Conflict Incident Report

BEIRUT: Taking out a pink sheet of paper, Hasan Khalil brandished the ticket he received  after the Economy Ministry slapped shops with fines for selling mobile phone recharge cards at inflated prices. The crackdown was met with a demonstration as retailers protested the move.

Khalil owns a snack shop in Downtown Beirut – he preferred to keep his shop’s name and location undisclosed – but he also sells recharge cards and other convenience store items. He was one of those accused of selling the cards for more than the official price. “Of course I am not going to buy a product from the distributor and sell it for the same price,” he told The Daily Star. “What would be the point?”

Recharge cards are available for a period of 10, 20 and 30 days, costing $11.36, $17.06 and $22.73 respectively, according to the price on the cards. Shops generally add a few dollars to this, sometimes charging between $25 and $26.60 for the $22.73 recharge card.

In response, the Economy Ministry has initiated a crackdown, fining shops that sell the cards at rates higher than the stipulated price.

“They came in and wrote us the ticket without any previous warning,” Khalil said, with evident frustration. “People come in here to get a bite to eat and sometimes they’ll need a recharge card, so I always carry a few.”

He argued that he had done nothing out of the ordinary in charging more for the cards than he paid for them. “Go ask any store selling these cards how much they charge.”

Tensions flared as owners of mobile phone shops and other outlets selling the cards protested in front of the Economy Ministry.

The owners argue that their establishments could not make a profit without raising the price of the cards.

Around 100 protesters held banners demanding they be allowed to make a better profit on recharge card sales.

“Restore the price of recharge cards to LL37,500” – or $25 – one banner read, opposing the set price of $22.73. “We want the ministry to protect us and not to allow random shops to sell recharge cards,” another banner read. “Increase the profit percentage of mobile shops and not that of the agents,” a placard said, referring to telecoms companies.

Demonstrators marched to the nearby Telecommunications Ministry to demand that the ministry assume its responsibilities by “organizing the sector.”

Khalil is waiting for his court date to be set. When asked if he would continue selling recharge cards, he said, “No way, I got rid of them all.”

Mobile phone users across Lebanon boycotted cellular network services in January to protest the high charges imposed by the two local operators.

Lebanese service providers force prepaid customers to recharge their accounts every 30 days.

If a customer fails to do so, their line is cut off and they lose any remaining credit.

A report published by Byblos Bank’s Economic Research and Analysis Department in September 2015 found that Lebanese prepaid users are charged the highest fees in the Arab world.

A telecoms monopoly exists in Lebanon, which is dominated by just two state-owned service providers: MTC touch – operated by Kuwaiti provider Zain – and Alfa, operated by Egypt-based Orascom Telecom Holdings.

Collectively, the two companies represent the Lebanese state’s second-largest source of revenue after taxation.