Government seeks explanation over possible irregularities in UMTS auction

If an agreement between Deutsche Telekom and Tele Danmark did indeed take place, diAx/Sunrise risks having to give up its UMTS licence Keystone

The government has asked for urgent clarification of rumours that there may have been a secret agreement between Tele Danmark and Deutsche Telekom in the run-up to the auction of third generation mobile phone licences.

Deutsche Telekom’s T-Mobile subsidiary withdrew from the bidding just three days before the auction was due to begin in November. Two days later, Tele Danmark acquired majority stakes in two Swiss bidders, diAx and Sunrise, and then announced plans to merge them.

That move led the government to postpone the sale for several weeks.

DiAx went on to obtain a licence in December’s auction which netted just SFr205 million ($128 million) for the government.

Now, there are rumours that Deutsche Telekom may acquire a large stake in Tele Danmark.

The US telecommunications group, SBC Communications, holds a 42 per cent stake in Tele Danmark and is free to sell this from January 12 under an agreement with the Danish government.

The Federal Office for Communications said on Monday that it had written to DiAx to ask it to clarify whether any agreements were made prior to the sale.

A spokeswoman said the letter had been forwarded to Tele Danmark.

If the allegations are substantiated, DiAx could lose its UMTS licence.

The finance ministry had been hoping to earn billions from the auction but was disappointed as the original field of 10 bidders dwindled to just four. Only four licences were up for sale.

swissinfo with agencies