Ministry Takes Aim at Overseas Call Racket

he days of cheap overseas calls may be coming to an end, as the Ministry of Post and Tele­communications plans to step up its crusade against phone-card smugglers and illegal phone gateway operators, despite criticism of its handling of the situation from some branches of government and industry.

“If we do not crack down in time, our state budget would lose a lot of money,” said Cheim Sang­va, deputy chief inspector for the ministry. “First we need to crack down on the ringleaders, then we will raid every Internet shop still supplying Internet phones.”

The crackdown began with raids on Friday and Sunday that netted three suspects, and captured more than $4,000 worth of smuggled US and European phone cards, which experts said can be used from Cambodia at extremely low rates by accessing illegal satellite or Internet gateways.

Lawmakers from the Alliance of Democrats immediately criticized the raids, calling them “commercial intimidation” by the ministry to protect the triumvirate of Cambodia’s licensed gateway operators: The ministry itself, Royal Telecam Interna­tional and AZ Distribution.

Cambodia’s leading cell phone com­pany, which is owned by the same company as Royal Tele­cam, joined in the criticism, though for different reasons.

“The way to solve the problem is not only to try to catch the people doing [illegal gateway operation], but to have a pricing regulatory structure that allows the legitimate operators to compete,” said David Spriggs, general manager of MobiTel.

All phone service providers use one of two ways to get a signal in­to the international calling network, experts said: Via satellite or over the Internet, through a system called Voice Operated Inter­net Protocol. While setting up an unlicensed satellite link is clearly illegal, the current crackdown that centers on VOIP technology is on murkier legal territory, those in­volved said.

Sam Rainsy Party parliamentarian Son Chhay claimed the ar­rests are illegal because no criminal statute sets penalties for operating a VOIP gateway. However, a subdecree grants the Ministry of Post and Tele­communications sole right to license international VOIP gateways, putting smuggled phone cards and Internet cafes using unlicensed VOIP over the line.

The debate over the crackdown has raised issues of monopoly and deregulation that have haunted the telecom sector for some time.

When the ministry granted AZ its VOIP license last year, one of Royal’s shareholder companies complained that Royal’s deal with the ministry granted it the right to be the sole private gateway operator in Cambodia for 10 years.

Royal’s chairman and CEO, Kith Meng, declined to comment on the dispute, and AZ Chairman Ung Bun Hoaw could not be reached for comment.

“We have to have a law creating certain criteria: How the li­cense will be given, and what kind of penalty will be imposed on [those who violate it],” Son Chhay said.

Spriggs said deregulating the VOIP market was the answer.

The legal rate for calls to the US is $0.96 per minute, he said. The same call can be made over an illegal VOIP line for under $0.03 per minute, police said. Giv­ing more com­panies access to the cheaper VOIP technology through a transparent licensing process and lowering prohibitively high rates would let legitimate operators get the business now going to the black market, he said.

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