Orange faces a consistent flow of litigation and
therefore favours external firms with branch offices across Spain,
says legal commercial general counsel Antonio García
French mobile and internet service operator Orange completed its
100 per cent takeover of Spain's Jazztel in August of last
year, in a transaction totalling €3.4 billion. Orange was
advised by Jones Day on the deal. "The transaction will allow
Orange España and Jazztel to jointly build the most dynamic
carrier in the Spanish market," the Paris-based company said
at the time. Orange expects to save around €1.8 million as a
result of the synergy of the two companies in the Spanish market.
The Spanish arm of the French carrier now has more than 19 million
customers, including one million customers on fibre networks and
more than six million on 4G.
Litigation is common
The fact that Orange has such a large customer base means that
litigation is a frequent occurrence, according to the company's
legal commercial general counsel in Spain, Antonio García
Martínez. He claims that Orange is "engaged in a
constant process of improvement of its services with the aim of
bettering the quality of services and therefore reducing the number
of claims brought against it by its customers". However,
despite these efforts, the company is still on the receiving end of
hundreds of law suits from disgruntled customers each year.
"To have between 400-500 cases a year for such a large firm is
a relatively small number, although we are not happy with this and
we are always striving to reduce it," he claims.
Though hundreds of customers take legal action against Orange,
García Martínez claims that the "customer is our
priority". He adds that the company's focus on customers
means that "even one small claim is a big problem for
Orange". Meanwhile, other types of litigation involving Orange
include the company bringing legal action against its suppliers in
contract disputes. However, García Martínez says that
this is something that is quite unusual, because the company's
legal department aims to "put all the legal filters in place
to avoid that".
Too many cases to handle
The company outsources part of its legal work because its
customers are widely dispersed across Spain, which means the
business can be simultaneously engaged in cases around the country.
García Martínez says it would be impossible for the
company's in-house legal team to handle such a large number of
disputes as its personnel would be overstretched. So what types of
law firms does Orange use? "We use large law firms that have
branch offices across the country – we open a tender in which
the law firms present their technical and economic proposals, and
we choose the best based on each criterion," García
Martínez explains. This means, in theory, that the company
can use a different law firm each time, but obviously the
experience of law firms in working with Orange in the past is taken
into consideration when the bids are analysed.
Invited to tender
How does Orange choose which law firms to use? "The
selection process is carried out by the procurement department, and
what they look for is the best proposal in all senses," says
García Martínez. He adds that Orange takes steps to
ensure that the law firms that participate in the tender are of a
particular standard. "The high quality of the proposals and
the participating law firms is guaranteed by the fact that bidders
are invited to participate, rather than it being a publicly
announced tender," he explains. In the case of Orange, a
factor that may put one law firm at an advantage over others is a
presence in a larger number of regions of Spain, given the
carrier's wide coverage.
Spanish firms' advantage
As a result of the company's need to hire law firms with a
strong regional presence, the likelihood of a Spanish law firm
being the successful bidder is high, according to García
Martínez. That said, foreign law firms are also invited to
participate in the tender process, given their expertise and
experience in the relevant areas. The type of case is also a factor
in the selection of an external law firm, says García
Martínez. He cites Ejaso, Cremades & Calvo Sotelo and
ABG Abogados as among the law firms that Orange has used in Spain.
García Martínez says the firms have "served the
company well in a variety of cases and regions".
Antonio García Martínez is Orange's
legal commercial general counsel in Spain.
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