OFT seeks review of Orange T-Mobile merger

The proposed Orange T-Mobile merger could be referred to the Competition Commission

The Office of Fair Trading (OFT) has asked the European Commission (EC) to refer the UK aspects of the proposed merger between Orange and T-Mobile to its authority.

The consumer watchdog confirmed in a statement today that, following a consultation on 14 January, it believes that the joint venture could significantly threaten mobile competition by creating the largest mobile operator in the UK.

If the EC grants the request, the OFT has said that it will examine the proposed merger with a view to deciding whether it should be referred to the Competition Commission for an in-depth investigation.

A spokesperson for Orange was quick to defend the deal. "We strongly believe that the proposed merger is good for Britain, and will continue to work closely with all interested parties," the spokesperson said.

The OFT's announcement was welcomed by rival mobile operators. Many had already expressed concerns that the merger would distort the distribution of the 1,800MHz spectrum band as Orange and T-mobile would control 84 per cent of the frequency.

A spokesperson for O2 said that the company welcomed the OFT's decision, and that it is important for UK consumers, the Digital Britain agenda and future spectrum auctions that the 1,800MHz frequency is not dominated by one company.

Vodafone reiterated its point that the UK operators' spectrum holdings should be reviewed in the UK to ensure that competition is safeguarded.

The 1,800MHz band is integral to enabling fourth-generation wireless technologies, and the government settled a deal with operators last year - before the proposed merger was tabled - to ensure that the spectrum was shared fairly.

The EC, as a general rule, should inform the relevant companies and the OFT of its decision within 35 working days.

T-Mobile was contacted for comment but has yet to reply.