August 9, 2026

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August 9, 2026

Newsletter

The European Post

Policy • Diplomacy • Strategic Insight

LATEST
New EU Gas Market Rules Take Effect With Consumer SafeguardsDeforestation Regulation Holds Its December Deadline Despite CutsDigital Omnibus Delays Europe’s High-Risk AI Deadline to 2027Europe’s Schools Confront a Widening Basic Skills GapRule of Law Report Finds Progress but Trust Still LagsIRIS2 Gains 66 Satellites as Brussels Signs the Rollout DealNature Restoration Plans Come Due as Member States Race a DeadlineECB Rates Hold at 2.25 Percent as Frankfurt Waits on the DataEU Budget Talks Turn to Cohesion as Ireland Takes OverWildfire Response Stretches Europe’s Emergency Fleet ThinCan Europe’s Quantum Plan Match Its Big Ambitions?Armenia Edges West as Moscow’s Grip Slips AwayEurope Inherits the World’s Aid Bill It Cannot Fully PayAir Passenger Rights Get Their First Overhaul in Two DecadesErasmus Opens a 5 Billion Euro Round for Skills and MobilityCeuta Crisis Pushes the EU Toward Faster Migrant ReturnsBulky Parcels Face a Packaging Crackdown From August 12Can Europe Build Its Drone Wall Before 2030 Arrives?Indonesia’s Trade Deal With Europe Nears Its Final SignatureEurope Leans on Beijing to Keep Climate Talks Alive Before AntalyaNew EU Gas Market Rules Take Effect With Consumer SafeguardsDeforestation Regulation Holds Its December Deadline Despite CutsDigital Omnibus Delays Europe’s High-Risk AI Deadline to 2027Europe’s Schools Confront a Widening Basic Skills GapRule of Law Report Finds Progress but Trust Still LagsIRIS2 Gains 66 Satellites as Brussels Signs the Rollout DealNature Restoration Plans Come Due as Member States Race a DeadlineECB Rates Hold at 2.25 Percent as Frankfurt Waits on the DataEU Budget Talks Turn to Cohesion as Ireland Takes OverWildfire Response Stretches Europe’s Emergency Fleet ThinCan Europe’s Quantum Plan Match Its Big Ambitions?Armenia Edges West as Moscow’s Grip Slips AwayEurope Inherits the World’s Aid Bill It Cannot Fully PayAir Passenger Rights Get Their First Overhaul in Two DecadesErasmus Opens a 5 Billion Euro Round for Skills and MobilityCeuta Crisis Pushes the EU Toward Faster Migrant ReturnsBulky Parcels Face a Packaging Crackdown From August 12Can Europe Build Its Drone Wall Before 2030 Arrives?Indonesia’s Trade Deal With Europe Nears Its Final SignatureEurope Leans on Beijing to Keep Climate Talks Alive Before Antalya

Telefónica And Pharol Face A Revived Cross-Border Antitrust Fine

Christian Torp
Directive Tracker, Social Affairs and Employment

Faro: A competition case that has shuttled between the Commission and the Union’s courts for well over a decade has come back to life. In late May the Commission re-adopted its decision against the Spanish operator Telefónica and the Portuguese group Pharol, the former Portugal Telecom, imposing fines of just under 67 million euros on the former and a little over 12 million on the latter. The penalty punishes a clause by which the two companies agreed not to compete with one another on each other’s home telecommunications markets.

The conduct dates to a corporate deal struck in 2010, when Telefónica acquired full control of a Brazilian mobile venture the two had jointly owned. Tucked into that agreement was a non-compete provision under which each promised to stay out of the Iberian market of the other, Telefónica refraining from challenging Portugal Telecom in Portugal and the Portuguese group keeping clear of Spain. To the Commission, two former partners carving up neighbouring national markets between them was a textbook restriction of competition, depriving customers on both sides of the border of a potential new entrant.

The original decision came in 2013, but its road since has been tortuous. When the companies challenged it, the Union’s General Court in 2016 upheld the substance of the Commission’s findings, agreeing that the non-compete clause breached the rules, yet annulled the fines themselves on the ground that the Commission had not adequately established the range of services to which the restriction applied. That left the unusual situation of confirmed wrongdoing without a valid penalty. The fresh decision is the Commission’s effort to repair that defect and reimpose sanctions on a sounder evidential footing.

The re-adoption matters beyond the two firms. It signals that the Commission will not let procedural setbacks erase enforcement, and that a clause buried in the fine print of a wider commercial transaction is no shield against scrutiny. Non-compete arrangements between actual or potential rivals are among the oldest concerns of competition law, and the case is a reminder that they attract the same hostility whether they stand alone or ride along with a legitimate acquisition. Companies negotiating cross-border deals will read the outcome as a warning to keep their lawyers close when drafting ancillary restraints.

For the telecoms sector specifically, the decision lands at a moment when the Union is wrestling with how much consolidation to tolerate. Operators argue that fragmentation across national markets leaves them too small to invest in next-generation networks and have pressed regulators to look more kindly on mergers. The Commission’s willingness to reach back across thirteen years to fine an old market-sharing pact suggests that any new appetite for consolidation will not extend to arrangements that simply divide territory and dull rivalry.

Both companies can be expected to consider a further appeal, sending the matter back toward the courts that have already reshaped it once. Whatever the ultimate figure, the episode shows the long memory of European competition enforcement, and its readiness to keep a case alive until the penalty finally sticks.

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