Telecom Italia faces probe, but can also expect budget rebate

30 Oct 2007

Italy’s competition authority, L’Autorita Garante della Concorrenza e del Mercato (AGCM), has launched a probe into alleged abuse by Telecom Italia of its dominant market position. The decision to begin an investigation follows complaints from two of Telecom Italia’s competitors in the wireline voice and broadband internet market, FastWeb and Wind. The rivals claim that the former monopoly has been using aggressive commercial tactics to win back former customers who have changed or who are changing service provider. AGCM expects to complete the investigation by the end of next year.

Separately, an Italian court has ordered the government to repay a total of EUR846 million (USD1.2 billion) which was wrongly levied on Telecom Italia and Vodafone Italia in the 1999 budget. Italy’s highest administrative court upheld a 2006 ruling from a lower court following a government appeal. Telecom Italia will be refunded EUR546 million plus around 100 million interest, while Vodafone will receive EUR190 million plus around EUR10 million in interest, Thomson Financial reports.