Germany slams brakes on local loop competition

The German upper house of parliament, the Bundesrat, decided Friday not to approve an amendment to the national telecommunication bill that would have created greater competition in local telephone networks, a spokeswoman for the Bundesrat said.

The decision means it is very likely the European Commission will take the German Government to the European Court of Justice for failing to abide by a European Union directive designed to liberalize the telecommunication market.

The bill, which was approved earlier in the year by the lower house of parliament, the Bundestag, aims at breaking former monopoly telephone company Deutsche Telekom AG’s near 95 per cent grip on the so-called local loop by allowing call-by-call and preselection services. These services allow other companies to provide telephone and dial-up Internet service over infrastructure leased from Deutsche Telekom (DT).

The Bundesrat is made up of the heads of the German states, called L