Press release 18 March 2008
Ministry of Enterprise, Energy and Communications

Functional separation for better broadband competition

The Government has now approved the Bill "Functional separation for better broadband competition", which is intended to improve competition in the broadband market.

In the Bill, the Government proposes that the National Post and Telecom Agency (PTS) be given more scope to intervene so as to increase competition in the broadband market by ordering functional separation. Such a decision can be taken by the PTS if it turns out that the dominant operator still has an unfair advantage vis-à-vis other operators in the market, and other operators do not have sufficient insight into the dominant operator's network operations, despite other measures from the PTS.

"We have decided on a number of measures to develop the broadband market and improve competition in the existing broadband market. We are now giving the PTS another tool to increase competition. The purpose is to give consumers greater freedom of choice of broadband services and to make it easier to change broadband operator. In the long term, we consider that this will also lead to lower prices for broadband services," says Minister for Communications Åsa Torstensson.

The Government's proposal means that business units that administer, operate and supply the copper access network will be separated from other operations, particularly sales operations, so that all actors are given access on equal terms to the copper access network. This proposal can never mean that the dominant operator, today TeliaSonera AB, will be forced to transfer ownership of the copper access network to a special company. A decision on functional separation must be preceded by a thorough investigation and consultations with the market. Before a decision is taken by the PTS, the European Commission must give its approval.

To ensure that the separated business unit is independent in relation to the operator's other activities, the PTS can decide on terms that limit influence over the separated unit. It will also be possible for the PTS to order the dominant operator to ensure that it has a function that monitors compliance with its obligation.

The proposed Act will also give the dominant operator the alternative option of implementing functional separation voluntarily. A voluntary separation of this kind can be approved by the PTS in a decision.

It is proposed that the new provisions enter into force on 1 July this year.