March 2011 - In compliance with the directives of the Iraqi Communications and Media Commission (CMC) in its letter No. 969 dated 17 February 2011 and addressed to all mobile telecom companies, Asiacell the largest private Iraqi company and the first and only mobile telecommunications company to provide coverage for all of Iraq has disconnected on 1 March 2011 its frame relay with several millions of Zain Iraq lines, all of which have not been legally licensed by the CMC.

In its letter, the CMC stressed that neither Zain nor any other company may activate or market any new line without the Commission’s prior consent. The CMC also requested that all telecom companies immediately discontinue their interconnection with unlicensed lines under threat of litigation. Based on these directives, Asiacell has disconnected these lines to avoid legal ramifications.

Asiacell retains its legal right to demand compensation from Zain for distributing millions of unlicensed SIM cards, thus significantly damaging Asiacell’s market position by hindering its ability to supply the Iraqi market with the necessary amount of SIM cards and forcing Asiacell to reuse old lines for some of its offers. Moreover, Zain’s actions have resulted in limiting the amount of lines available toAsiacell, which has stunted the company’s ability to launch new offers that benefit Iraqis in various provinces.