At the end of last year, we could already see that Telefónica could face a sanction by the National Commission for Markets and Competition in Spain. And, finally, it has been confirmed that the Spanish operator will have to pay a fine of up to 6 million euros for breaching the commitments accepted in its merger with DTS.
Previously, the blue operator had managed to win the dispute against the CNMC. More than anything, because he had also been sanctioned with a fine of 6 million euros for allegedly discriminating against his competitors in the breakdowns. Now, this sanction with the same economic amount is due to the conditions of Movistar Fusión.
The sanction to Telefónica
To understand what has led to this sanction for the Spanish operator, we have to go back to 2015. The year in which Telefónica decided to present a series of commitments that it was going to fulfill voluntarily to acquire DTS and thus get the competition to the market continued. For example, it was established that conditions of permanence would not be imposed on its Movistar Fusión rates.
However, as has been found out over the years, the National Commission for Markets and Competition (CNMC) has definitively sanctioned Telefónica with 6 million euros for breaching the commitments acquired after the acquisition of dts.
These commitments, with an initial validity until April 2020, were extended by the CNMC in July 2020 for an additional period of three years. Just a few days ago, for example, the National Court, in its ruling of February 8, 2023, validated the CNMC’s decision to extend these commitments. But, the sanction is clear, since the purchase of DTS by the blue operator was “conditional on compliance with the commitments” that Telefónica had proposed.
The permanence in Movistar Fusion
One of the first breaches that we find on the part of Telefónica is in permanence. Basically, within section 1.1 of the commitment that he proposed at the time, and which the CNMC approved, it was established that conditions or practices could not be applied to his pay TV customers so that they would not “hinder mobility”, that is, , some kind of permanence.
However, the National Markets and Competition Commission considers that within the commercial conditions of its Movistar Fusión rates, with the fact of renting a smartphone (which was in force from April 11, 2021 to August 1, that same year), that commitment 1.1 was violated, since they consider that it is a permanence measure that is indirectly linked to pay television of the Fusion rate.
Therefore, from the CNMC they make it clear that this type of permanence has limited the mobility of customers to go to other competing operators of Telefónica. And it is for this very reason that the Spanish operator has been sanctioned with a fine of 6 million euros. Although, the operator can file a contentious-administrative appeal before the National Court within a period of two months from the day following the notification of this sanction.
