Telecom liberalisation plans suffer setback

Swisscom keeps its "last mile" monopoly for a little longer than expected Keystone

Plans to remove the final obstacle to a more liberalised telecommunications market in Switzerland have suffered a setback.

This content was published on December 10, 2004 - 15:27

The Federal Court ruled on Friday that current Swiss law does not require the country’s leading telecoms provider, Swisscom, to end its monopoly of the local loop.

The local loop – also known as the “last mile” - is the last stretch of the telephone line between local exchanges and households.

The Federal Court’s ruling overturns a decision earlier this year by the Federal Communications Commission, which had wanted to force Swisscom to open the last mile to competition.

The decision is also a slap in the face for the government, which announced in February 2003 that it wanted to open up the last mile as “rapidly” as possible.

Final hurdle

Two months ago the House of Representatives, one of Switzerland’s two parliamentary chambers, also voted in favour of removing the final hurdle to a more liberalised telecoms market.

But the Lausanne-based Federal Court has taken a different view of the situation.

It said the existing telecommunications law could not be used as a basis for forcing Swisscom to abandon its monopoly.

Swisscom spokesman Sepp Huber welcomed the court ruling.

“For Swisscom, this is a positive decision, because we think there is no need for additional regulations,” Huber told swissinfo.

“It is not necessary because there is already stiff competition between Swisscom and cable-network operators.”

Swisscom, which is majority-owned by the Swiss government, has insisted that an opening of the local loop to competition would keep it from investing in that part of the network.

Freedom of choice

The company has stressed that customers already have the choice of shopping elsewhere, because rival Cablecom is now offering alternative digital telephone services via its broadband cable network.

But another Swisscom rival, Sunrise, said it regretted the court decision, arguing that it would only serve to harm Switzerland’s reputation as a place to do business.

The issue now returns to parliament, which will have to debate modifications to the communications law if the liberalisation plans are to be pushed through.

The president of the Communications Commission, Fulvio Caccia, said the court decision was likely to delay the plans by several months.

He added that it was possible that the law could be modified in the early part of 2006, before coming into force towards the end of that year.

swissinfo with agencies

In brief

The Federal Court in Lausanne has ruled that current legislation does not force Swisscom to open up the “last mile” to competition.

It says the text of the relevant legislation is too vague.

The president of the Federal Communications Commission, Fulvio Caccia, says the decision could delay the liberalisation of the last mile by several months.

An amended law could come into force at the end of 2006.

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