France Telecom kept competitors out of the high-speed Internet market illegally by charging artificially low prices, Europe's second highest court ruled today.
In backing a 2003 European Commission decision, the Court of First Instance upheld a €10.35 million fine on the partially state-owned incumbent telecoms operator.
It said France Telecom's Wanadoo unit charged consumers rates for high-speed network access that did not cover the costs, pushing out rivals who could not compete at such prices.
This was "part of a plan to pre-empt the market . . . during a key phase in its development", the court said.
France Telecom hoped to recoup losses on the sale of the service by making considerable profits on the prices it charged Wanadoo's rivals for access to the network, the commission said in its original decision.
It said Wanadoo's predatory pricing ran from March 2001, when mass-marketing of ADSL services started, to October 2002, when France Telecom cut its wholesale prices by more than 30 per cent