Just six days after its inception, Melita Mobile is being investigated on potentially misleading advertising over what it charges for calls.

The Consumer and Competition Division said yesterday Melita Mobile's adverts "might potentially mislead consumers".

It said the advertisements, which say that rates are "up to 30 per cent cheaper", did not make it clear enough that calls start being charged on a per-second basis only after the first minute.

"This would eventually lead the consumer to take a transactional decision which he would not have taken otherwise. The note in small print that 'Calls are on a per-second basis after the first minute' does not seem to be clear enough for the average consumer to make an informed decision," the division said.

The company defended its advertising, saying the brochures produced in relation to its mobile services clearly indicated that calls were charged on a per-second basis after the first minute. Moreover, all customer service representatives were trained to inform customers accordingly.

Melita plc said the division had "acted arbitrarily without consulting it on this claim and without following normal procedures set by law".

It added that it was informed of the division's concern only after reading reports in the media.