BT has withdrawn from talks with Eircom over broadband access to its network and will consider taking legal action here or in Europe. It will also consider approaching the European regulator. The telecom group believes the Irish regulator, Comreg, does not have the powers necessary to deal with the issue.

The negotiations concern processes to allow Eircom's competitors to offer broadband services over Eircom infrastructure. "Eircom continues to frustrate the process and we do not see positive indications that a future change of ownership at the monopoly provider will bring a more progressive approach," said BT chief executive Danny McLaughlin.

Eircom's commercial director David McRedmond said he was very surprised by BT's decision "to derail the process". "We urge Comreg to get everyone back into the room."

Comreg, in a statement, said it had facilitated discussions with a view towards certain objectives but the talks had now broken down. Comreg would proceed by way of enforcement, it said.

Alto, representing new entrant operators, said Eircom was abusing its dominant market position.