EU To Scrutinize Czech Telecomm

By Czarina Ara Lasco

Oct 27, 2016 06:19 AM EDT

Since 2011, the two companies started to work together and since been increased in scope to include 3G and 4G data services and covers all of the country with the exception of Prague and Brno. The cooperation between the two companies, increased their clients to up three-quarters of the Czech market.

With worry that the deal will slows down quality improvements in existing infrastructure or delays the deployment of new technologies as well as new services, the Commission said it would investigate on the case.

"Network sharing agreements can bring about efficiencies, such as reduced deployment costs and may allow for network expansion to previously unserved areas. But, in some circumstances, network sharing may also reduce competition on the market. The network sharing agreement between the two major operators in the Czech Republic covers most of the country. We need to ensure that it will not reduce infrastructure competition and innovation," said Margrethe Vestager, EU Commissioner in charge of competition policy.

Vodafone is a smaller mobile network operator compare to the other two and apparently not a party to the network-sharing agreement.

O2 CZ/CETIN and Deutsche Telekom unit T-Mobile CZ will have to terminate their agreement or amend it if they were found guilty to be in breach of EU competition regulations.

CETIN is a telecommunications company that is part of PPF Group. It is created as a result of the separation from O2 Czech Republic last year. Its owner is the Czech businessman billionaire Petr Kellner, who also keeps over 84 percent of the shares in O2 Czech Republic. As of the moment, no one at CETIN could be reached for comment or statements.

 "The network-sharing deal was positive for customers," said T-Mobile CZ

A spokeswoman from the T-Mobile said that we are closely cooperating with the European Commission in the given matter.

"We are convinced that cooperation in the area of network sharing does not curb competition nor innovations. On the contrary it brings benefits to end-customers," she added.

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