Swisscom to pay 7.9 million fine
In its investigation into Swiss Post’s 2008 tender for a corporate network, the Competition Commission has concluded that Swisscom violated the Antitrust Act. Swisscom disputes these allegations and will challenge the ruling and the fine.
According to the Competition Commission, it was not possible for other providers to make a competitive offer to Swiss Post due to excessive wholesale prices. In addition, Swisscom's offer price was unreasonable. "We are convinced that we acted correctly," says Swisscom CEO Urs Schaeppi. "We attach great importance to compliance with antitrust law." When calculating the offers for end customers, Swisscom took into account the costs incurred by other providers. Some of the other providers can use their own infrastructures and also purchase regulated services from Swisscom at cost-oriented prices in accordance with the Telecommunications Act, as well as commercial advance services. However, Swisscom is not obliged to provide commercial wholesale services at cost-oriented prices.
In Swisscom's view, the allegations of abuse are not justified. Swisscom will therefore appeal the ruling and the fine to the Federal Administrative Court.
Tender dates back to 2008
In 2008, Swiss Post issued a new invitation to tender for the broadband connection of its sites. Following the suitability test, it invited Sunrise, UPC Cablecom and Swisscom to submit an offer. In January 2009, it awarded the contract to Swisscom's bid. Sunrise responded by filing a complaint against Swisscom with the competition authority. It claimed that it should have paid a price for the required advance services that was higher than Swisscom's offer for Swiss Post. The excessive wholesale prices were the reason why it was unable to make a competitive offer to Swiss Post. Swisscom had practiced a margin squeeze and thus violated the Cartel Act.
In summer 2009, Swisscom demonstrated to the Competition Commission that Sunrise would have been in a position to submit a competitive offer if it had made sensible use of its own and upstream services, according to a press release issued by Swisscom on Thursday. Competitors who could only have used commercial inputs for the Swiss Post contract due to a lack of their own infrastructure (e.g. cable networks, own fiber optics) were not invited by Swiss Post to submit a bid; Swisscom was therefore unable to hinder such competitors in the tender. The accusation of abuse to the detriment of Swiss Post is also incomprehensible: The latter negotiated large price discounts in the negotiations. Swisscom had to give in to Swiss Post's demands in order not to lose it as an important customer, the press release continues: "Swisscom's offer had the lowest price. It was therefore in line with the market".
For this reason, Swisscom considers the allegations of abuse to be unjustified and will contest the ruling and the fine before the Federal Administrative Court.
