EU Takes Germany to Court Over Telekom
Legal World
EU regulators took legal action against Germany on Wednesday for Berlin's refusal to change a law shielding Deutsche Telekom AG's high-speed Internet network from rivals.
The European Court of Justice will now have to decide if Germany can keep a law giving Deutsche Telekom a de facto monopoly on a glass-fiber DSL internet network it built to allow it recoup the cost without of setting up an infrastructure with sharing it with others.
The EU executive's arm said this departure from normal regulation breaks Europe-wide telecom rules giving new providers the right to use telephone and Internet networks.
"The Commission has repeatedly warned Germany that its new telecoms law violates EU telecom rules but without success," said EU Telecom Commissioner Viviane Reding. "We want to ensure Germany can benefit from a healthy, competitive and fully functioning market."
Despite last-ditch negotiations, the EU said the German government was unwilling to change the law the way the EU wanted and continued to defend its position.
Deutsche Telekom aims to roll out a high-speed optical fiber network that will transmit data up to 20 times faster than current offerings.
The plan is to provide Germany's 50 largest cities with high-speed broadband lines by 2007. Berlin had agreed with Deutsche Telekom's argument that it could only make a decent profit on the network if it was exempt from any requirement to offer its lines to rivals.
However, the Commission says Deutsche Telekom's heavy share of the German market already give it a major advantage over other companies. It controls more than 9 million telephone lines out of the country's 12.9 million connections.
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