Oftel reviews BT’S price notification obligations

Ref: 44/01

28 June 2001

Currently, all telecoms operators must publish details of charges for their services to residential customers.

Because BT has significant power in particular markets, BT has to give 28 days’ notice to Oftel and to the public if it intends to change the price of a business or residential service.

In accordance with its strategy of ensuring appropriate regulation, Oftel is now reviewing this obligation, and is seeking comments on whether advance notification helps customers.

BT and other operators will still be required to make prices available to consumers, whatever the outcome of the consultation.

David Edmonds, Director General of Telecommunications, said:

"I am reviewing these rules, because it is possible that they make it easier for companies to change their prices in response to other companies’ price changes, instead of competing more vigorously. This may mean that prices for consumers are kept artificially high. Removing the obligation could lead to increased competition on price.

"BT currently has to give 28 days notice if it intends to change the price of a service. This rule was introduced to give competitors the opportunity to examine their own pricing. The 28 day period also lets the regulator consider the proposal and, if necessary, investigate whether it is anti-competitive.

"Oftel is keen to gain the views of consumer groups and industry before reaching decisions.

"BT and other operators will still be required to make prices available to consumers, whatever the outcome of the consultation."

The advance notification obligation is one of a range of BT’s licence obligations which Oftel is currently reviewing to ensure that regulation remains appropriate to today’s market.

A decision on advance notification on price changes will not apply to BT’s obligations with regard to network charges or local loop unbundling services.

"Oftel will look at this possibility and decide whether changes need to be made."

Notes to editors

1 Oftel's consultation document BT’s regulatory obligations to provide advance notification of price changes and to maintain a published price list is available from Oftel's website at www.oftel.gov.uk/publications/licensing/adva0601.htm. Hard copies are available to the media from Oftel's press office on 020 7634 8991 and to the public from the Research and Intelligence Unit on 020 7634 8761.