Esat Telecom, the Irish telecoms firm, has made a formal complaint to the telecoms regulator about the award of a €130 million Government telecoms and internet contract to Eircom and Vodafone.
The complaint - which is based on the prices that Eircom bid in a State tender for the contract - could lead to legal action and a suit for damages against the State by Esat, if it is upheld by the regulator.
Esat lodged its complaint following confirmation from the Department for Finance that it had awarded the contract - the biggest single State telecoms supply deal to date - to the two incumbent operators, Vodafone and Eircom.
The contract, which is worth about €130 million over five years, will see Eircom and Vodafone supply a range of telecommunications services to public bodies and Government departments. They will also supply and maintain a backbone telecoms and internet infrastructure to enable a planned e-government initiative.
Mr David Taylor, director of regulatory affairs at Esat, said yesterday Esat had lodged its complaint to the regulator and would fight for the right to compete for Government business in the State.
Esat, which this week reported losses of €74.6 million for the three months to December 31st, 2001, believes the Government is failing to promote competition through its own supply deals.
It is believed the firm is particularly concerned that the tender document for the telecoms contract was written in a manner which favoured Eircom, which has the biggest network.
It is understood Esat is just one among several firms which are angry at the award of the State telecoms contract to the two incumbent telecoms operators.
Colt, the British telecoms firm which provides services to businesses here, has also sought clarification from the telecoms regulator on some aspects of voice telecoms contracts with the Government. But the firm would not comment on the issue when contacted.
Other firms which expressed a formal interest in the original contract include: Global Crossing, Cable & Wireless, GTS, Compaq, Cara Group, ESB, Entropy and the cable firm Chorus.
A spokeswoman for the telecoms regulator said yesterday that the office would not comment on individual cases. But she confirmed the regulator had a responsibility to ensure that Eircom, which has significant market power in the Irish market, conformed to its published prices.
It is believed Esat's complaint focuses on whether Eircom included off-book pricing, or other potentially anti-competitive practices in its bid for the contract.
A Department of Finance spokesman confirmed Eircom and Vodafone had recently been awarded the virtual private network contract. But he would not comment on the issue of any complaint made by Esat.
Eircom would not comment on the contract.
Meanwhile, an Esat spokeswoman said yesterday the firm was totally committed to the Republic and would not pull out of the residential market.
