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Business Briefs

May 21, 2003

European Commission fines Deutsche Telekom; IG Metall calls strike ballot; EU's Solbes says Germany making deficit progress.

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Local telephone calls may soon be cheaper in Germany if the European Commission has its way.Image: AP

Deutsche Telekom fined for unfair competition

The European Commission fined Germany’s former telephone monopolist Deutsche Telekom €12.6 million euros ($14.8 million) on Wednesday for charging rivals too much for access to its local networks. The Commission said new prices set by German regulators on May 1 were still too high and that the company must reduce them immediately. "DT, with a market share of 95 percent, remains the dominant provider of broadband and narrowband retail access," said Competition Commissioner Mario Monti in a statement. According to the Reuters news agency, a spokesman for Deutsche Telekom criticized the decision and said the telecoms giant may appeal.

IG Metall calls strike ballot

The board of Germany’s engineering trade union IG Metall said it would call on its members to vote for strikes after negotiations failed to achieve a shortened work week in the economically depressed eastern part of the country. The union’s 310,000 members in eastern Germany currently work 38 hours a week compared to the 35 hours required of their counterparts in the western part of the country. The union says the difference creates a "fairness gap," but employers say shortening the eastern week to match the west would endanger thousands of jobs in the former communist east. Should 75 percent of union members vote for the strike, labor unrest could start as early as June.

Germany makes progress in cutting deficit

European Monetary Affairs Commissioner Pedro Solbes said on Wednesday it was likely that Germany had taken enough deficit-cutting steps to comply with EU budgetary recommendations, according to Reuters. Berlin had been given a May 21 deadline to take measures that would cut its underlying deficit by one percentage point of gross domestic product in 2003, excluding the impact of economic swings. Germany, France and Portugal have all run afoul of Brussels for failing to stick to the EU’s stability pact, which stipulates euro zone members must keep their budget deficit below three percent of gross domestic product.

Compiled with information from wire services.