NMa's follow-up inspection: KPN honors its commitments

Having carried out a follow-up inspection, the Netherlands Competition Authority (NMa) did not find any indications that Dutch telecom company KPN is using the phone call records of its competitors' customers in any way that might violate the Dutch Competition Act. It has however made several recommendations to further optimize the functional and operational separation of phone call records. KPN has honored its earlier made commitments that involved improving the so-called 'Chinese walls' between its various divisions.

KPN's main activities include management of the fixed copper-line network and offering telecom services through that network. KPN's competitors often offer land-line services to their customers using KPN's network. And as a consequence, KPN has access to those customers' phone call records, which includes information such as phone call length. KPN's divisions offering telecom services are not allowed to have access to these records, which could be used for their own marketing purposes. That would be an unfair competitive advantage – the result of its owning the network.


In 2005, the NMa carried out an inspection of the separation that KPN applies – a so-called Chinese wall – between its network management (Wholesale) and its sales (Retail) divisions. The inspection led to a number of recommendations to KPN as well as commitments by KPN for improving the Chinese wall. The NMa carried out a follow-up inspection in late 2008 and has established that KPN has honored its commitments made in 2005. It has tightened its internal procedures relating to accessing the phone call records, and it has increased efforts to inform its employees about the separation of these records.


The NMa's recommendations to KPN that have resulted from the most recent follow-up inspection are:
• Protecting data storage devices against phone call records copying;
• Checking impending projects that involve employees from both Wholesale and Retail. The NMa recommends to have the compliance department carry out the checks;
• There needs to be a more in-depth check next to the existing procedural check against exchanging phone call records between Wholesale and Retail.


The NMa has conducted its 2008 follow-up inspection in close cooperation with the Independent Regulator of Post and Electronic Communications in the Netherlands (OPTA). Follow-up inspections are frequently carried out to check whether the undertakings in question honor the commitments they made to the NMa to safeguard competition.