The Netherlands Authority for Consumers and Markets (ACM) cited provisional concerns over a potential loss of competition for low cost mobile services resulting from a €200 million move by KPN to acquire MVNO Youfone, with the regulator set to take a deeper look at the deal.

In its statement, the authority raised concerns the buy could lead to higher prices or reduced options for consumers, highlighting no-frills provider Youfone’s current position exerting price pressure on rivals.

Although the MVNO uses KPN’s network, ACM noted as an independent player it could opt to use a rival’s infrastructure instead.

This factor, it claims, may “boost Youfone’s bargaining position in the negotiations with KPN about the use of its network, and it enhances Youfone’s ability to compete on low prices”.

In its full investigation, ACM is set to assess if KPN’s proposed acquisition is likely to cause a deterioration at the cheaper-end of the mobile market and probe whether other providers were positioned to become “the driving force of competition”.

When it pitched the deal, KPN stated the MVNO would continue to operate independently, pledging its current and future customers would “continue to be served in the way they are used to”.

Youfone also operates in Belgium, though this part of the business is not included in the proposed deal.