portugal: the competition authority issues recommendation...

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• Portugal: The Competition Authority issues Recommendation to Mobile Operators on Prices of Call Origination to Special Services and non-geographic NumbersOn 3 February 2012, the Portuguese Competition Authority (PCA) published a Recommendation No. 1/2012 addressed to the three national mobile network operators (TMN, Vodafone and Optimus) concerning the prices of call origination to special services and non-geographic numbers.

The PCA recommended that, before 31 July 2012, the three operators re-evaluate the adequacy of their prices of call origination to special services and non-geographic numbers taking into consideration the costs of this wholesale service. Should the recommended re-evaluation not be carried out, and thus fail to address the identified competition concerns, the PCA will open formal infringement proceedings against the operators, with the possible imposition of sanctions. This potential intervention would not be bound in any way by the Recommendation.

Call origination to special services and non-geographic numbers are services provided by mobile phone operators whereby they originate a call that is terminated on a different network. Special services and non-geographic numbers include costumer support, information services, telephone voting and free calls, among others.

This Recommendation follows an economic study carried out by the PCA after a communication from the National Telecoms Regulator (ICP – ANACOM) and several complaints regarding prices. The analysis carried out by the PCA took into consideration the retail market of telephone services to special services and non-geographic numbers, and related wholesale markets.

The PCA concluded that the profits are clearly above those expected from a competitive undertaking, even above those observed for similar services by the operators themselves. Therefore, the economic margin per unit is high, indicating the possible existence of excessive profits.

The PCA also concluded that the high prices of call origination to special services and non-geographic numbers have a negative impact on competition, insofar as they harm undertakings that use them to offer retail services consisting in phone calls to special services and non-geographic numbers. On the other hand, the high prices harm consumers of mobile telecommunications services who are deprived of access, or bear the high costs of access to those services.

See Recommendation (in Portuguese)