Competition Commission fines Swisscom CHF 7.9 million for margin squeeze

20. November 2015

Following a complaint by Sunrise in 2009, the Swiss Competition Commission investigated whether the pricing of Swisscom, the incumbent Swiss telecommunications company, in connection with a Swiss Post tender resulted in a so-called margin squeeze. Swiss Post had called for tenders in 2008 to set up a broadband network between its locations. Next to Swisscom, two other competitors (Sunrise, upc cablecom) submitted tenders. Sunrise's tender depended largely on its access to Swisscom's essential copper and fiber network. The Commission found that the margin between Swisscom’s upstream price for its essential input and its downstream price offered to Swiss Post made it impossible for Sunrise to effectively compete. Furthermore, the Commission found that Swisscom's pricing resulted in excessive downstream prices. In its decision of 21 September 2015 (publicly announced on 19 November 2015), the Commission concluded that Swisscom abused a dominant position and thereby violated the Swiss Cartel Act. Swisscom announced to appeal against the Commission's decision before the Federal Administrative Tribunal.

Froriep filed Sunrise's complaint in 2009 with the Competition Commission. The Froriep team was led by partner Boris Wenger.