On 20 September 2012, the French Competition Authority issued its decision regarding the dispute between France Telecom and the US telecommunications operator Cogent. Cogent, a transit operator, claimed that France Telecom’s intention to charge a fee for opening additional interconnection capacity above a maximum traffic ratio, would “compromise the peering system”.

The Authority considered that such demand would not constitute an anti-competitive practice, in light of the “highly asymmetric nature of the traffic exchanged”. To charge a fee where a significant imbalance exists between the incoming and outgoing flows exchanged between two networks is a common practice in the French market.

Nevertheless, the Authority highlighted that the current lack of transparency between Orange (IPS) and Orange Transit within the group “France Telecom” could favour margin squeeze or discriminatory practices. France Telecom were therefore required to make commitments designed to prevent or, where applicable, detect any such practices.

The formal internal protocol including financial provisions adopted in response to the concerns raised by the Authority, will be submitted to the Authority within three months. Its implementation shall be monitored for two years.

For more information please go to:

http://www.autoritedelaconcurrence.fr/user/standard.php?id_rub=418&id_article=1971