The Czech Cabinet should today discuss an amendment to the telecommunication law which would require that Cesky Telecom’s local loops be made available for lease for competitors as of the beginning of 2003. Cesky Telecom, a former state-owned monopoly, is the dominant fixed-line carrier. Given the amendment, the sector regulator, the CTU, would have to draft a leasing/tariff methodology.
The timing of the above is in line with expectations; CTel stock should therefore not react. Moreover, we do not expect a rapid rise of the number of the leased lines, but certainly this will be a function of the yet-to-be determined leasing tariffs.
The Czech daily MFDnes says that flood damage at Cesky Telecom should not exceed CZK 1 bil.