Elisa Communication (formerly the Helsinki Telephone Corporation) was found guilty on May 2 2000 of abusing its dominant position by refusing to offer access to competing internet service providers (ISPs) at its local exchanges. The Finnish Competition Authority found that since Elisa possesses a dominant position in the market for the supply of local-loop services (over 90% in the greater Helsinki area), Elisa is obliged to offer its competitors access to its local loop. Access must be provided on non-discriminatory, transparent and reasonable terms.

Several of Elisa's ISP competitors issued complaints to the Competition Authority regarding the introduction and pricing of Elisa's new local internet call service. Under the service, only local calls to ISPs connected to Elisa's new internet network enjoyed a 20% discount off the normal local-call tariff. This discount was claimed to be arbitrary and not based on costs. Accordingly, the complainants felt that they would be forced to switch their services to Elisa's new internet network.

The Competition Authority found that the introduction of the new tariff did not have such an impact on the competitors. Instead, during the period of investigation, the competitors actually improved their position in the market.

The Competition Authority also found that the 20% discount was justified because of the cost savings to Elisa resulting from its utilization of new technology.

Nevertheless, the authority found that Elisa had abused its position as a dominant market operator by the way it hastily informed the public and its competitors of its new tariffs for local internet calls. As a result, Elisa's competitors were not able to prepare themselves for the new playing field..

More information about this case (Case 350/61/99) can be obtained from the Competition Authority's web site at http://www.kilpailuvirasto.fi/english/index.html

For further information on this topic please contact Craig Thompson at Roschier Holmberg, Attorneys Ltd by telephone (+358 8 551 3300) or by fax (+358 8 551 3320) or by e-mail ([email protected]).

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