By Foo Yun Chee
BRUSSELS (Reuters) -Europe’s biggest telecommunications companies urged the head of the European Commission on Tuesday to loosen EU merger rules, a move they said would boost much-needed investments in digital infrastructure and help them compete with U.S. and Asian peers.
The call by the chief executives of Deutsche Telekom, Orange, Telefonica, TIM, Vodafone, Nokia and Ericsson comes as the Commission is set to announce a legislative proposal to revamp the sector.
The Digital Networks Act, currently scheduled to be unveiled in November, aims to take a more comprehensive approach to help ramp up digital infrastructure across Europe.
It hit a stumbling block last week, however, when an internal Commission body issued a negative opinion on the legislation, according to a person with direct knowledge of the matter.
“The Digital Networks Act is a crucial opportunity,” the CEOs wrote in a joint letter to Commission President Ursula von der Leyen.
“Unless the Commission takes bold action with a clearly stated intent to address the need for scale, European industries will continue to lack the strength to invest at the same pace as their competitors in the United States, Asia and other markets,” they wrote.
The telecoms industry has voiced concern the DNA will ignore their calls to ease the path for large mergers, particularly those which reduce the number of players in a market from four to three. Antitrust regulators have long viewed that level of consolidation as a precursor to price hikes considered harmful to consumers.
“The Commission must act boldly to recognise the link between scale and investment, and a much simplified regulatory framework that increases investment capacities,” the executives said.
Other signatories to the letter included BT Group, CK Hutchison Group Telecom, KPN, Liberty Global, FiberCop, Swisscom and Telenor.
(Reporting by Foo Yun Chee; Editing by Joe Bavier)
