BT told it must lower access fees charged to rivals

Communications giant BT has been told that it must lower the access fees that it charges to rival phone and broadband providers by an appeals court.

An appeals court has recently ruled that the communications giant BT must lower the access fees that it charges to rival broadband and phone providers. The court ruled that BT needs to lower its access fees because of errors by the UK’s communications regulator Ofcom.

According to the courts the UK’s communications regulator set price caps for this access in May of 2009, but the price caps that it put into place are said to have been too high. The Competition Appeal Tribunal said that the regulator made errors in calculating inflation and efficiency when it set the price caps.

The panel that made the ruling was made up of three judges, and they said that Ofcom needs to adopt new price controls as soon as possible. The judges also said after making the ruling: “Once the price controls are adopted, BT will be bound to comply with their terms.”

The ruling was made following some claims in the appeal made by rival providers Talk Talk and Sky, which were supported by the country’s antitrust regulator, the Competition Commission. BT has already stated last year that the price cap is already too low, and makes it difficult to recover costs.

It is thought that the price cap changes will result in adjustments of around four million pounds in total. BT officials said that any adjustments that are made to price controls should only be small because the Ofcom errors were much smaller than those argued in court by rival providers.

Source – Bloomberg