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Ofcom Office of Communications

Ofcom launches Competition Act investigation into new BT retail tariff packages for line rental and calls

London (ots)

Ofcom today announced it had opened an
own-initiative investigation under Chapter II of the Competition Act
into BT's new residential retail tariff packages for line rental and
calls, the first of which BT intends to introduce on 1 April 2004.
The investigation will examine whether the introduction of BT's
new retail tariff packages constitutes an abuse of a dominant
position under the Competition Act 1998.
Ofcom has received representations from 13 stakeholders including
other operators who compete with BT in the provision of voice calls
in the residential market by offering consumers a Carrier Pre-Select
(CPS) service. These CPS operators need to route calls over BT's
network using a wholesale service provided by BT. To date almost
three million UK households have switched from BT to the services
provided by CPS operators.
The CPS operators have raised concerns that BT's retail tariff
packages for line rental and calls, when combined with the wholesale
price that they must pay BT for call conveyance, will distort
competition in the provision of residential calls.
Under section 25 of the Competition Act, Ofcom may conduct an
investigation if there are reasonable grounds for suspecting that the
Chapter II prohibition has been infringed.
As a matter of urgency, Ofcom is considering the case for seeking
interim measures under the Competition Act. If Ofcom concludes that
there is a case for the interim measures, the options available would
include a requirement upon BT to cease or reverse the proposed new
tariffs. Ofcom expects to reach a conclusion on whether interim
measures are appropriate within the next four weeks.
The relevant Competition Bulletin can be found at
Ofcom is the independent regulator for the UK communications
industries, with responsibilities across television, radio,
telecommunications and wireless communications services.
Our duties include:
  • The promotion of choice, quality and value in electronic communications services, where appropriate by encouraging competition between the providers of those services
  • Ensuring the most efficient use of the radiocommunications spectrum - the airwaves used for the transmission of all non-military wireless communications services
  • Ensuring a wide range of electronic communications services, including broadband, is available across the UK
  • Ensuring a wide range of TV and radio programmes of high quality and wide appeal
  • Maintaining plurality in the media by ensuring a sufficiently broad range of ownership
  • The protection of audiences against offensive or harmful material, unfairness or the infringement of privacy on TV and radio
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Ofcom Media Office
Phone: +44/20/7981-3033