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BT fined £6m for breaking rules in NI public sector tender process


Ofcom fines BT £6.3m for breaking rules over Northern Irish contract (Mike Egerton/PA)

Ofcom fines BT £6.3m for breaking rules over Northern Irish contract (Mike Egerton/PA)

Ofcom fines BT £6.3m for breaking rules over Northern Irish contract (Mike Egerton/PA)

Telecoms giant BT has been fined £6.3m by regulator Ofcom for failing to share information with a rival during bidding for a major contract.

The watchdog said BT’s network division had failed to give telecoms firm Eir the same information as BT’s own bid team.

BT has admitted liability.

The companies were tendering for a nine-year public sector telecoms contract worth between £50m and £400m to provide services to over 150 organisations.

Eir had complained to Ofcom about BT’s conduct during the tender process in 2017/18.

Ofcom said that its rules require BT’s network arm to treat its wholesale customers equally as they rely on the network to provide their services.

That helped ensure a level playing field to allow other providers to compete with BT.

Gaucho Rasmussen, Ofcom’s director of enforcement, said: “BT’s network arm broke our rules by failing to treat a rival company and BT’s own bid team equally during the tender for a major public sector contract in Northern Ireland.

“Our fine reflects how important these rules are, and how seriously we take compliance.”

Both companies had been bidding for the Northern Ireland public sector shared network contract.

BT won the bid for the contract to provide shared data transfer services and calls at 2,000 sites, including schools, the police, Government departments and local councils.

The part of BT’s network arm that provided support to Eir’s bid sat within ‘BT Northern Ireland Networks’ (BTNIN).

Staff from both Openreach and BTNIN provided support to BT’s bid. In June 2018, BT’s bid team won the contract.

Ofcom said that BT’s network arm broke rules during the tender process as it did not give Eir the same information it gave to its own bid team about BT’s fibre to the premises on demand product (FOD).

Ofcom said BT’s network arm sent a message to Eir that FOD was not a suitable solution for its bid and that it had delivery limitations.

But the BT bid team was given information suggesting FOD was suitable for major multi-site network upgrade projects of the type being tendered for, and could be delivered at such a scale.

It also did not provide the same information on pricing and costs of the FOD product. And it did not provide certain information to Eir on the same timescales and by the same processes as it did for BT.

But Ofcom said it did not believe the breaches were deliberate, and that BT had implemented compliance processes to address the risk of not treating the two bidders equally.

Ofcom said its fine of £6.3m included a 30% cut to reflect that BT had agreed to settle the investigation by admitting liability, and had cooperated with the investigation.

Ofcom’s investigation did not make any findings on whether the breach had affected the outcome of the tender process.

A BT Group spokesperson said: “We regret the level of service we provided to this communications provider during this tender process in Northern Ireland.

“We’ve cooperated with and accepted Ofcom’s findings and have already put measures in place to prevent this happening again. We also continue to review how we can improve our service.

“Ofcom recognises that these errors weren’t deliberate and that we took a number of steps to comply with the regulatory obligations.

“Based on Ofcom’s decision, we don’t believe this impacted the tender outcome.

“Our focus remains on constantly improving our levels of service to customers as we make significant investments in 5G and full fibre networks across the UK.”

Philip O’Meara, regional director eir Business Northern Ireland, said: “eir Business Northern Ireland welcomes today’s decision by Ofcom that BT unduly discriminated against eir in tendering for the Northern Ireland public sector shared network contract. The size of the fine imposed by Ofcom on BT illustrates the gravity of BT's behaviour.

"We firmly believe that had BT complied with its regulatory obligations, we would have retained the NIPSSN contract. We are considering our options in light of today's decision and BT's admission of liability. eir Business Northern Ireland is keenly committed to its customers and to ensuring a fair and competitive market place for telecoms services.”

Belfast Telegraph