ANACOM reduces the cost of capital rate applicable to MEO in 2020

By decision of 14 January 2021, ANACOM approved the final draft decision to be notified to the European Commission, the Body of European Regulators for Electronic Communications (BEREC) and to the national regulatory authorities of all other European Union Member States, on the cost of capital rate of MEO - Serviços de Comunicações e Multimédia (MEO) applicable to the financial year of 2020.

Under the regulation of the electronic communications market, the determination of the cost of capital rate aims to remunerate the investments of regulated companies, and:

  • secure the correct incentive for investment;
  • ensure that there are no market distortions, through discriminatory and anti-competitive practices;
  • eliminate possible barriers to the entry of new competition;
  • protect the consumers from excessive prices.

In view of the methodology that was followed and the calculation presented and detailed in the draft decision, ANACOM determined that, in the context of MEO's analytical accounting system results for 2020, the cost of capital rate of 7.1077% should be used, which is lower than that approved for 2019 (7.4021%).

On same this date, approval was also given to the report on the prior hearing and consultation to which this draft decision, approved on 22 October 2020 was submitted.