350 million euros! This is the highest fine ever imposed on a single company, recognizes the Competition Authority. In the dock, Orange, sentenced for abuse of dominant position. The AMF accuses him of “having implemented four anti-competitive practices in the markets for fixed and mobile services to enterprises.” It requires that Orange immediately restore “a situation of healthy competition”
The outstanding amount of the fine is partly explained by the size of the sector. The professional market in 2013 accounted for 10.6 billion euros in France, 30% of the global market, according to the latest report from Arcep. “The penalty is proportional to the total turnover of the company, explains Frédéric Puel, lawyer and partner at FIDAL responsible for competition pole, knowing that the authority can not impose a fine exceeding 10% of this turnover, business”. But the Competition Authority has also given the many precedents in the sector. Between the various agreements on tariffs in mobile telephony and abuse of dominant position, telecoms have continued to circumvent the rules of competition. Orange has been repeatedly condemned for abuse of dominant position, while SFR was also sentenced for the same reason in French overseas territories.
mobile side, Orange Business Services has implemented over a long period an abuse of its customer loyalty program with cumulative tariff discounts contingent on duration or volume commitments. Fixed service side, the Authority sanctions the access and use of information from the management of the local loop owned by the ancient historical monopoly. Basically, Orange took advantage of inside information that had no competition. “Orange is always exerts a dominant position for its part considers Arcep (Regulatory Authority for electronic communications and postal services), and competitive practices are particularly unacceptable.”
What impact?
Orange has chosen a procedure of non contestation complaint and accepted the decision. “We chose to cooperate, says do we at Orange, we do not dispute the complaints thereby terminate the procedure, which lasts for eight years.” The Competition Authority confirms that version and said that Orange has effectively chosen to cooperate and should pay the fine without appeal. “We have provisioned a sum few weeks ago in anticipation of this penalty, said Orange. This will have no impact on our accounts.”
The reality may be different. The Competition Authority asked Orange to set up “a system ensuring the provision of information to operators of the copper local loop from the same sources, within the same period, under the conditions and at the same level of reliability and performance as that enjoyed its own commercial services. ” This time, it will be difficult to avoid conviction, ARCEP is committed to ensure the proper compliance of the device. The impact may be very real about the market share of the incumbent: it held nearly 47% of the mobile professional market and nearly 85% of the professional market of fixed telephony in 2011 according to Arcep. The injunctions of the Competition Authority should cause it to reduce its market share. But this market is crucial for him, its market share in value is substantially greater than its market share in the park, while those of Bouygues Telecom are substantially equal, and the market share in value of SFR is significantly lower than its market share in the park. A drop, however small, its market share by volume will have a comparatively large impact on its sales.
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