Brussels, 15/06/2006 (Agence Europe) - The European Commission has sent a letter to the German authorities in which it urges the German regulator to impose more effective competition remedies for fixed telephony. It is calling for an efficient price control mechanism in order to protect consumers against the risk of excessive prices being charged by the dominant operator Deutsche Telekom. In December 2005, Deutsche Telekom AG (“DTAG”) was found by BNetzA to have significant market power (“SMP”) on the retail access market and on the market for local and national calls. This analysis appears to have been backed up by the Communication on Market Reviews of 7 February, in which the Commission pointed to some recurrent shortcomings in remedies proposed by national regulators, particularly Germany. In an effort to rectify the problems identified, BNetzA proposed some corrective measures to the Commission in an attempt to regulate the market but the Commission considered them insufficient and invited the national regulator to increase the effectiveness of the proposed remedies. The Commission invites the German regulator to consider imposing a more efficient price control mechanism based on a number of other national regulators who found the retail access markets were not competitive but which have already remedied the market failure through ex ante price regulation (regulators in Austria, Ireland, Slovakia, Slovenia, Netherlands, Hungary, Malta and Spain). In order to implement carrier (pre-selection cost orientation effectively and to make price control effective, the regulator is also invited to impose accounting separation requirements on Deutsche Telekom.
In its Communication on Market Reviews, published in February this year, the Commission pointed to some recurrent shortcomings and explained that on 28 June it would be outlining proposals for ensuring EU telecom rules took account of increasing cross-border competition.