This case stems from a complaint that the company TSC submitted to the Competition Authority. TSC is a small telecommunications company operating in the northern part of the Snaefellsnes Peninsula. TSC argued that Síminn had imposed unlawful commercial barriers on the company and prevented competition, inter alia by restricting access to Síminn's transmission network for the distribution of television content from the Icelandic Broadcasting Corporation (Skjár 1). Following an investigation into the matter, the Competition Authority found that Síminn had breached two conditions set out in a decision by the competition board No. 10/2005, the merger of Landssími Íslands hf. and Íslenska sjónvarpsfélagsins hf., and imposed a fine on the company last December. Síminn appealed the Competition Authority's decision to the Competition Appeals Board, which published its ruling today. The panel confirmed the Competition Authority's finding that serious breaches had been committed and that it was right to impose a fine on Síminn.
The aforementioned 2005 decision by the competition council concluded that the merger of Síminn and the Icelandic Broadcasting Corporation would distort competition and that action was required, inter alia, to secure the competitive position of smaller telecommunications companies. Síminn agreed to comply with certain conditions in order to eliminate the restrictions on competition that would otherwise have resulted from the merger. As previously stated, the Competition Authority found in its decision that Síminn had breached some of these conditions. The appeal board's ruling confirms this, and the board considers these breaches to be serious, stating that the conduct of Síminn is “in opposition to some of the core principles that it itself undertook to honour when the merger with ÍS [Íslenska sjónvarpsfélagið] was approved.“ The Appeals Board also finds that the conduct of Síminn was to the detriment of consumers.
The Competition Authority considered it appropriate to impose a fine of kr. 150,000,000 on Síminn. In this regard, the Authority took into account, among other things, Síminn's previous breaches of competition law. The appeal board reduced this fine to kr. 50,000,000. In support of this, the appeal board referred to the worsening financial performance of Síminn and that potential technical shortcomings had been a contributing factor in part of the infringement. The Appeals Board also annulled an order that the Competition Authority had directed to Síminn to remedy the competitive position of smaller competitors, as the Board considered that the order did not fall within the authority on which it was based.
See the decision of the Competition Appeals Board for further details. No. 2/2010.
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