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Telecoms: Commission clears Slovenian regulator's decision to maintain regulation on the mobile market

European Commission - IP/09/881   08/06/2009

Other available languages: FR DE SL

IP/09/881

Brussels, 8 June 2009

Telecoms: Commission clears Slovenian regulator's decision to maintain regulation on the mobile market

The European Commission has endorsed Slovenia's telecoms regulator's (APEK) plan to require Slovenia's largest mobile operator, Mobitel, to continue to give competitors access to its network at regulated prices. Unlike most other EU countries, Slovenia's market for wholesale access and call origination services on mobile networks is still not effectively competitive. Competitors, for the time being, still rely on Mobitel's network to provide full national coverage and competitive services to their subscribers. Once they have rolled out their own networks, regulation should be withdrawn.

"Alternative operators must be given sufficient time to climb the investment ladder and roll out their own networks. In Slovenia, competition is still fragile and market entrants are still heavily dependent on Mobitel's nation-wide network. Regulation is needed to speed up competition and give consumers more choice and cheaper prices," said Viviane Reding, the EU Telecoms Commissioner.

Competition Commissioner Neelie Kroes said: " Ensuring competition and consumer choice in Slovenia is at the heart of this regulatory intervention. If only two mobile operators can offer national coverage, then this is not enough to ensure that consumers are well served. I welcome the APEK's plan to continue allowing Slovenia's two smaller mobile phone companies to use the dominant operators network until they have been able to fully roll out their own networks."

In its letter sent on 5 June, the Commission welcomes an updated regulatory measure from Slovenia's telecoms watchdog, APEK, but asks it to further review and back up its claim that the country's leading mobile operator has a dominant market position before implementing the final measure. On 5 May 2009, APEK had notified the Commission of access and price controls it has imposed on Slovenia's leading mobile operator because it found this operator had significant market power in the wholesale mobile access and call origination markets. These obligations allow smaller mobile operators with limited network coverage to provide nationwide mobile services through a national roaming agreement with the leading mobile operator. This would also allow mobile virtual network operators and service providers/resellers to offer mobile communication services to consumers.

In most EU Member States, mobile markets are among the most competitive telecoms markets and access to mobile networks is usually left to commercial agreements between operators. However, in Slovenia, Mobitel the leading mobile operator has around 60% market share, whereas the next operator in size has less than 30%. Two new market entrants are starting to roll out their own mobile networks but still rely on their largest competitor's network to compete effectively for mobile customers.

In its letter the Commission reminds the Slovenian telecoms regulator that wholesale access prices must be at a level that allows new entrants to compete with the more established operators and to invest in network roll-out. They should also encourage other mobile operators to enter the wholesale market for mobile access and call origination. The Commission invites APEK to carry out a new review of this Slovenian market as soon as alternative operators offer wholesale mobile access and call origination services or the smaller new entrants no longer rely on national roaming.

Background:

The Slovenian regulator's draft decision follows a revision of an earlier analysis, after the Commission said it had serious doubts about APEK's finding of December 2008 that the two larger mobile operators jointly held a dominant position on the Slovenian market ( IP/08/1719 ). The measure notified by the Slovenian regulator concerns the second round market review of wholesale mobile access and call origination services in Slovenia. Although this market is no longer included in the list of markets where the Commission recommends regulation ( IP/07/1678 ), a national telecoms regulator may nevertheless decide to regulate if it makes a justified case.

The Commission's letter to APEK, was sent under the " Article 7 procedure ", of the EU telecoms rules' Framework Directive ( MEMO/08/620 ). This leaves considerable scope to national telecoms regulators on how to achieve effective competition, but requires them to notify draft regulatory measures to the Commission. For measures concerning market definitions and analyses of whether operators have significant market power, the Commission can require the regulator to withdraw the measure. For measures concerning regulatory remedies, the Commission may make comments which the national telecoms regulator should take into utmost account. A proposal to enhance the Commission's oversight over remedies is still being discussed with the European Parliament and the Council ( IP/07/1677 ).

The Commission's letter will be made available at:

http://circa.europa.eu/Public/irc/infso/ecctf/library?I=/commissiondecisions


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