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January 19, 2010

Bundeskartellamt publishes position paper on broadband expansion

Today the Bundeskartellamt has published its position paper “Instructions on the competitive assessment of cooperations in optical fibre expansion in Germany.”  The paper is to serve as a guide to companies planning to cooperate with competitors in this area in assessing their cooperation plans under competitive law. The Bundeskartellamt has published this instruction leaflet in compliance with a request from the federal government as part of its broadband strategy.  
The paper focuses on Deutsche Telekom AG's cooperation with competitors to upgrade existing broadband connections for bandwidths of 50 Mbit/s or more.  Cooperations purely on the development and first-time supply of broadband connections in so-called “white spots” are normally unproblematic under competition law.
Whether a planned cooperation in broadband expansion can limit competition depends above all on the type of cooperation and the market position of the companies concerned. In assessing such cooperations the Bundeskartellamt checks whether inadmissible price agreements have been concluded and whether the cooperation limits effective infrastructure competition. Cooperations on broadband expansion can be exempted from the ban on cartels under certain conditions as long as there is no evidence of illegal price agreements. The conditions for exemption are explained in detail in the position paper to help the companies provide the necessary proof that they have fulfilled these requirements.

The position paper is available (in German only) on the Bundeskartellamt’s homepage.