Competition Commission probes Vodacom's Treasury contract

The investigation comes after Vodacom secured an exclusive contract with National Treasury to be the sole provider of mobile telecommunication services to government.

Competition Commission spokesperson Sipho Ngwema says the contract was secured in March 2016.

"We have concerns about the four-year agreement because we think it has features of abuse of dominance. 

"The Commission has information that there are 20 government departments which will be subjected to the new Vodacom contract. Other departments, including state owned entities and municipalities, will be incentivised to adopt the new contract. "

Ngwema says the contract will further entrench Vodacom's dominance in the market and result in a loss of market share with competitors. 

On Wednesday, Vodacom announced its decision to slash out-of bundle data rates. 

Last year, it reduced it from R2 to R1.50. 

"For pre-paid and customers on top-up packages, the out-of-bundle rate will drop by as much as 50% once the new 99c per megabyte tariff comes into effect on October 15.

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"The out-of-bundle rate for post-paid customers was reduced from R1 per megabyte to 89c on October 1," the company says in a statement.