French telecommunications operator Orange has been fined $380 million (Sh38.8 billion) for breaching competition rules in the corporate market, the French competition regulator said on Thursday.
The fine, the biggest the regulator has ever slapped on an individual company, comes after competitors Bouygues Telecom and SFR complained that Orange had been hindering free competition in the business market for fixed and mobile phones since the early 2000s, said the authority.
Bouygues has since dropped out of proceedings after receiving a 300 million euro payoff from Orange.
ANTI-COMPETITION PRACTICES
Orange had established a number of anti-competition practices, especially loyalty schemes, that stopped corporates from picking a different operator for even part of their telecoms needs, said the authority.
This amounted to “serious malpractice”, it said.
Orange had also restricted other operators’ access to client information it held thanks to its former monopoly position as historic fixed-line operator France Télécom, it said.
The competition authority said it had ordered Orange, which had been co-operating in the investigation, to immediately re-establish a “healthy competition situation” in its markets.
“We must ensure that companies are not held captive by a single operator for too long,” a spokesperson for the authority told AFP.
“Our legislation has done a lot for individuals in this respect, but very little for companies who are finding it more difficult to switch from one operator to another.”
FINE
Orange took the fine, which represents less than one percent of its annual sales of 39 billion euros in 2014, in its stride.
“Orange long ago set aside a provision which is more than big enough to cover this fine, and therefore it will have no impact on our results for the year or on our financial targets,” Orange chairman Stephane Richard told AFP.
The competition authority said the fine had been negotiated with Orange, which had signalled its acceptance of a payment not exceeding 350 million euros without appealing the decision.
Orange’s share price was also unaffected by the fine, rising 3.3 per cent on the Paris stock exchange, which was lifted across the board by a Federal Reserve rate increase on Wednesday.
