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OFT makes special exemption for bumpkins' wayleave charges

Milking the cows of industry BT to speed up broadband rollout

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Getting faster broadband connections in rural areas remains a bugbear for many of the locals who live in the harder-to-reach parts of Blighty. So clarification from the Office of Fair Trading (OFT) on competition law relating to wayleave rates has been unsurprisingly welcomed by landowners in the countryside today.

The regulator has published a short-form opinion [PDF], which was sent to the National Farmers' Union (NFU) and the Country Land and Business Association (CLA), that it said clarified exactly how competition law was applied to the recommendation of a rate to be charged by their members for allowing broadband cables to cross their land.

Landowners receive fees on an annual or one-off basis to cover wayleave rates, allowing, for example, comms' providers such as BT to install, maintain and repair broadband cabling on private land.

The OFT said - as part of the effort to speed up delivery of speedier net connections in rural settings - that the NFU and CLA would set a wayleave rate that would be below current commercial fees paid to landowners. Or else urge their members to altogether waiver the charges in relation to the laying of mainly backhaul cabling, the rollout of which presents "the biggest challenge", in return for, say, a broadband connection.

"Their aim is to speed up the roll out of rural broadband services, where time-consuming negotiations between many individual landowners and broadband providers to agree wayleave rates have contributed to delays to rural broadband projects," the watchdog said.

But the groups first needed the OFT to clarify whether such a plan was compatible with competition law.

The watchdog concluded:

The guidance published by the OFT notes that, in general terms, the recommendation of fixed prices by a trade association to its members is likely to restrict competition and breach competition law.

However, on the basis of the information provided, the OFT considers that in this case the recommendation could meet the criteria for individual exemption from the Competition Act 1998.

The OFT notes, in particular, that the recommendation is capable of generating benefits that outweigh the restriction of competition it creates, by speeding up the roll out of effective broadband to people living in rural areas.

The idea that wealthy landowners, farmers and other rural businesses needed access to faster broadband was endorsed by the regulator, reflecting culture secretary Jeremy Hunt's one-track-mind on the topic.

In a joint statement, the associations said:

We are pleased the OFT has recognised the proposed recommendations could meet the criteria for an individual exemption from competition law, and that they are intended to confer wider benefits in terms of a greater deployment of rural broadband infrastructure.

The NFU and CLA now need to read the OFT's Opinion in detail and to assess fully the competition law implications of the proposed recommendations in the light of this Opinion, before commenting further.

Hardly a hunter-gatherer

Earlier this week, Hunt slightly revised his frankly clear-as-mud plan to turn the UK into having the fastest connected broadband coverage in Europe (with lots of caveats) by 2015.

Anyone closely reading his words will note the following: Hunt said he hoped to see Britain equipped with the "fastest broadband of any major European country" without telling us which major nations in the EU he was referring to.

Surely, old Jez isn't being disingenuous about exactly how the now-delayed-due-to-EU-intervention-on-competition-concerns-regarding-state-aid relating to the BDUK rollout, is he?

What now appears to be clear is that Hunt is no longer making the absurd claim to gift the UK with the "best superfast broadband network in Europe by 2015". Belgium, Romania, Latvia, the Netherlands... you get the picture... were always a threat to Britain especially given that in the most recent quarter, its broadband speed score in Europe was miserably spotted languishing in 15th place. ®

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