Abuse of dominant position
Statement of objections to Slovak Telekom and Deutsche Telekom
By Sophie Mosca | Tuesday 08 May 2012
Slovak Telekom a.s. is under scrutiny by the European Commission for hindering competition on several wholesale broadband markets in Slovakia. On 7 May, the EU executive sent the firm a detailed statement of objections, challenging in particular its refusal to provide unbundled access to its local loops and wholesale services to competitors, as well as its unjustified wholesale prices for broadband, which prevent other operators from entering and operating profitably on the retail broadband market in Slovakia. Slovak Telekom’s parent company, Deutsche Telekom, also received the statement of objections. The Commission considers that it may have played a role in these suspected infringements “because of the nature and degree of its ties with its subsidiary, Slovak Telekom, in which it owns a majority stake of 51%,” reads a statement. In December 2010, the Commission broadened its initial (2009) investigation into Slovak Telekom’s behaviour to include Deutsche Telekom.
The telecoms market in Slovakia has been fully liberalised since 2003 and, with respect to the EU, since its accession to the Union, in May 2004. The incumbent operator that held the monopoly for broadband internet services, which later became Slovak Telekom, is obliged by EU law to make its network available, on reasonable technical and price terms, to other operators interested in providing retail services to end users in Slovakia. The Commission is of the view that Slovak Telekom imposed “unreasonable and burdensome” technical and commercial terms on its competitors. The wholesale prices imposed on other operators resulted in a margin squeeze. The EU General Court ruled, on 29 March, that this practice constituted abuse of dominant position that also obstructed entry and growth on this market to the detriment of consumers in terms of prices, choices and innovation (see
The Commission also finds that Slovak Telekom “used delaying tactics and obstructed negotiations over these terms, in particular as regards unbundled access to local loops”.
In this procedure, Slovak Telekom maintained that the Commission was not competent to oblige it to provide information concerning its practices for the period prior to its EU accession, on 1 May 2004. Its arguments were rejected by the EU General Court
(1), however, which ruled that the Commission had to have access to all information relevant to its decision, including data related to a period prior to the accession of the state where the company concerned is established (4391).
(1) Joint Cases T-458/09 and T-171/10