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UPDATE 1-Argentine court suspends Telecom antitrust ruling

Published 07/28/2009, 10:35 AM
Updated 07/28/2009, 10:48 AM
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* Telecom Italia has say on Telecom Argentina board

* Court overturns antitrust ruling

* Telecom Argentina shares up 2.5 pct

(Adds details, background, quote, share price)

BUENOS AIRES, July 28 (Reuters) - An Argentine court ruled that representatives from Telecom Italia may participate in management decisions regarding its local affiliate, Telecom Argentina .

The Federal Civil and Commercial Chamber issued the ruling on Monday, overturning an earlier antitrust ruling, according to a court document seen by Reuters.

In April, Argentina's antitrust authority, the National Competition Defense Commission, known by its Spanish-language acronym CNDC, ordered Telecom Italia's representatives on Telecom Argentina's board not to participate in decisions concerning management.

Telecom Italia appealed first to the antitrust authority, but that appeal was rejected, so it then went to the court.

"The judicial decision clearly expresses that the CNDC resolution affects the rights of Telecom Italia as well as confirming Telecom Italia's position that the CNDC does not have the authority to resolve as it did," said a statement from a publicist for Telecom Italia in Argentina.

Argentina's antitrust commission is investigating the possible dominant position of Spain's Telefonica SA in Argentina's telecommunications market because it controls telephone company Telefonica Argentina , which competes with Telecom Argentina.

Telefonica also owns a stake in Telecom Italia.

Telecom Italia has considered selling its stake in its Argentine company due to the antitrust probe. Telecom Italia owns half of Sofora Telecomunicaciones SA, the holding company that controls Telecom Argentina.

Telecom Italia shares were down 2.29 percent to 1.023 per share in Milan.

In New York, Telecom Argentina's American Depositary Receipts rose 1.9 percent at $13.32 per share in early trade. (Reporting by Walter Bianchi and Nicolas Misculin; Writing by Fiona Ortiz, editing by Gerald E. McCormick and Derek Caney)

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