Ofcom has today announced that BT has agreed to Ofcom’s requirements for the legal separation of its network division.

This means Openreach will become a distinct company with its own staff and management, together with its own strategy and a legal purpose to serve all of its customers equally.

BT has agreed to all of the changes needed to address Ofcom’s competition concerns. As a result, Ofcom will no longer need to impose these changes through regulation. The reforms have been designed to begin this year.

To ensure implementation, legislation will be needed to maintain the Government’s ‘Crown Guarantee’ for Openreach staff who are members of BT’s pension scheme.

The new Openreach will have the greatest degree of independence from BT Group without incurring the delays and disruption – to industry, consumers and investment plans – associated with separating the companies entirely.

BT’s commitments, combined with regulation imposed by Ofcom through its regular market reviews, will form a comprehensive solution to problems in the market that Ofcom had identified.