The European Commission has sent a statement of objections to Telefonica and Portugal Telecom (PT) regarding their agreement not to compete on the Iberian telecommunications markets. The EC believes this agreement hinders competition in breach of EU antitrust rules that prohibit restrictive business practices. Back in January this year, the EC launched an investigation into the agreement concluded in July 2010 whereby Telefonica and PT agreed not to compete with each other in the Iberian market. The agreement was concluded as part of Telefonica's 2010 acquisition of sole control over the Brazilian mobile operator Vivo, previously jointly owned by both parties. The EC says the object of the agreement was to partition markets, resulting in potentially higher prices and less choice for consumers. The two operators repealed the non-compete agreement in February, after the EC started antitrust proceedings. The companies now have two months to reply, as well as request an oral hearing amongst other procedural rights.
