Pakistan’s long-awaited $1 billion Ufone and Telenor merger has reportedly hit a roadblock after the country’s competition watchdog blamed the delays on lapses by Pakistan Telecommunication Company Limited (PTCL).

According to local news outlet Express Tribune, the Competition Commission of Pakistan (CCP) revealed during a briefing to the country’s Senate IT Committee that PTCL did not submit a mandatory $1 billion investment plan for regulatory review and failed to provide a timely outline of expected efficiency gains from the merger.

The deal, first announced in December 2023, would see PTCL, the owner of Ufone, acquiring Telenor Pakistan to create the country’s largest mobile operator. Since, the merger has hit repeated roadblocks, with the country’s antitrust regulator flagging competition concerns last year.  

During the briefing, the watchdog further criticised the operator for delaying information requests and ignoring separate accounting rules between PTCL and its mobile arm Ufone. “PTCL abuses its dominant position,” the CCP reportedly stated, citing the company’s track record of non-compliance, collusion and legal challenges against the Pakistan Telecommunication Authority (PTA).

The regulator also raised concerns over PTCL’s poor performance with Ufone, noting the mobile operator has consistently posted losses under its ownership.

While acknowledging the potential for scale and efficiency, the CCP ultimately warned that the deal could pose a risk to competition by cementing PTCL’s market dominance, eroding consumer choice, restricting innovation and increasing barriers to entry.

Under Pakistan’s Competition Act, the regulator reserves the right to reject the transaction or impose strict conditions, Express Tribune reported.