European Court confirms abuse of position by France Telecom

30th January 2007, Comments 0 comments

LUXEMBOURG, Jan 30, 2007 (AFP) - A European Court on Tuesday upheld a 2003 ruling that France Telecom abused its dominant position in the French Internet access market.

LUXEMBOURG, Jan 30, 2007 (AFP) - A European Court on Tuesday upheld a 2003 ruling that France Telecom abused its dominant position in the French Internet access market.

The Luxembourg-based Court of First Instance backed the original ruling by the EU's executive arm, the European Commission, which in July 2003 imposed a 10.35-million-euro (13.4-million-dollar) fine on Wanadoo, an Internet affiliate of France Telecom.

Wanadoo has since become part of the Orange brand, which includes most of France Telecom's former global operations.

"Predatory pricing which does not allow either variable or full costs to be recovered, as part of a plan to pre-empt the market for high-speed Internet access, constitutes an abuse of a dominant position," the court said in its ruling.

In its action, the company disputed that it had a dominant position or that there was abuse.

The Court however decided that Wanadoo did have a dominant position on the French market for Internet access.

It pointed to Wanadoo's "very high market share during the period at issue," with eight times the number of ADSL subscribers than its number one competitor, and its link-up with France Telecom, the incumbent telecommunications operator in France, which gave it advantages over competitors.

The Commission found that the predatory prices charged by Wanadoo for its services did not allow it to cover its costs for a considerable period, part of "a plan to pre-empt the market in high-speed Internet access during a key phase in its development."

The court ruling may be appealed to the upper Court of Justice of the European Communities.

Copyright AFP

Subject: French news

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