The Communications Authority of Zambia (CAZ) lost a bid in the Lusaka High Court to give a license to an unnamed international mobile-phone company to become the country's fourth mobile-service provider.

Instead, the court has ruled that local company Vodacom Zambia be given a license to become the fourth mobile-phone service provider and thereafter, CAZ can invite a fifth provider.

CAZ wanted to block Vodacom from becoming the country's fourth provider, claiming the local company failed to meet the license requirements and instead inviting international mobile companies to apply for a license.

Vodacom Zambia directors Enock Kavindele and Enock Kavindele Jr. sought an injunction in the Lusaka High Court restraining CAZ from issuing the fourth national mobile license to any international company other than Vodacom Zambia.

Vodacom applied for a license in 2001 and was awarded one, but the CAZ later claimed that it did not have enough frequencies to give to Vodacom.

In 2004, the Zambian government, through the Ministry of Communications and Transport, re-located frequencies to the CAZ. However, CAZ did not give Vodacom the frequencies but instead cancelled the license, claiming the company failed to meet the license conditions.

In February of this year, CAZ invited international mobile-phone companies to apply for a license to become the country's fourth mobile-service provider. This prompted Vodacom Zambia directors to seek legal redress, insisting they are lawful holders of the license.

In his ruling, Judge Phillip Musonda said Vodacom Zambia has always been willing to meet the conditions of the license, which includes bringing in a strategic partner and paying US$3.28 million in fees.

"I'm surprised by the way the Communications Authority of Zambia treated a Zambian company less favorably than a foreign company with almost equal equity in the consortium," Musonda said earlier this week.

Musonda further ruled that the instances of Zambian citizen-owned companies being treated unfairly by public institutions must immediately come to an end. Vodacom Zambia gave CAZ an opportunity to resolve the frequency difficulties it had, but after doing that CAZ chose to ignore Vodacom, opting to hold the company in breach by failing to provide the frequencies, Musonda said.

The IDG News Service is a Network World affiliate.