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Competition

PR(08)21: The EFTA Surveillance Authority seeks views on remedies offered in relation to competition investigation of telecommunications restructuring in Liechtenstein

15.5.2008

In a preliminary assessment of December 2007, the Authority concluded that an agreement between Liechtensteinische Kraftwerke Anstalt (LKW) and Telecom Liechtenstein AG would result in restrictions of competition contrary to the competition rules of the EEA Agreement. LKW and Telecom Liechtenstein (the parties) have submitted commitments in order to remove the Authority’s concerns. The Authority has today published a notice which summarises the commitments and invites interested parties to submit comments within one month.

In December 2006, the Authority received a complaint against the then LTN Liechtenstein TeleNet AG, (now re-established as Telecom Liechtenstein) LKW and the Principality of Liechtenstein alleging that the restructuring of the telecommunications market in Liechtenstein was contrary to the EEA competition rules. The complaint alleged that the Principality of Liechtenstein had taken measures such that the two companies were bound to infringe the competition rules of the EEA Agreement.

Telecom Liechtenstein is a 100% state-owned telecommunications operator in Liechtenstein. LKW is a 100% state-owned electricity and telecommunications undertaking in Liechtenstein.

The Authority found that the Principality of Liechtenstein had not infringed the EEA competition rules by imposing certain behaviour on the two companies. However, in a preliminary assessment the Authority concluded that the parties had infringed the EEA competition rules by: (i) committing not to compete with each other for an unlimited period of time; and (ii) concluding a strategic alignment with regard to development of the telecommunications network in Liechtenstein underwhich LKW is required to fulfil the network infrastructure requirements of Telecom Liechtenstein. The concerns were that these provisions would restrict competition and would have a foreclosure effect on actual and potential telecommunications operators in Liechtenstein.

In December 2007, the Authority opened proceedings concerning alleged infringements of the EEA competition rules by the parties. The Authority issued a preliminary assessment to the parties detailing the substance of its competition concerns.

In February 2008, following receipt of the preliminary assessment, the parties submitted commitments to remove the Authority's concerns. Under these commitments the parties remove the non-competition clauses and provisions regarding strategic alignment from their agreement. With regard to network development planning, LKW commits to regularly ascertain the requirements of all service providers as regards network infrastructure with a view to providing non-discriminatory access to all market participants. A non-confidential version of the commitments is available on the Authority’s website.

Following the consultation period, the Authority may make the commitments binding on the parties by decision.

By publishing this market test the Authority invites interested parties to present their comments on the commitments offered by the parties within one month of the publication in the Official Journal and the EEA Supplement.

Details of the proposed commitments have been published in the EU’s Official Journal     C 118/31 of 15 May 2008 and are available on the Europa website

and in the EEA Supplement, No. 28, page 4, 15.5.2008 on the EFTA Secretariat website www.efta.int

 

For further information, please contact:

Mr. Justin Menezes
Senior Officer, Competition & State Aid Directorate
Tel. (+32)(0)2 286 18 84

 

15 May 2008




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