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ComReg asks court to intervene in investigation into Eircom transparency compliance

Telecommunications regulator deems Eircom to have a dominant position in the wholesale market

The judge entered a case into the High Court’s fast-track commercial division. File photograph: iStock

Wed Oct 4 2023 - 17:45

Telecommunications regulator ComReg has asked the High Court to intervene in its investigation into whether Eircom has complied with its obligations of non-discrimination, transparency and price control in the wholesale broadband access market.

Eircom Ltd (which trades as Eir) has been found by ComReg to have a dominant position in the wholesale market whereby it sells access to competing operators. In 2022, some €119 million of Eircom’s €238 million revenue was derived from its supply of next-generation access broadband rental and usage to other operators, ComReg says.

On Wednesday, Mr Justice Denis McDonald entered a case into the High Court’s fast-track commercial division related to an investigation ComReg is carrying out into Eircom as a wholesale seller of telecommunications services to other providers. Eircom consented to the entry.

ComReg says it has found that Eircom has “significant market power” in the wholesale market.

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The regulator says it has imposed a number of regulatory obligations on the company so as to promote competition and protect other operators and ultimately the consumer from the “negative effects” of Eircom’s position of strength in the market.

In an affidavit seeking entry of the matter to the Commercial Court, Michael Patterson, ComReg’s head of wholesale compliance and governance and its lead investigator in this case, said that fundamental to the regulatory regime is the principle that non-compliant conduct, specifically in the wholesale market, affects the ability of competitors to compete over time.

Last February, Eircom notified ComReg of a proposed discount scheme for certain products that are important for delivering telecommunications services, including broadband, in the State. These products included its fibre-to-home offering.

ComReg told Eircom the discount scheme did not meet regulatory requirements and there were significant concerns regarding the impact the scheme would have on investment and competition, Mr Patterson said.

ComReg said the scheme should not be put into effect and Eircom subsequently confirmed it would not publish the discount scheme.

However, Mr Patterson said, due to the “unusual circumstances surrounding Eircom’s treatment of the scheme, ComReg had concerns as to whether Eircom was acting/had acted contrary to regulatory obligations imposed on it”.

An investigation commenced and ComReg officers attended Eircom’s headquarters in late May and early June last when they seized information and documentation data which ComReg says may be potentially relevant to the investigation.

A protocol was proposed by ComReg for removing irrelevant and potentially privileged legal material from the seized data but there was no agreement with Eircom on this.

Mr Patterson said that as a consequence of this he was unable to unseal the seized data and has been unable to substantively progress the investigation.

As a result, ComReg brought an application under communications regulation legislation seeking orders and declarations from the court allowing it to adopt and follow the proposed protocol for removing irrelevant/privileged material.

Applying for entry of the case to the Commercial Court, Eoin McCullough SC, for ComReg, said that before the substantive case is dealt with Eircom wanted to agitate the issue of whether it should be heard otherwise than in public (in camera).

Brian Kennelly SC, for Eircom, said there was a large amount of very sensitive material at issue in the case and his side was still trying to avoid a situation of having to make an “in camera” application.

Counsel proposed that rather than the court assigning a date for the in-camera application hearing, the matter could be put back and by October 10th his client can notify the court if it will be necessary.

The judge put the matter back to October 16th and gave directions for exchange of papers between the sides if an in-camera hearing was necessary.

He also said he was not keen on fixing a date for the substantive hearing at this stage as the court has the power to appoint an appropriate person to review documents.

The judge said he would first really need to know where each side was coming from, particularly in relation to the power to impose directions on the protocol to be applied (in relation to the irrelevant/privileged data).

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