Exclusive: The European Commission’s competition arm confirms it is actively investigating Broadband Development UK (BDUK)
The European Commission has confirmed to TechWeekEurope it is investigating the Broadband Development UK (BDUK) project “very actively”.
BDUK is the government’s £530 million project to push fibre broadband into rural parts of the UK and is being managed by the Department for Culture, Media and Sport (DCMS). Many have raised concerns that only BT and Fujitsu are set to gain contracts with local councils involved in the project.
Thus far, only BT has gained BDUK money and today it emerged that rival Fujitsu is pulling out of the bidding in Cumbria, leaving the British telecoms giant as the only one left applying for the contract. It is also believed BT is set to get a contract in North Yorkshire, having already signed a deal in Lancashire.
Earlier this month, it emerged BT and Fujitsu would most likely be the only BDUK providers, after signing a Framework Agreement with the DCMS. That framework has been developed to offer councils a quick way of getting through the procurement process, but only allows them to hand contracts to BT or Fujitsu. If they want to use other providers, they have to set up their own procurement process and hope the government will back it with BDUK funds.
Reports had indicated the European Commission was concerned, but no statement emerged from Brussels about a formal investigation. An official probe is now in full swing, a spokesperson from the competition branch of the European Commission has confirmed.
Commission steps in
“We confirm that the BDUK project has been notified to the Commission. This is an important project for achieving the 2020 Digital Agenda targets and we understand that it has high priority for the UK government,” a spokesperson told TechWeekEurope. “We are therefore investigating BDUK very actively. The investigation is not completed yet, we therefore cannot say anything on a possible outcome.
“All state aid measures to undertakings have to be notified to the Commission by national governments for approval.”
The spokesperson could not go into specifics over why the Commission was investigating the process.
The DCMS is in negotiations with the European Commission about the state aid aspect of BDUK – something vendor Geo Networks complained about last year when it decided to back out of any bids for BDUK funding.
A source with knowledge of the BDUK process told TechWeekEurope the Commission was also worried about the speeds the government was demanding from BDUK beneficiaries. The government has said that whilst it would like BDUK projects to aim for up to 30Mbps speeds, any initiative that is already in the works and is aiming for 24Mbps or above will be given the green light.
The government wants to get 24Mbps connections out to 90 percent of the UK, with the final 10 percent to get at least 2Mbps.
BT has said it will cover two-thirds of the UK in fibre, but to get to the final third it would need help from the government. Yet it appears it is that state assistance that has now landed the whole BDUK process in hot water.
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