3UK calls for EU to block m-commerce JV as anti-competitive

3UK will formally call upon the European Commission (EC) to block the mobile commerce joint venture formed by its UK rivals, Vodafone, O2 UK and Everything Everywhere.

The company, which has been excluded from joining the founders, is planning to file a submission to the EC claiming the m-commerce venture is anti-competitive and therefore should not be given the go-ahead when the JV submits its proposal for approval. The company filed initial complaints in September.

3UK's regulatory director, Stephen Lerner, told the Daily Telegraph that the proposed "one-stop-shop" for m-payments and mobile marketing may be "dressed as a collaborative effort" but its endeavour is to restrict open competition.

"Its real aim is to eliminate the prospect of competition. This is anti-competitive and akin to a joint selling arrangement," Lerner said. "By controlling and selling access to over 90 per cent of UK mobile subscribers [they] seek to foreclose the market to third parties and do away with the inconvenience of competing with each other."

3UK is understood to have scheduled a meeting with EC regulatory authorities to discuss its objections later this month.

The m-commerce JV, operating under the temporary name of Project Oscar, has yet to overcome regulatory barriers, albeit that the three operators jointly announced the JV in June of this year. It remains unclear how EC authorities will view the formation of three dominant operators setting the technical standards and then acting as the single sales agent to advertisers and banks that wanted to launch new products.

However, a source told FireceWireless:Europe that the aim of the JV is to compete with established players that are about to launch or have either already launched similar services. A spokeswoman for the three operators added: "In our submissions to the EC we will be detailing the reasons why the JV will strengthen competition and benefit consumers."

Marjorie Holmes, competition partner at law firm Reed Smith, told Mobile Today, "At the moment, neither the EC nor the Office of Trading have been notified of the JV seeking merger clearance, but if they are, the competition authorities will need to carefully consider whether it will be truly independent from Vodafone, O2 and Everything Everywhere."

"'The competition authorities will look at whether, Vodafone, O2 and Everything Everywhere, will have representatives on the board, whether those representatives will have access to any confidential information or will exercise any control," she added.

For more:
- see this Dow Jones Newswires article
- see this Daily Telegraph article
- see this Mobile Today article

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