Vodafone is suing rival Telecom Italia for abusing its dominant position in Italy’s telecoms market, and is seeking damages in excess of €1 billion.

Telecom Italia and Vodafone are number one and two respectively in the country’s mobile market, but the case relates to their fixed-line activities.

Vodafone claims it faced unfair competition between 2008 and 2013 as it pursued a strategy of building up its fixed business in order to better compete with Telecom Italia, which present in both fixed and mobile services.

The incumbent restricted access to its fixed network and charged discriminatory and unfairly high wholesale rates, said Vodafone.

The case follows a decision in May by Italy’s competition authority to fine Telecom Italia €104 million for abusing its dominant position in the fixed market. The incumbent said it would appeal the decision. It also rejects Vodafone’s claim.

According to figures from the country’s telecoms regulator, Vodafone had a market share of about 10 per cent in the fixed access market (Q1, 2013 figures), compared to Telecom Italia’s 64 per cent.  The other leading fixed competitors are Wind and Fastweb.

Italy is one of the European markets where Vodafone has in recent years attempted to build up a fixed market share alongside its mobile presence.

For instance, it acquired Tele2’s Italian (and Spanish) fixed businesses for a total of €775 million in 2007.

And of course it is currently in the midst of acquiring Germany’s Kabel Deutschland.