Politicians move on TPSA split
By : Roseanne Gerin and Robert Wylot
A new amendment to the Telecommunications Law introduced last Tuesday to divide the operations of dominant operator Telekomunikacja Polska (TPSA) (http://www.tpsa.pl) may pick up support after the September elections, although the initiative would likely face further obstacles.
Twenty-nine Sejm MPs filed the amendment to accelerate the ongoing liberalization of the telecom market. The proposal says telecom operators would not be able to dominate in more than one zone divided according to the country's old 49 voivodships from Jan. 1, 2002 to the end of 2011. MPs from the Solidarity Election Action (AWS), Democratic Left Alliance (SLD) and Freedom Union (UW) parties introduced the amendment to break TPSA's continued monopoly by dividing its operations into separate sections for local, domestic long-distance, international long-distance and mobile telephony.
TPSA dominates about 95% of the market in fixed-line telephony, still controls all but a small number of domestic long-distance calls and fully controls the international long-distance calling market.
With the opposition SLD likely to carry the Sept. 23 parliamentary elections, the amendment could be passed after new MPs take their seats in the Sejm. SLD MP Wieslaw Kaczmarek, one of the signatories of the amendment, said he wants to see the SLD pass the amendment if it wins the elections. "It's a parasite company," said Kaczmarek, referring to TPSA.
Piotr Gawron, TPSA's spokesman, did not return phone calls.
But even if Parliament passed the amendment, the Telecommunications Regulation Office (URT), the industry's independent regulator, would first have to declare TPSA the dominant operator on the telecoms market in more than one zone before the breakup could occur. Press reports last week said that a decision by the URT could be delayed by TPSA's recent appeal to the anti-monopoly court against its classification as a dominant entity by the Office for Competition and Consumer Protection (UOKiK).
In addition, TPSA's strategic investors, France Telecom (http://www.francetelecom.com) and domestic firm Kulczyk Holding (http://www.kulczykholding.pl), could block the proposed breakup if they consider the amendment a violation of their privatization agreement, the terms of which have not been publicly disclosed. In this case, the French would likely file a lawsuit, according to local reports. The two firms purchased a 35% stake in TPSA last July and are negotiating with the Treasury Ministry for a further 10%.
"We first have to see what the Treasury Ministry promised to the investor to see what kind of commitment the treasury has toward France Telecom," said Kaczmarek, who is believed to be the top candidate for the position of treasury minister if the SLD wins the elections. "The agreement is confidential."
A France Telecom press officer said he had not read the proposed amendment and could not comment on it.
