The Court of Appeal has turned down an appeal lodged by the Commission against a High Court ruling in April 2008. The High Court found that Telecom did not use its dominant position in the market for fixed line retail telephone services to residential customers, or have an anti-competitive purpose when it introduced its 0867 package in 1999, and so did not contravene section 36.

"The Commission is disappointed but will study this ruling, and consider next steps," said the Commission's General Counsel Peter Taylor.

In June 1999 Telecom announced that residential customers would be charged for calls to internet service providers (ISPs) unless they used an 0867 dial-code and Telecom only made the 0867 number range available to other telecommunications network operators if they agreed that the 0867 number range was not covered by existing interconnection agreements, so that Telecom was not required to pay charges relating to those calls. Telecom sought to introduce a two cent per minute charge to customers not using the 0867 prefix after 10 hours' use.

The Commission alleged that in introducing the 0867 scheme Telecom sought to prevent or deter competitive conduct by other carriers and ISPs.

The Commission will be making no further comment on the judgment at this time. The judgment is available on the Commission's website www.comcom.govt.nz under the Litigation Register.