BNetzA abandons case against DT

12 May 2008

German telecoms watchdog Bundesnetzagentur (BNetzA) has dropped its case against incumbent telco Deutsche Telekom (DT) regarding market abuse with respect to unbundling of the local loop. Increased demand for last mile connections from competitors had led to a large backlog of lines needed to be switched over by DT, which in turn led to long delays in rival operators being able to provide telephony and DSL access to their customers. Arcor and Telefonica filed separate complaints with the regulator in December 2007, and a detailed investigation was launched into unbundling by DT. BNetzA’s inquiries uncovered serious doubts about the probity of DT’s unbundling procedures. Head of the regulator Matthias Kurt explained, ‘We have…abandon[ed] the case because DT eliminated the backload under the pressure of possible decisions on our part. At the same time, DT contractually agreed improved local loop ordering and provisioning mechanisms with the competitors who had lodged the case against it. I welcome the fact that DT took the initiative to remove the cause for the accusation of abusive behaviour and did not wait for us to come to a disputed decision. It is always advantageous when disputed issues are solved by voluntary means since

in this way it is possible to avoid legal disputes and subsequent uncertainties for

all market players.’

Furthermore, DT has given the regulator a commitment to improving its procedures and contracts on local loop unbundling, and for the next 18 months will regularly update BNetzA on the current demand for last mile switching. Kurt concluded, ‘I assume that bottlenecks and associated delays in local loop switchovers – such as those prevailing at the turn of the year – will not reoccur in view of the new arrangements and DT’s pledges. The Federal Network Agency will keep a close eye on matters and will not hesitate to intervene should DT not adhere to the agreed arrangements and its commitment. However, I would also like to ask competitors to retain their sense of proportion and to limit their orders to the actual number of local loops really needed for their end customers in order to avoid processing bottlenecks.’