Commission to take France to court over telecommunications pricing
The European Commission has decided to take France to the European court of justice over telecommunications pricing to ensure France Telecom's competitors are not discriminated against. The decision is the final stage in legal proceedings launched in 1997, and follows a series of Commission initiatives designed to ensure fair competition in a sector where liberalisation is regarded as essential for European companies to be able to compete effectively on the Internet. Recently the EU's executive body announced a series of measures obliging domestic phone-line operators to allow competition on their networks, and unveiled plans to simplify telecommunications regulations to stimulate competition. The action against France arises from the country's scheme for financing the net costs of universal service - the provision of affordable phone services for all. France is the only EU country to have implemented such a scheme - although some others are in the process of considering how it could be done. The Commission stressed it did not want to challenge the principle of France having a scheme for financing the net cost of universal service - which is allowed under Community law. The legal action stems from concern that it has not been implemented in accordance with Community legislation. In particular the Commission is keen to ensure it does not impose barriers to new market entrants by imposing an excessive financial burden. Although the French authorities have made 'considerable progress' since the Commission began proceedings, it said the way the universal service is calculated is 'not in keeping with the principles of transparency, objectivity and proportionality'. The Commission is also uneasy about the lack of economic and accounting evidence of tariff restructuring.