U.K. authorities asked to investigate the merger of France Telecom SA and Deutsche Telekom AG’s British units, saying the deal may significantly “affect competition” in the country.

The Office of Fair Trading asked the European Commission, which has authority over the merger, to transfer the case to the U.K., the regulator said in a statement distributed by the Regulatory News Service today.

Consumer groups and competitors Telefonica SA and Hutchison Whampoa Ltd. pushed for a U.K. review of the deal, which would create the country’s largest mobile operator with about 43 percent of subscriptions. Since 2004 the OFT has made four requests to take over an EU merger case, later withdrawing one, according to the regulator.

“The OFT’s initial view, following consultation, is that the joint venture threatens significantly to affect competition in mobile telecommunications in the U.K.,” the OFT said in the statement. “The OFT intends to examine the proposed joint venture with a view to deciding whether it should be referred to the Competition Commission for an in-depth investigation.”

Telefonica’s O2 mobile service is the U.K.’s current market leader, with 27.9 percent of subscriptions in 2008, according to market regulator Ofcom. Hutchison Whampoa’s 3 is the smallest, with about 6 percent.

The European Commission is the 27-nation European Union’s highest authority on mergers and must approve the OFT’s request.

Possible Delay

The commission on Jan. 12 said it would rule on the deal by Feb. 15 or extend its investigation by 90 working days. A referral to the U.K. could lengthen this schedule, since the OFT and Competition Commission, which sets remedies in antitrust cases, are not subject to the same timetable.

Deutsche Telekom “strongly believes the planned transaction is pro-competitive, and that we’ll be able to resolve any remaining concerns,” Andreas Fuchs, a spokesman for the Bonn-based company, said by phone. Bertrand Deronchaine, a Paris-based spokesman for France Telecom, declined to immediately comment.

With five full-service mobile operators, the U.K. is one of Europe’s most crowded markets. Italy and Germany each have four, while France had three until it granted a mobile license to broadband operator Iliad SA last month.

Source:Bloomberg