CC looks at Openreach price controls
23 Aug 2012
The Competition Appeal Tribunal (CAT) has referred an appeal by BT over proposed price controls to the Competition Commission (CC). BT is challenging Ofcom over the prices it will allow Openreach, a division of BT Group, to charge communication providers for access to some of its wholesale telecoms services.
The price controls relate to wholesale charges for telephone and broadband services delivered to homes and businesses over BT’s copper network in two ways:
Local Loop Unbundling (LLU), which allows communications providers to install their equipment in BT’s local telephone exchanges to provide broadband and telephone services to their customers; and
Wholesale Line Rental (WLR), which is used by communications providers to offer telephone services to consumers using lines rented from BT. LLU can be supplied alongside or in combination with WLR.
The charges are expected to cover the period 2012–2014 and were announced by Ofcom in March 2012.
BT is challenging Ofcom’s decision on a number of grounds. For more details on the appeal, please visit the CAT’s website. The CC has until 29 March 2013 to determine the pricing issues.
Sky and TalkTalk have also challenged Ofcom’s decision in a separate appeal to the CAT, which is expected to lead to a similar reference to CC. Sky and TalkTalk have been granted permission to intervene in BT’s appeal and BT has been granted permission to intervene in the Sky/TalkTalk appeal. Everything Everywhere is intervening in both appeals.
Under the 2003 Communications Act, if decisions by Ofcom are appealed to the CAT and include a price control matter, then this matter must be referred to the CC for determination.
Notes to editors
1. The CC is an independent public body, which carries out investigations into mergers, markets and the regulated industries.
2. The CAT hears appeals against decisions made by the Office of Fair Trading, the CC and sectoral regulators such as Ofcom. For further information relating to the appeal, see the CAT’s website (British Telecommunications PLC v Office of Communications (LLU/WLR Charge Control March 2012), Case number: 1193/3/3/12).
3. Openreach was established in 2006 following Ofcom’s ‘Strategic Review of Telecommunications.’ Since 2006, Ofcom has set the prices which Openreach can charge so that its wholesale services are available to other communications providers on an equivalent basis to BT.
4. Enquiries should be directed to Rory Taylor or Siobhan Allen on 020 7271 0242.
