Brussels, 26/07/2004 (Agence Europe) - The Commission on Monday sent two separate statements of objection to the British mobile network operators Vodafone and O2 (see EUROPE of 24 February). According to the preliminary findings of its investigation, the tariffs set by the two companies for billing international roaming services could constitute exploitation of their dominant position. International roaming is when users abroad use a national operator where their own operator does not cover the country in question. The Commission began its investigation in 2001 focussing in particular on the United Kingdom and Germany. A source close to the dossier has indicated that German operators could be subject to the same procedure in a few months.
The Commission states that, since 1997 in the case of Vodafone and since 1998 in the case of O2, up to September 2003, the two companies have occupied a dominant position on their respective networks for the provision of international roaming services and the prices demanded of other operators are excessive. Since 1998, the level of prices paid between operators for the use of roaming (or Inter-operator tariff, IOT) was very different from the tariffs charged of users by the national operator. The Commission observed that, during the period in question, there was no way for the consumer to freely choose a network and that network selection occurred on a random basis. This meant that the consumer's own operator could not direct them to a certain network abroad, which meant there was no incentive to lower prices. Alliances between operators have since the end of 2003 been aiming to organise this type of strategy, but the Commission thinks that before that, the Vodafone and O2 monopolies on their own networks led to abusive prices being introduced. In definitive terms, too, it is the consumers who use their mobile abroad to make or receive calls who have the excessive costs of these general agreements passed on to them by their own operators. The Commission has focussed on the United Kingdom and Germany because it is possible to find proof of abuse of a dominant position there, said Tilman Lueder, competition spokesman. Although international and domestic roaming systems basically use the same technology, the price for the same kind of call is twice as high in the case of international roaming, says the Commission. O2 and Vodafone cover domestic roaming for British users of independent service providers under a general agreement similar to that for international roaming.
The two companies can now make their point of view on the statements of objection both in writing and at a hearing, probably in the autumn, to avoid a possible fine from the Commission.