EU weighs up blame in fine on Telecom

Legal problems in the drafting of a justification for an expected EU fine against Telecom Eireann of between £10 and £15 million have led to further delays in a formal European Commission decision on the fine.

At stake is understood to be an argument about the extent of Government responsibility for Telecom's breach of EU competition rules, and hence, potentially, a question of share of liability. The Commission's ruling on a 1994 complaint from Esat Telecom that Telecom Eireann had abused its dominant position by overcharging for access to its network has now been held up for several weeks.

Sources say the problems have arisen because of concerns in the Commission's legal services about references in the ruling to changing Government advice to Telecom in 1996 about the extent of the company's obligations under the EU's complex liberalisation programme.

The advice to Telecom Eireann is understood to have changed when Mr Alan Dukes took over as Minister from Mr Michael Lowry who had interpreted the company's obligations in a very limited way.

The file has also been delayed because of changes in personnel in the competition directorate dealing with the issue.

Esat complains that Telecom refused until 1994 to give it access to its lines and that when it did the rates it proposed to charge did not bear any relationship to the real cost of providing the service.