BT Network Arm Should Have Separate Structure, Says U.K. Regulator

By Rory Gallivan 

LONDON--The U.K's telecommunications regulator Tuesday called for BT Group PLC's network business to become a distinct company with its own board, but stopped short of calling for a full separation of the businesses.

Ofcom said Openreach should become a legally separate company from the rest of BT, but remain part of the BT Group. Openreach should have a chief executive who is accountable to the Openreach board rather than BT Group, it said.

Under Ofcom's proposals Openreach would be obliged to consult with customers such as BT's competitors Sky PLC and TalkTalk Telecom Group PLC about investment plans.

Ofcom said it will seek views on its proposals until Oct. 4.

BT, a former state-run monopoly known as British Telecom, lays down most of the U.K.'s telecoms lines and makes a hefty chunk of its revenue though its Openreach division by connecting the country's copper wire and high-speed fiber-optic cable network. For years, BT has faced calls for increased regulatory pressure on the division by rival operators, which lease the network on a wholesale basis to reach their own customers.

Simon Zekaria contributed to this article.

Write to Rory Gallivan at [e-mail]

(END) Dow Jones Newswires

July 26, 2016 02:56 ET (06:56 GMT)

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