Thursday, October 6

The Supreme Court confirms the cancellation of a fine of 8.5 million to Telefónica

The Supreme Court has confirmed the annulment of the 8.5 million euro fine that the National Markets and Competition Commission (CNMC) imposed on Telefónica in the spring of 2018 for an alleged serious violation of the General Telecommunications Law.

In his sentence, known this Thursday, the room of the Contentious-Administrative The high court rejects the appeal of the body and endorses the verdict of the National Court, which last year already gave the reason to the Spanish multinational on these facts.

The case dates back to 2015, when Telefónica entered a tender organized by the Basque government. Later, in January of the following year, the company won part of the contract for the provision of telecommunications services for various buildings of the regional administration.

Before the award, the Basque operator Euskaltel reported to the CNMC that the economic offer presented by Telefónica was not replicable by a hypothetical business operator, mainly attending to the regulated conditions of the wholesale services contracted to it.

After analyzing the data, Competition concluded that the offer from the multinational for part of this contest was “irreplicable“by an efficient and generalist operator with its own network deployed such as Euskaltel, which in practice implied that this operator would obtain negative profitability by providing the services included.

Therefore, it sanctioned with 8.5 million euros to Telefónica for failing to comply with the regulatory obligations it has established as an operator with significant market power.

When the fine arrived before the Justice, the CNMC argued that Telefónica “could not question data and criteria that had already been set in a previous administrative resolution “that had been declared firm.

The version of the Supreme

Now the Supreme asks if all the elements taken into account during the realization of the replicability test, which detected the sanctioned conduct and led to the initiation of the file.

First of all, the magistrates recall that “in any moment” It was proposed that the contentious-administrative appeal be not admitted, “since no one questioned” that the company could challenge the sanction.

A story in which they coincide with the National High Court, which had previously rejected the body’s approach, considering that the court could examine “the irreplicable nature of the offer and the criteria” considered when evaluating it.

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In this sense, the Supreme Court concludes that the fact that a resolution is firm in the Administrative route it does not make it “res judicata”, that is, it does not prevent a judge from studying its content in depth.

However, the sentence has the private vote of two of the six magistrates that make up the third section of the court, in favor of upholding the appeal of the CNMC and sanctioning Telefónica.

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