UPDATE 3-EU questions Italy watchdog on broadband prices
* European Commission to review price decision
* AGCOM will cooperate, convinced of proposal
* Commission opinion is not binding, operators say
MILAN, Aug 12 (Reuters) - The European Commission has raised questions about the way Italian telecoms watchdog AGCOM arrived at the changes it plans to make to wholesale broadband prices, claiming they could cramp the market's ability to decide prices in Italy.
In a statement on Monday, the Commission said it has invoked the EU's review mechanism, adding that it would discuss how to amend the proposal with AGCOM over the next three months.
In July, the Italian watchdog tentatively approved lower 2013 fees for rivals who rent space on the fixed-line copper network of former monopoly Telecom Italia SpA.
That move was cheered by Telecom's rivals, but drew criticism from the company, which said it would reduce its annual income by 110 million euros ($146.23 million).
Following the decision, Telecom Italia said it wanted favorable regulatory conditions before moving forward with a plan to spin off its fixed-line network.
In Monday's statement, the EU Commission said it was concerned that AGCOM had set prices based on a market review that was not the most recent. Access prices for broadband services should reflect the most recent information, it added.
"In departing from the approach announced last year for setting access prices in the Italian broadband markets, AGCOM undermines the required regulatory certainty for all market players," EU telecommunications chief Neelie Kroes said.
In a later note, AGCOM said it was ready to cooperate with the Commission, but added that it remained convinced its proposal was proper.
The watchdog also said it believed it had already provided enough details to address the doubts of the Commission, and that it was ready to send further details if needed and to have 2013 broadband access prices set before year-end.
But the Commission's opinion is non-binding, telecom operators Fastweb, Vodafone Group Plc and Wind said in a joint statement on Monday.
The operators, all three of which fully support the Italian regulator, also said the Commission's opinion did not tally with some of its own previous positions.
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