Overview of corruption in the telecommunications sector

This Anti-Corruption Helpdesk brief was produced in response to a query from a U4 Partner Agency. The U4 Helpdesk is operated by Transparency International in collaboration with the U4 Anti-Corruption Resource Centre based at the Chr. Michelsen Institute.

Query

Could you provide an overview of corruption-related issues in the telecommunications sector, with a focus on SADC countries?

Content

1. Why does corruption in the telecommunications sector matter?
2. Overview of corruption in the telecommunications sector
3. Overview of current anti-corruption efforts in the telecommunications sector
4. References
5. Further reading

Summary

With its high revenue generation potential, its complex technical and governance structure and its deep interrelations between public and private sector components, the recently liberalised telecommunications industry is particularly vulnerable to corruption. From an economic perspective many segments of the telecommunications sector are prone to network and scale effects and continuous technological disruption, all of which makes the establishment of competitive markets, the determination of fair prices and the setting of public interest-oriented regulations very difficult to achieve. This also means that policies and regulatory actions that have been corrupted by special interests are often difficult to identify.

Given the social and economic significance of telecommunications, corruption in the sector has significant negative effects from macro-level development to individual citizens. It ranges from petty bribery on the side of consumers to capture of regulatory authorities by special businesses or political interests.

The licensing process is particularly prone to corruption and undue influence because of its strategic importance and complexity. Corruption is however also a problem seen in regulation, price-setting, in the supply chain as well as customer services.

Authors

Reviewers

Date

08/04/2014

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