The Competition Authority of Norway (Konkurransetilsynet) fines Norwegian telecommunication giant Telenor over misusing its market power to prevent a third mobile network from establishing in Norway. The company receives 788 million NOK (97 million USD) penalty. The company disagrees with the decision, writes NRK.
– The Competition Authority has concluded that the company deliberately put obstacles in the way of the development of a third mobile network in Norway, says Lars Sørgard, director of the Norwegian Competition Authority.
Sørgard points out that it is a serious breach of the competition law, when the dominant players in this way prevent competitors from establishing.
Telenor on the other disagrees with the Competition Authority’s decision.
– We have worked well with the Competition Authority and organized for their work all the way. We disagree that we have violated the Competition Act, “says Berit Svendsen, Managing Director of Telenor Norway in a press release.
Here’s what Telenor allegedly did to trigger a 788 million fine
In November 2016, the Competition Authority announced that they considered fining Telenor NOK 906 million for allegedly misusing their dominant position to hinder the possibility that a third competing mobile network could establish itself in Norway.
This was about a case in the period of 2010-2014. The background for the case was that Network Norway was to build a third mobile network in Norway together with Tele2 in 2007.
During the development period, Telenor was obliged to provide these operators with access to Telenor’s network in those areas where the third network was not fully developed.
The Competition Authority’s preliminary assessment in the autumn of 2016 was that Telenor had abused its dominant position by charging high fees for network use to reduce profitability in the development of the third mobile network. Also the audit pointed out that Telenor entered into exclusive agreements with four mobile operators, thus limiting the ability of the third mobile network to find customers.
In December 2012, the Norwegian Competition Authority and the EFTA Surveillance Authority ESA conducted a raid at Telenor Norway and Telenor ASA.
Now the investigation has been finalized. The penalty has been reduced to NOK 788 million.
Mobile networks in Norway
Norway is one of the few countries in the world that only has two nationwide mobile networks, owned by Telenor and Telia. It limits competition. Mobile operators without their own nationwide network must use Telenor’s or Telia’s network. Due to lack of competition, the Norwegian market is still regulated.
The establishment of a third mobile network has therefore been central to achieving increased competition in the Norwegian mobile market, according to the Norwegian Competition Authority.