CNDC rejects TI’s appeal

16 Apr 2009

BNamericas has reported that Argentina’s anti-trust agency, the National Commission for Competition Defence (CNDC), has rejected Telecom Italia’s (TI’s) appeal against the regulator’s ruling barring the telco from making any decisions regarding its local subsidiary, Telecom Argentina. An investigation was opened after Spain’s Telefonica joined a consortium that acquired a 24.7% stake in TI in October 2007. TI owns a 50% stake in the Sofora holding company that controls Telecom Argentina. When Argentina’s telecoms sector was privatised in the 1990s its fixed line services were divided between Telecom Argentina and Telefonica de Argentina, with a government directive stating that there should be no cross-ownership between the two. In early-April 2009 the CNDC ruled that TI’s directors be stripped of their voting powers in Telecom Argentina. The Italian company appealed the agency’s decision the following week, stating: ‘The resolution results in the absolute, arbitrary and unreasonable trampling of [the company’s] rights and constitutional guarantees… stripping its property rights and granting these to the minority shareholder without justification.’