To address the large business segment, alternative operators use a number of Proximus’s wholesale offers. As Proximus has a significant market power in this regard, the BIPT has prohibited this operator, among other things, from applying margin squeeze practices. Price squeeze or margin squeeze does occur when the margin between all relevant revenues and the wholesale costs is not sufficient to cover the proper network and retail costs, including a reasonable return on capital. Margin squeeze can severely disrupt competition, jeopardising the possibilities of choice for the end-customer (in this case, large businesses) in the end.
The ban on using margin squeeze practices for operators having a significant market power has been included in the CRC Decision of 29 June 2018 regarding the analysis of the broadband and television broadcasting markets and the BIPT Decision of 13 December 2019 regarding the high-quality access market. In the context of its regulatory mandate, the BIPT recently examined whether Proximus is applying rates that may result in margin squeeze. The test has been conducted on the entire business portfolio of Proximus, in the light of the guidelines published by the BIPT on 22 June 2021.
The BIPT has found no evidence of margin squeezes practices at the portfolio level based on the test results. However, it cannot be deduced from this that no competitive issues will present themselves in individual cases in this segment. In light of this, the BIPT will monitor the competitive situation in this segment by performing tests at the level of individual contracts. In any case, these shall be carried out following complaints and in addition, the BIPT shall systematically subject a selection of Proximus’s individual contracts to tests.