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EU Regulators Fine Spanish Telecommunications Company

European Union regulators have fined Spanish telecommunications company Telefonica $206 million for setting high prices on services used by its rivals.

The commission says Telefonica had set prices so high that rival operators could not make a profit on their services.

The formerly state-owned company controls the fixed line telecommunications network used for about 80 percent of high-speed Internet connections in Spain. Rival operators need to buy access from Telefonica to provide competing retail services.

EU Competition Commissioner Neelie Kroes Wednesday said that she would not allow dominant companies to use their market power to close down markets. She said Telefonica's actions harmed customers as well as businesses.

However, Telefonica says it obeyed market rules and will appeal the EU decision.

Some information for this report was provided by AFP, AP and Reuters.