The European Commission is investigating whether Spanish and Portuguese incumbents Telefonica and Portugal Telecom breached EU rules by agreeing to not compete in their respective home markets.
Their agreement, which runs from September 2010 to the end…
The European Commission is investigating whether Spanish and Portuguese incumbents Telefonica and Portugal Telecom breached EU rules by agreeing to not compete in their respective home markets.
Their agreement, which runs from September 2010 to the end of 2011, was forged as part of Telefonica’s E7.5bn takeover of Brazilian mobile operator Vivo from PT last year.
Announcing the launch of a formal investigation on 24 January, a statement issued by the EC stated that the Brazilian deal itself is not affected by the probe.
The statement continued: “The Commission will also investigate the scope and effects of the co-operation between the parties in Spain and Portugal prior to the 2010 Vivo transaction.
“Telefonica and Portugal Telecom concluded a co-operation agreement in 1997 concerning markets outside the EU, which was notified to the Commission at the time. The Commission will seek to ascertain whether that co-operation may have included a non-compete strategy affecting EU markets, in particular Spain and Portugal, even before the non-compete clause concluded as part of the Vivo deal.”
Telefonica and PT were unable to comment before the press deadline.
