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Margin squeezes (also called "price squeezes") may occur if a vertically integrated operator sets a margin between the price of its wholesale services and the price of its retail services that is insufficient to cover the costs specific to the retail market. In 2007 BIPT adopted guidelines concerning the assessment of margin squeezes.

BIPT wishes to adopt new guidelines in the light of the developments that have since occurred in this field. With this goal in mind, on 4 December 2015, BIPT launched a consultation on a draft of new guidelines as well as two corresponding spreadsheets, developed in order to detect possible margin squeezes for retail services provided to residential customers and small business users based on BROBA and WBA VDSL2 (Shared VLAN) as well as multicast.

In March 2016 a second consultation round took place relating to the spreadsheet that was specifically developed for retail services provided on the basis of cable access. Today BIPT wishes to organise a third and final consultation round, related to the spreadsheet for detecting possible margin squeezes regarding retail services for large business users, based on BROBA, WBA VDSL2 and NGLL. Possible margin squeezes shall be examined per wholesale market, on a contractual basis (case by case).

In the model, revenue and costs shall be considered for both access services (for all lines from a given contract) and non-regulated additional services. This consultation will deal with a spreadsheet in Excel format, developed to detect any margin squeezes practiced by the operators with a significant market power, regarding retail services for large business users.

Deadline: until 12 August 2016

Address: consultation.sg@bipt.be

Ref. : CONSULT-2016-B7

Contact persons: Vincent Hanchir, Chief Economist (02 226 87 78) and Tom Van Landeghem, Advisor (02 226 89 40)

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