Monday 21 January 2019

Eir to pay €3m court penalty to settle complaints of bias

Country's largest telecoms firm agrees deal and imposition of new watchdog to settle ComReg case

Strategy: Eir CEO Carolan Lennon welcomed the move and said Eir could now focus on its plans for the future
Strategy: Eir CEO Carolan Lennon welcomed the move and said Eir could now focus on its plans for the future
Adrian Weckler

Adrian Weckler

Eir has agreed to pay €3m to settle a High Court case brought by Ireland's telecoms regulator, ComReg. The case addresses years of complaints from rival operators about a lack of proper controls between the company's various divisions.

Ireland's largest telecoms operator has also agreed to place €9m in a special escrow account that ComReg can access if Eirbreaks telecoms rules in future.

And the firm will be subject to a new independent oversight body, the majority of whose members will be picked by ComReg.

The settlement relates to accusations that Eir has repeatedly favoured its own retail divisions when it comes to issues like fixing faulty lines and getting new customers.

The company, which owns most of the country's physical landlines, is divided into two divisions. One ('Open Eir') controls the wholesale network that lays, maintains and fixes infrastructure like lines and poles. The other side of the company, the retail division, sells services to customers.

Under Irish law, Eir is supposed to give competing retailers the same level of access and service as is afforded its own retail division.

However, a number of reports from ComReg found that Eir has favoured its own retail division in different ways, from prioritising repairs to maintaining IT systems that operate against rival companies' interests.

"As part of the agreement ComReg and Eircom have agreed a set of commitments which, when implemented, will result in the establishment and operation of an enhanced regulatory governance model in Eircom," said a ComReg statement.

"A number of the key RGM undertakings will be underpinned by a cash amount of €9m placed in escrow which can be drawn down by ComReg in the event of a late or non-delivery of the performance milestones by Eircom."

Eir has also agreed to "measures to remediate Eircom's IT systems and associated controls to ensure that access to IT systems is appropriately governed".

ComReg commissioner Jeremy Godfrey said that the case highlights the need for ComReg to have greater powers.

"To be an effective regulator, ComReg needs enforcement powers that are a clear deterrent to non-compliance," he said. "We continue to seek enhanced powers, including a power for us to impose substantial financial penalties where appropriate. Ultimately, this is a matter for the Government and the Oireachtas. We are currently working on this issue with the Department of Communications, Climate Action and Environment, who are committed to ensuring that we have the best, most appropriate and most effective powers available."

The High Court settlement marks the end of a hectic year for Eir, which was formally transferred into the ownership and control of French billionaire, Xavier Niel.

"We welcome today's agreement and the settling of our outstanding legal issues with ComReg," said Eir CEO Carolan Lennon.

"This will allow us to concentrate on our key strategic plans, most importantly our ongoing investment of €1bn in our networks. While we have significantly enhanced our regulatory governance in recent years, with many of today's provisions already in place, we appreciate the importance of transparency."

Irish Independent

Also in Business