At the request of Telenet, the Belgian Competition Authority imposes an interim measure on the Proximus - Orange Belgium joint venture: a step in the right direction
The investigation on the merits of the case will continue
Brussels, 10 January 2020. On Wednesday, 8 January 2020, the Belgian Competition Authority (BCA) took a decision regarding an application from Telenet for interim measures to be taken against the joint venture between Proximus and Orange Belgium regarding the sharing of mobile infrastructure. Telenet had asked the BCA to suspend the operation and activities of this joint venture. At the request of Telenet, the BCA has imposed an interim measure on Orange Belgium NV and Proximus NV. According to the decision of the BCA - considering a possible impact on the competition -the agreements between Orange Belgium and Proximus regarding bringing their mobile networks together must be suspended up to 16 March 2020, in order to allow the BIPT to further investigate these agreements and the recent changes made to them. Orange Belgium and Proximus must inform the Competition College and the Prosecutors of the BCA about their discussions with the BIPT, and the attitude of the BIPT in this regard. As far as Telenet is concerned, this is a step in the right direction, but it remains important that the BCA and the BIPT now carry out further thorough investigations into the joint venture, taking into account the objections that Telenet has already announced. The investigation regarding the merits of the case will continue in any case.
Telenet is satisfied that the BCA has imposed an interim measure on Orange Belgium and on Proximus, but stresses that both the BCA and the BIPT must now carry out a further thorough investigation into the joint venture, taking into account the objections previously formulated by Telenet, the concerns of the BIPT during the procedure before the BCA, and the position of the European Commission in other cases.
In the case of a similar but less far-reaching joint venture between O2/CETIN and T-Mobile in the Czech Republic, the European Commission expressed serious objections, and pointed out that this kind of collaboration restricts competition and is consequently detrimental to innovation.
In the context of the proceedings before the BCA, the BIPT voiced its concerns over the impact of the joint venture on competition in the mobile markets and confirmed that an examination of the merits by the BCA is necessary in this case.
The pressure on mobile revenues is prompting all mobile operators to find smart ways to finance the development and maintenance of the new 5G network. Telenet understands why mobile operators - albeit within the limits of what is legally permitted - want to share their mobile networks, but has serious reservations about the very far-reaching manner in which the two biggest mobile players in Belgium - with a joint market share of 75% and a quasi-monopoly in the business segment - want to work together in a joint venture. This collaboration involves sharing active equipment for the whole Belgian territory and for all technologies (2G, 3G, 4G and 5G). A far-reaching collaboration between Proximus and Orange Belgium also means that the number of infrastructure players would be reduced from three to two.
According to the guidelines of BEREC, the body of European telecom regulators, on the sharing of mobile networks, such a situation is typically regarded as problematic, because it drastically diminishes the incentives for intense infrastructure competition.