Telecom Italia (TI) on Monday appealed the recent decision of the National Commission for the Defense of Competition (NCDC), the Argentine antitrust enforcer, to block voting rights held by TI in Telecom Argentina (TA), charging that the ruling amounts to an illegal “confiscation” of TI’s stake in TA, Argentina’s second-largest fixed line carrier. TI holds a 50% stake in Sofora, S.A., the holding company in control of TA, while a local Argentine investment firm, the Werthein Group (also known as Grupo W), owns a 48% stake. The NCDC ruling is connected to an earlier investigation into Telefonica of Spain—an indirect TI shareholder and owner of principal TA rival Telefonica Argentina—and whether Telefonica’s indirect minority stake in TI contradicts Argentine antimonopoly laws. Notwithstanding TI’s assertion that Telefonica’s indirect 10% interest in TI equates to a mere 1.8% stake in TA, an Argentine congressional committee determined in November that Telefonica’s holding violated the law. Accordingly, the NCDC issued an order earlier this month that requires TI directors on the TA board to abstain from taking part in decisions that concern the management of TA, retroactive to January 9. Significantly, TI holds a call option, vested on that date, that allows it to purchase from Grupo W the Sofora stake that Grupo W acquired from France Telecom in 2003. Claiming that Grupo W hopes to prevent the exercise of that option, lawyers for TI argued that the NCDC’s action “only benefits the Grupo W, in practice conferring to them exclusive control over” TA. As such, TI asserted in its appeal that “with an illegitimate decision [by the NCDC], the running of [TA] has been left to a shareholder that shouldn’t be a shareholder any longer, having agreed to irrevocably and unconditionally leave the company at the beginning of 2009.”