Supreme Court sides with BT on termination charges for non-geographic numbers

10 Jul 2014

British fixed line incumbent BT is set to benefit after the country’s Supreme Court rejected an appeal by domestic mobile network operators regarding a long-running dispute over a rise in fees to non-geographic numbers. According to the Financial Times, the UK’s cellcos may be required to make retroactive payments dating back to 2009 totalling ‘tens of millions of pounds’ on the back of the ruling.

Back in 2009 BT notified mobile network operators of a proposal of a revised scheme of termination charges for non-geographic numbers (those prefixed with the 08 code), with the defining feature of the new scheme being that cellcos would be charged at a rate which varied according to the amount which the originating network charged the caller. All of the nation’s wireless players rejected the plans, however, with Ofcom initially tasked to rule on the matter. While the regulator sided with the cellcos, claiming the charges were not ‘fair and reasonable’, an appeal filed with the Competition Appeal Tribunal (CAT) saw it side in favour of BT, only for the Court of Appeal to restore Ofcom’s original decision.

With the Supreme Court having allowed BT’s appeal and restored the order of the CAT, it is understood that all of the mobile operators in the UK – EE, O2 UK, Vodafone UK and H3G UK (Three) – will have to pay backdated charges on calls to the fixed line operator. The actual amount is, however, expected to be determined via negotiations between the relevant companies.

In the wake of the development, a BT spokeswoman was cited as saying: ‘Such pricing was designed to benefit UK consumers by incentivising the mobile operators to lower their retail prices. We will now start proceedings to recover the money that has been refunded to the mobile operators. We will also be pursuing claims for further termination charges subsequent to that ruling.’ Meanwhile, the Financial Times quoted an EE spokesperson as stating: ‘We are both surprised and disappointed by this decision. We are closely considering our position, but, regardless of the outcome, EE remains firmly of the view that BT’s ladder charges are ultimately harmful to consumers and investment in mobile coverage.’

United Kingdom, BT Group (incl. Openreach), EE, Hutchison 3G UK (Three UK), O2 UK, Vodafone UK