Italy Is Confident on EU Approval for Broadband Merger Plan

(Bloomberg) --

Italy’s government is confident that the European Union will ultimately back its plan to create a single national broadband network under former monopoly Telecom Italia SpA, a minister said.

The government will offer Brussels guarantees that the plan assures telecommunications companies equal treatment and a level playing field, Stefano Patuanelli, minister for economic development, said in an interview in Rome.

“Brussels is aware that the proposed combination is just a first step which will see other telecoms companies involved at later stages,” the minister said, “I don’t see the risk of it blocking the deal, but I definitely see the EU position to advocate for the protection of the free market.”

Telecom Italia is involved in a state-backed plan to create a single network through the separation of its landline grid, which would lead to a national broadband company becoming a monopolist-like carrier.

Bloomberg News reported earlier on EU competition officials’ concerns that a proposed combination of Telecom Italia’s landline network and its smaller, state-backed rival Open Fiber SpA would create a monopoly.

The European Union will always evaluate networks’ independence carefully, antitrust chief Margrethe Vestager said Sept. 18 amid growing tension around the Italian plan.

“The question is of course: Is that an independent wholesaler? Or would a wholesaler also have specific ties vertically to retailers?,” said Vestager, stressing this was the EU’s general policy and not a comment on specific companies.

“That would be an important competition assessment and that would be our general approach no matter what country it would be concerned with,” Vestager said.

©2020 Bloomberg L.P.