MOBILE PHONE company O2 has confirmed it is to discontinue a service which allows customers of telecoms company Swiftcall to make cheaper calls from landlines to the O2 network.

O2 is to disconnect the Sim cards used by Swiftcall customers to route their calls to mobile numbers using a technology known as GSM gateways. The disconnection will take place at some stage next week. O2 claims that Swiftcall is in breach of the terms and conditions of their contract.

GSM gateways are telecommunications devices which enable fixed-line calls to mobile phones to be rerouted via a Sim card of a particular mobile phone network. Calls which are routed through the system register as mobile to mobile calls, thereby saving money for customers.

Tom McCabe, a majority shareholder in Swiftcall, maintains that the use of the gateways is legal under EU law and that O2 has no right to disconnect the Sim cards under the 1999 RTTE directive governing Radio and Telecommunications equipment.

“O2 are simply not allowed to disconnect us without going to ComReg, and ComReg are not allowed to disconnect us without going to the EU,” Mr McCabe said.

In a letter Swiftcall sent to O2, the company states that, if the Sim cards are disconnected “without full compliance with due process” Swiftcall will pursue both O2 and ComReg “to the fullest extent possible under the laws”.

Swiftcall added it will submit a formal complaint with the European Commission, with a request it opens an immediate investigation, if O2’s decision to terminate the Sim cards is not reversed.

O2 has denied it is in breach of any EU directive. A spokeswoman for the company said O2 has tried to resolve the issue with Swiftcall. “Swiftcall is in breach of the terms and conditions of its contract with O2, and on that basis O2 is proceeding to terminate,” she said. “This does not mean that Swiftcall’s customers are automatically disconnected, rather that the O2 Sims held by Swiftcall will be.”