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Comreg says Enet has fixed its pricing issues

Telecoms watchdog publishes long-awaited report into State-backed firm’s pricing

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Unambiguous: Enet's John Gilvarry says he hopes the matter is now closed.

Unambiguous: Enet's John Gilvarry says he hopes the matter is now closed.

Unambiguous: Enet's John Gilvarry says he hopes the matter is now closed.

A long-awaited report from the telecoms regulator on whether State-backed infrastructure firm Enet is adhering to non-discriminatory practices against rival telecom companies has found that Enet has improved its operational standards but has not yet fully implemented previous State-sanctioned recommendations.

The report, prepared by PwC for Comreg, means that Enet is unlikely to face any regulatory action from the telecoms watchdog.

It follows a previous State-backed investigation into Enet which found that the company had not adhered to a ‘code of practice’ on intercompany transfer pricing. That investigation, tasked to Analysys Mason, recommended that Enet should reduce its pricing levels on ‘dark fibre’ by over 50pc.

The latest Comreg report says that Enet has largely implemented the Analysys Mason recommendations, but has yet to fully complete its documentation around pricing discounts.

“The key finding of the report is unambiguous,” said John Gilvarry, Enet’s chief operating officer.

“The report states that the intercompany pricing policy did not represent any unfair advantage. As a result, we sincerely hope that this draws a line under the matter.”

Enet runs a string of 88 State-owned backbone telecoms networks located around 94 towns across Ireland. The networks, built at State and EU expense, are intended to help the towns’ capability to host broadband and connectivity services. They are ultimately used by over 70 retail service providers and over a million people.

A government-commissioned report in 2019 found that some of its pricing amounted to a risk of discriminatory practices against rivals.

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The government investigation sought to determine whether the metropolitan area networks (MANs) were being operated on a “transparent and non-discriminatory basis”, and whether Enet was “leveraging its concession-based MANs business to provide an unfair advantage” to its non-MANs business, ETNL.

Analysys Mason made 12 recommendations in its report to ensure Enet’s compliance with the Code of Practice for the MANs.

Enet has been at the centre of some controversy in recent years. A 2017 government decision to extend Enet’s contract to run the MANs until 2030 without a tender attracted criticism from telecoms providers such as BT Ireland. The contract was reportedly worth close to €20m a year and was due to run until 2024.

While Irish telecoms firms are regularly under a critical public spotlight, Enet’s State-supported status has subjected it to additional scrutiny.

Enet is ultimately owned by the State-backed Irish Infrastructure Fund (IIF), having been sold by the US businessman David McCourt in 2018.

The IIF was set up by Irish Life in 2012, and is managed by Irish Life Investment Managers and Australian investment company AMP Capital.

It invests on behalf of 28 institutional investors, 25 of which are Irish pension funds including university trusts, union pensions, religious orders, construction worker pensions and companies’ pensions.

The Ireland Strategic Investment Fund (ISIF) is one of the investors in IIF.


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