Deutsche Telekom Gets EU Fine Over Slovak Broadband

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Deutsche Telekom AG was fined 31.1 million euros ($39.3 million) by European Union antitrust regulators and must share a 38.8 million-euro fine with its unit Slovak Telekom AS for thwarting Internet competitors.

Slovak Telekom ran an “abusive strategy” that blocked rivals’ access to networks and charged unfair wholesale prices that prevented competitors from making a profit, the European Commission said in an e-mailed statement today.

“Slovak Telekom’s strategy has distorted competition in the broadband market in Slovakia during more than five years, to the detriment of competition and consumers,” EU Competition Commissioner Joaquin Almunia said in the statement.

The clash with Bonn-based Deutsche Telekom and its unit follows the EU’s move to drop earlier probes into whether the company and rivals colluded to stifle Internet connectivity or to set technology standards. The EU fined the then France Telecom SA’s Polish arm 127.6 million euros in 2011 and fined Spain’s Telefonica SA in 2007 for undercutting competitors by selling high-speed services at a loss.

Deutsche Telekom received a separate fine of 31.1 million euros “to sanction its repeated abusive behavior” after a 2003 EU fine for its actions in the German Internet market, the EU said. The EU said it is jointly liable for Slovak Telekom’s fine because it had “decisive influence” over its subsidiary.

Deutsche Telekom can’t understand the EU decision because it “always assumed that Slovak Telekom behaved in a way that conformed to competition,” said a company spokesman Andreas Middel by e-mail. The firm will challenge the fine at the EU courts in Luxembourg, he said.

Deutsche Telekom, which owns 51 percent of Slovak Telekom, has said it sees “no basis” for the EU holding it liable for the unit’s actions.