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Telekom, EWE submit binding commitments to comptroller for fibre joint venture approval

6 Dec 2019

Telekom Deutschland and EWE have submitted a list of proposed commitments and concessions to German antimonopoly authority the Bundeskartellamt to gain approval for their planned joint fibre-optic network development in parts of Lower Saxony, North Rhine-Westphalia and Bremen, including pledges to undertake far-reaching expansion and to grant network access to third parties. The commitments include:

• upgrade 300,000 end-user connections with fibre in four years via private, not public funding, ‘to some extent also in rural areas’

• both operators to continue independently participating in tenders for funding of gigabit-ready telecommunication networks, especially in rural areas ‘where commercial development is not possible’

• refrain from ‘specific strategic defence measures vis-a-vis telecommunications companies also intending to expand fibre-optic networks, and from solely focussing on urban areas which already have cable networks’

• grant third-party operators non-discriminatory access to the new network and to high-quality technical upstream services; ‘within a specific period a certain share of the expanded connections will be handed over to competing telecommunications companies which can then market them to the end customers’.

In a formal decision issued 5 December 2019, ‘limited to six years’, the Bundeskartellamt declared the commitments as binding, but added: ‘The decision is not yet legally binding.’

Telekom and EWE first communicated their intention to cooperate in fibre-optic deployment to the Bundeskartellamt at the end of 2017. They subsequently negotiated specific arrangements for the cooperation, and formally notified the proceeding to the comptroller on 21 March 2019.

Apart from the assessment of the planned cooperation under anti-cartel law, the proposed establishment of a joint venture is also subject to merger control by the Bundeskartellamt. The merger control proceeding must be concluded by January 2020.

(For further information see Bundeskartellamt link below.)

Germany, EWE, Telekom Deutschland

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