Rafael Aguilera Álvarez Eduardo Gómez de la Cruz Almudena Arpón de Mendívil September 10 2003 Industry Update Gomez-Acebo & Pombo Abogados | Tech, Data, Telecoms & Media - Spain Rafael Aguilera Álvarez, Eduardo Gómez de la Cruz, Almudena Arpón de Mendívil Tech, Data, Telecoms & Media Cost Account System Rejected Preliminary Measures Taken against Telefónica Cost Account System Rejected The Telecommunications Market Commission has rejected the modification of the cost account system proposed by Telefónica for 2001.The cost account system is the reference used to fix the price of regulated tariffs and the cost for provision of the universal service. The cost of the universal service is the annual cost that Telefónica must assume for its obligations to provide non-profitable services, such as the obligation to provide telephone services across the whole national territory (including those areas that are not profitable), and the obligation to provide additional services to users with disabilities. The cost of the competitive disadvantage that Telefónica must bear is also included in the cost account system.In its decision the commission stated that Telefónica does not need to be reimbursed by its competitors for the €181.95 million it incurred in providing universal services in 2001. This is due to the fact that this amount does not represent a competitive disadvantage for Telefónica, which is still the dominant market player.However, the commission has given a positive sign to Telefónica by indicating that the company could be compensated for costs incurred in 2002, a year in which Telefónica experienced a reduction in its fixed telephony market share due to the growth of mobile telephony. Preliminary Measures Taken against Telefónica Prompted by QDQ Europe SA and Conduit Europe SA, the commission has decided to take preliminary measures against Telefónica, requiring it to give Conduit Europe free online access to up-to-date and complete information about subscribers to its basic telephone services. This information must be as complete as that which is now used by Telefónica for its provision of telephone information services under the number '11818'. According to both QDQ and Conduit, Telefónica continuously rejected their requests for information contained in its database regarding the profession of its subscribers. However, this information was being provided to Telefónica's subsidiary in the telephone guide and telephone information markets. Conduit and and QDA claimed that Telefonica's conduct aimed to close the market to its subsidiary's competitors. For further information on this topic please contact Almudena Arpón de Mendívil, Eduardo Gómez de la Cruz or Rafael Aguilera at Gómez-Acebo & Pombo by telephone (+34 91 582 9100) or by fax (+34 91 582 9186) or by email ([email protected] or [email protected] or [email protected]).