EC Vindicated By CFI In French Broadband Case

by Ulrika Lomas, for LawAndTax-News.com, Brussels

01 February 2007

The European Commission has welcomed the judgment delivered on Tuesday by the Court of First Instance, dismissing in its entirety the appeal by France Télécom SA, (formerly Wanadoo Interactive SA), in respect of the Commission's 2003 decision concerning predatory pricing, and confirming the EUR10.35 million fine imposed by the Commission.

In July 2003, the Commission fined Wanadoo EUR10.35 million for charging "predatory", or below cost, prices for its Pack eXtense and Wanadoo ADSL services.

The Commission decision held that Wanadoo had a dominant position in this market. The Commission found that, from March 2001 up to October 2002, the retail prices charged by Wanadoo were below cost. The practice coincided with a company plan to pre-empt the strategic market for high-speed Internet access.

This practice restricted market entry and development potential for competitors, to the detriment of consumers, on a market which is key to the development of the information society.

The CFI this week rejected Wanadoo's appeal in its entirety, and confirmed all aspects of the Commission decision. The Court also confirmed the Commission's approach as regards the calculation of the fines imposed on the company.

In addition, France Télécom SA has been ordered to pay the Commission's costs with regard to the CFI proceedings.

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