The Ministry of Information and Telecommunications said Thursday local wireless carriers are not allowed to lower rates before Tet, the Lunar New Year festival starting next weekend.

According to the ministry’s Telecommunications Department, any rate cut by large companies at this point would trigger a price war, negatively impacting the domestic market and hurting small players.

With the announcement, the ministry has rejected proposals to lower mobile phone rates made by three local telecom giants Viettel, MobiFone and Vinaphone.

The ministry said they should focus instead on maintaining their service quality during Tet, when phone calls and text messages often surge sharply, surpassing the capability of local wireless carriers.

Military-run Viettel on January 27 asked for government’s consent to cut rates by up to 20 percent. Two days later Vinaphone and MobiFone, both managed by state-owned Vietnam Posts and Telecommunications, proposed similar rate cuts.

Viettel proceeded with its plan on February 1 without approval and sources from the ministry said the company would have to face penalties.

Source: Thanh Nien, SGGP