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Telecom Rival Calls for UOHS Conditions

Alternative operator Contactel has filed a complaint with the Czech competition watchdog, the Office for Protection of Economic Competition (UOHS), about the acquisition by Czech Telecom of the 49 percent stake that it doesn't already own in Eurotel, the country's biggest mobile phone company.

The complaint alleges that the deal will strengthen the dominant position on the local market of Telecom, the country's former fixed line monopoly, Contactel spokeswoman Romana Tomasova said. Contactel has since, at the request of the UOHS, provided details of the conditions that it would like imposed on Telecom for the deal to be cleared. These include around 12 demands that would prevent Telecom and Eurotel from merging their fixed and mobile operations, thus creating a Czech telecoms giant.

Among the restrictions, Contactel has proposed that the two companies be prevented from sharing their databases of clients and that cross subsidies between the two companies be banned. Contactel also is demanding that no common tariffs for fixed and mobile services be offered by the companies at the same time. This last condition would prevent the companies from offering joint incentives, such as advantageous call-up rates for customers who use both Telecom and Eurotel.

The competition office has also cast around for comments from other telecoms companies on the deal that would create a "Super Telecom." Cesky Mobil, which operates the network Oskar, the last mobile operator to enter the Czech market and still the smallest, confirmed for PBJ that it was approached by the competition office about the proposed acquisition. "We have been approached by the UOHS with very specific questions about the deal, but at this time I cannot reveal what these were about," said Igor Prerovsky, the new vice-president for brand and communications at Cesky Mobil. Telecom submitted its request for clearance of the purchase of the 49 percent stake in Eurotel from the U.S. consortium Atlantic West for $1.05 million (Kc 29.9 billion) with the UOHS on June 25.

The Anti-Monopoly Office has, according to law, 30 days to deliver an initial response. It can either approve or disapprove the deal or ask for a further four months to investigate it, an UOHS spokesman said.

(PBJ 28.vii.03)

 
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