On 6th December 1999, the Italian Communications Authority modified the tariffs for calls originating from the network of the incumbent operator Telecom Italia and terminating on the networks of mobile operators Telecom Italia Mobile (TIM) and Omnitel. TIM and Omnitel had previously been notified as having significant power in the market for interconnection and consequently the authority has decided that their tariffs for termination may not exceed 360 Italian Lira per minute.
By 30th April 2000 these operators must file figures with the authority concerning their long-term incremental costs, in order for the authority to evaluate the correct remuneration of capital calculated according to the Weighted Average Cost of Capital (WACC) method. With the same decision the authority reduced the so-called retention fee of Telecom Italia, bringing it down to a maximum of 110 Italian Lira per minute, and unified the termination tariffs, which were previously related to the time of the day and to the type of contract (i.e. business or residential) applied to the called party.
The decision can be found on the Italian Communications Authority web site at: http://www.agcom.it/provv/D338_99.htm
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