Johannesburg - Vodacom Group will take legal action against the industry regulator over plans to halve the amount it can charge other operators for use of its network.

The Independent Communications Authority of SA (Icasa) said last month that it would cut mobile termination rates charged by dominant operators to 20c this year, with further reductions planned for next year and 2016. Operators with less than 20 percent market share can charge 44c, declining to 40c in 2016.

MTN Group has already taken legal action to block the proposals, which will reduce revenue at the two companies.

“The issue at hand is not whether these rates come down, it’s about ensuring that the legislated fair and objective process is used to determine the final rates,” the operator controlled by UK-based Vodafone said in a statement. “Icasa has not followed this process and as a result our customers will be unfairly prejudiced.”

The reduction in rates is intended to help smaller cellular network operators including closely held Cell C and fixed-line specialist Telkom.

Vodacom and MTN controlled about 80 percent of the market, BPI Capital Africa analyst Kate Turner-Smith said last month.

Vodacom shares declined 1.28 percent to R117.28. MTN shares were 0.13 percent higher at R196.58. – Bloomberg