March 28, 2002, 2:24 PM — The European Union on Wednesday warned Koninklijke KPN NV that it suspects the Dutch telecommunication company of abusing its dominant position by setting unfair pricing and thereby breaking E.U. law.
Specifically, the European Commission (EC) is charging KPN with levying lower charges against its own KPN Telecom division for the termination of fixed-line to mobile telephone calls than for its competitors, the EC said in a statement Wednesday.
KPN is being accused of violating Article 82 of the EC Treaty to prohibit abuses of dominance and has granted KPN two months to respond to the allegations, after which time the Commission will "form a final position," the EC said.
KPN contends it is being unfairly singled out by the EC and asserted that its mobile call termination rates are by far the lowest in the Netherlands and in line with the European Union average, KPN said in a statement issued late Wednesday.
The EC conceded that the mobile call termination market in general is a "source of concern" in that the average charged by mobile operators in the E.U. for the termination of a mobile to fixed-line call is