Liberty Latin America, the regional telecom company poised to take over AT&T operations in the territory, is now facing a federal antitrust lawsuit for trying to eliminate too much competition in Puerto Rico.
According to a recent news release, the U.S. Justice Department’s Antitrust Division filed the civil antitrust lawsuit on Oct. 23 in the U.S. District Court for the District of Columbia to block the proposed merger, and also filed a proposed settlement requiring Liberty Latin America to divest “certain fiber-based telecommunications assets and customer accounts” in Puerto Rico.
“The merger, as originally structured, would have eliminated competition for critical fiber-optic-based telecommunications services that businesses in Puerto Rico rely on every day,” said Assistant Attorney General Makan Delrahim of the Justice Department’s Antitrust Division.
“[The] settlement will ensure that businesses throughout Puerto Rico continue to benefit from vigorous competition in the provision of these services.”
The complaint alleges that competition between Liberty and AT&T has resulted in lower prices and higher-quality services for customers. By combining Liberty and AT&T, many customers would be left with only one alternative and others with no competitive choice at all, likely resulting in increased prices and lower-quality services for enterprise customers across Puerto Rico, the complaint continued.
Under the terms of the proposed settlement, Liberty Latin America would divest certain wireline telecommunications assets and customer accounts in Puerto Rico to WorldNet — the largest locally-owned telecommunications provider in Puerto Rico — or to an alternative purchaser approved by the United States.
Liberty Latin America has yet to make a public statement about the settlement.
The acquisition of AT&T by Liberty Latin America was announced in late 2019. The $1.95 billion deal means AT&T network assets — including spectrum, real estate and leases, customers, including 1.1 million wireless subscribers; contracts, and roughly 1,300 employees — will move under Liberty Latin America.
A recent notification from AT&T indicated that the AT&T wireless service and other agreements will be with Liberty and not with AT&T Mobility, LLC, or any of its affiliates, by Saturday.