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KPN fined for putting large business customers at a disadvantage

The Netherlands Authority for Consumers and Markets (ACM) has imposed a fine of EUR 900,000 on Dutch telecom provider KPN. In 2009, ACM found out that KPN had misled ACM when it provided tariff information in connection with the 2006 tender process of fixed-telephony services for various government organizations.

It turned out that the level of the tariffs that KPN offered the government organizations in said tender process would be fixed for the entire duration of the contract. Other large business customers, too, should have been informed by KPN about such offers with fixed tariffs. As KPN failed to do so, other large business customers were unable to benefit from such fixed tariffs. KPN thus violated the transparency obligation. The only tariff option the large business customers had were tariffs that KPN annually adjusted for inflation. In 2006, it was prohibited for KPN to make such selective offers to large business customers, as it negatively affected competition on the telecommunications market. KPN thus also violated the non-discrimination obligation.

The original fine that KPN was imposed in late-2011 for these violations was EUR 1,440,000. This fine had not been published before because KPN went to court to challenge its publication. On March 20, 2014, the District Court of Rotterdam lowered the fine to EUR 900,000. The court ruled that it had not been proven that KPN failed to meet a third obligation, which was the notification requirement. According to the court, KPN did inform ACM of the offer in the tender process. With the court’s ruling, the remaining two violations that have led to large business customers being put at a disadvantage have now been confirmed.

KPN and ACM have not filed an appeal against the court’s ruling.

More information about the District Court of Rotterdam’s ruling: