Slovak and German Telekom will pay millions in fines

The EU Court of Justice dismissed appeals lodged by Slovak Telekom and German Telekom against judgments of the General Court concerning anticompetitive practices in the Slovak telecommunications market. This means that the fine of EUR 38.061 million imposed jointly and severally on the two companies, as well as the fine of EUR 19.030 million imposed only on German Telekom, remain unchanged. A court in Luxembourg has stated that Slovak Telekom (ST), as the historic telecommunications operator in Slovakia, provides high-speed services through its fixed copper and optical networks. ST networks also include a "subscriber connection", i.e., physical lines that connect the subscriber's telephone socket to the main switchboard in the fixed telephone network. Following an analysis of its national market, the Slovak National Telecommunications Regulatory Authority adopted a decision in March 2005 designating ST as an operator with significant influence on the wholesale market for unbundled access to the local loop. As a result, ST was obliged under the Union regulatory framework to provide alternative operators with access to the local loop it owns, thus allowing new entrants to use this infrastructure to provide their own services to end-users. In October 2014, the European Commission (EC) decided to sanction ST together with the parent company German Telekom AG (DT) for abusing its dominant position on the Slovak market for high-speed Internet services by restricting access of alternative operators to its local loop in the period from 2005 to 2010. The Commission criticized both companies for setting unfair terms in the reference offer for unbundled access to their local loop and for imposing disproportionate prices which did not allow an equally efficient operator to reproduce ST's retail services without loss. For that reason, the EC imposed a fine of EUR 38 838 000 on ST and DT jointly and severally, as well as a fine of EUR 31 070 000 on DT alone.