeared before the Commission and informed the Commission that they believed that the basis of the case against the Respondent was a lack of network on the 14th of the month resulting in failure to redeem the bonus by their customers. They, however, advised that customers could redeem bonuses from 10th to end of the month to be used from 14th to the end of the month.  Therefore, it was their belief that a lack of network on the 14th did not prevent customers from redeeming their bonuses.

Airtel also informed the Commission that they communicated to the customers through various means like radio, website and print about the date when the bonus became payable and when it could be used, however, customers started sharing information amongst themselves that the bonus was redeemable on the 14th which was not correct.

The Respondent admitted that the bonus was earned and not given as a gift as the more telephone credit a customer used the more bonus they would get. The Respondent also said that the bonus was also a way of appreciating its customers for using their network.

The Commission however noted that the Respondent did not provide a satisfactory justification why the Respondent migrated from the previous regime where the Khethekhethe Bonus was credited automatically to all qualifying customer accounts when it was due. By subjecting the said bonus to a further redemption process on a particular day, the Respondent disadvantaged consumers who on that material day could not redeem the bonus or access the network.

Based on the evidence before it, the Commission found that by changing the terms of accessing the bonus in a manner that disadvantaged consumers who had no mobile network coverage on the 14th of every month, the Respondent engaged in an unfair and unreasonable conduct. If the bonus was being granted in good faith, the Respondent should have been automatically crediting the qualifying customers’ accounts, as had been the trend in the past.

By failing to promptly pay Khethekhethe Bonus to all deserving consumers who reached the minimum threshold of K1,000 per month; and consequently forfeiting the same to the company’s advantage, the Respondent acted unreasonably and without conscience.

In view of the foregoing, the Commission determined that the Respondent contravened Section 43(1)(g) of the CFTA.

The Commission therefore ordered Airtel to pay a fine of Two Billion One Hundred and Thirteen Million Ninety-Nine Thousand Six Hundred and Sixty Kwacha (MK2,113,099,660.00) for engaging in unconscionable conduct in the trade of goods and services. This represented the financial gain generated from the offence.