France’s competition authority, the Autorite de la Concurrence, has opened ex officio proceedings to review the conditions surrounding the divestiture of Numericable’s assets in the French overseas territories of Reunion and Mayotte.
As previously reported by TeleGeography’s CommsUpdate, in October 2014 the anti-trust authority granted a conditional approval to Numericable’s proposed acquisition of French telco SFR. In order to gain the regulator’s approval, the combined SFR-Numericable entity has to divest its mobile operations in Reunion and Mayotte, as the overlapping activities of SFR and Numericable in the two territories would give the enlarged entity significant market power in the Indian Ocean (66% market share in Reunion and 90% in Mayotte).
While the sale process of Outremer Telecom (Reunion) and Outremer Telecom (Mayotte) is currently underway with several bids for the assets already being placed, the Autorite de la Concurrence has expressed its concerns in regards to the conditions surrounding the divestiture and in particular, the recent increases in the ‘RIFE 2h’, ‘Trio’, ‘Jeune’, ‘Next’, ‘On’ and ‘Next2 Illimite’ mobile tariffs in the two French overseas territories. To that end, the anti-trust regulator decided to assess whether the January 2015 hike in mobile subscription fees is in compliance with Numericable’s commitments to ‘preserve Outremer Telecom’s viability, market value and competitiveness until the divestiture’. If Numericable is found to have failed to meet its obligations, Autorite de la Concurrence could issue fines of up to 5% of the company’s turnover in France.