Brussels’ Orange alert

THE planned €18.6 billion merger between Orange and MasMovil can expect scrutiny from Brussels.

The European Union’s Competition Commission, headed by Magrethe Vestager, is launching an in­depth investigation that will assess all aspects of the Orange­MasMovil merger.

“The Commission is concerned that the transaction may reduce competition in the retail supply of mobile and fixed broadband services as well as of multiple­play bundles in Spain,” a Commission statement said.

Orange and MasMovil are respectively the second and fourth largest operators both at retail and wholesale level for fixed broadband and mobile services in Spain, the Com­ mission pointed out, citing Telefonica, Vodafone, Orange, and MasMovil.

“There are also several mobile and fixed virtual network operators which use these operators’ infrastructure to offer mobile and fixed telecoms services to their consumers,” the release continued.

The Commission concluded that by reducing the number of Spain’s network operators, the merger would also eliminate “innovative and significant rivals” which could then lead to higher prices and lower­quality telecom services for customers.

Once merged, Orange and MasMovil would have “the ability and the incentive” to restrict virtual operators’ access to the wholesale mobile network, the Commission said.

“This could reduce the ability of such operators to compete, and in turn lead to higher prices and lower quality of services for end customers in Spain.”

The Competition Commission now has 90 working days, until August 21, to come to a decision.