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Press release

Active competition on the broadband market

Berne, 13 November 2008

The Secretariat of the Competition Commission has submitted an application to the Commission to issue sanctions regarding Swisscom's abuse of its market dominant position in the area of ADSL services and has asked Swisscom to make a statement on the matter. Swisscom will examine the draft decree. The company is surprised by the content and timing of the application, since there is currently a case before the Federal Administrative Court to evaluate the question of possible market dominance. Swisscom also questions whether the Competition Commission has the legal authority to impose sanctions in such cases.

The application to the Competition Commission envisages sanctions in the amount of approximately CHF 237 million as a result of allegedly overpriced ADSL setup services. Swisscom rejects these allegations and regards the sanctions as unjustified. On the one hand, the decree is based on the presumption that Swisscom occupies a dominant position in the market for ADSL services; this very question is currently being discussed by the Federal Administrative Court, with a decision due to in the near future.

On the other hand, the Federal Administrative Court is also clarifying whether sanctions may be imposed on a company's pricing policy if there was no legal ruling on market dominance when the company set its prices and the company was completely unaware of the prices deemed acceptable by the Competition Commission.

Swisscom is thus surprised that this proposal is being made at a time when such fundamental issues are pending before the top authority of the Competition Commission. Until there is legal security regarding these issues, Swisscom will not be making any provisions. Swisscom will examine the draft decree and make use of the opportunity to justify its position. We can contest the forthcoming Competition Commission decree by lodging an objection with the Federal Administrative Court and, in the last instance, with the Federal Court.


Swisscom does not perceive a case for market dominance

Infrastructure competition is alive and well in Switzerland. Cable network operators have also invested intensively in their own infrastructure, and more than 80% of households in Switzerland have the choice between cable Internet and ADSL. The Secretariat of the Competition Commission fails to take account of the fact that cable network operators could also offer broadband setup services, but instead chooses to declare Swisscom's market position as dominant because cable network operators have decided that they themselves do not wish to offer such services. Some smaller cable network operators have higher market shares in their local markets than Swisscom.


Swisscom AG
Media Relations
3050 Bern