PRESS RELEASE: Council of the Czech Telecommunication Office proposes temporary regulation of the wholesale market
Prague, 1 March 2022 - Following the comments from BEREC and the European Commission, the Czech Telecommunication Office (CTU) has re-analysed relevant market No.3 - the wholesale market for access to mobile services. Based on its findings, CTU has launched a public consultation on a new draft analysis with specific proposals on temporary measures.
CTU concluded, in line with BEREC and other expert views, that the market is not an effectively competitive market within a time horizon of up to 2 years. There are undertakings with significant market power and the effects of the 700 MHz auction obligations will not be felt in the meantime. It is therefore necessary to act urgently to protect competition and the interests of users in compliance with Article 32(10) of the Code and Article 131(5) of the Electronic Communications Act and to introduce temporary measures, in particular to prevent certain competitors from being squeezed out of the retail market. CTU has launched a public consultation on the draft, which will run until 8 March 2022.
CTU finds that remedies under national or EU competition law are not sufficient to address this issue.
"The Czech Telecommunication Office is a regulatory authority, so I believe that it must try to influence prices, which are among the highest in Europe, by means of regulation. The law gives us that possibility. Council of the Czech Telecommunication Office did not consider it justifiable to do nothing. We hope that the proposed specific regulatory packages will contribute to reducing prices on the retail market," said CTU Council Chair Hana Továrková.
Based on the relevant market analysis, CTU proposes to designate T-Mobile Czech Republic a.s., O2 Czech Republic a.s., and Vodafone Czech Republic a.s. as undertakings with significant market power on this market.
CTU proposes to impose obligations on the three operators to offer two regulatory packages of mobile services in all their current mobile network access contracts (2G, 3G, 4G and 5G). The regulation of the prices of packages will take the form of a prohibition of margin squeeze combined with setting the maximum wholesale price for the regulatory packages. All three mobile network operators will be obliged to provide access on non-discriminatory terms to both packages, including for newly contracted MVNOs. The regulation will be limited in time to 18 months from the day the remedies will come into effect.
Czech Telecommunication Office