BT rivals look to Europe for help

Telecoms companies are considering using new European regulations to sue the Government over BT's delays in opening its monopoly on the use of local telephone cable for high-speed internet access.

Telecoms companies are considering using new European regulations to sue the Government over BT's delays in opening its monopoly on the use of local telephone cable for high-speed internet access.

BT was due to allow in competition by 1 January 2001, but protracted wrangling over the new contracts means the deadline will slip by at least three months. This has angered BT's rivals, which believe that telecoms regulator Oftel has been too soft on BT and allowed the timetable to slip.

Competitors are considering legal action, using a European Commission draft directive. One telecoms company executive said: "We are looking at the directive very carefully and we may use it. I certainly wouldn't rule it out."

The draft directive was tabled in July by information commissioner Erkki Liikanen and is due to become European law by the end of the year. It says the process of opening up competition - known as unbundling the local loop - must be complete by 1 January 2001.

Mr Liikanen's spokesman said: "The UK government will be under a legal obligation to meet this deadline. If it is missed then companies will have the right to take the Government to court under the directive. We are, however, still hopeful that the UK will meet the deadline."

Oftel had originally planned to allow BT to unbundle by June 2001. Within days of publication it revised the timetable in line with the new directive.

Telecoms companies will sign contracts on Tuesday to give them access to BT telephone exchanges. They were due to be signed last Thursday, but the companies complained clauses were too restrictive and ambiguous. Most companies will sign the revised contracts, but they are considering lodging a formal complaint with Oftel.

One company source said: "Many of the changes are cosmetic and are not addressing the fundamental problems."