(Updates with details, background, quote)
AMSTERDAM, Feb 27 (Reuters) - The fixed networks of the two largest Dutch telecommunications companies, KPN and VodafoneZiggo, should be opened up to rivals, the Dutch competition watchdog said on Tuesday.
Opening the networks would ensure that there is sufficient competition in the concentrated Dutch market, where the third and fourth players, Deutsche Telekom and Tele2 , are set to merge operations, said the watchdog, known by its Dutch acronym ACM.
"Because of the dominant position of KPN and VodafoneZiggo on the market for fixed telecommunications networks, without regulation, there will be insufficient competition," said ACM spokesman Henk Don. "The ACM is, therefore, proposing to regulate both parties."
It is not clear whether the ACM proposal will succeed. The regulator said market players have six weeks to respond before it finalizes the proposal for submission to the European Commission. It hopes the proposal will come into effect as policy by this summer.
The regulator carried out an analysis of the market to include the tie-up between Liberty Global and Vodafone's Dutch operations, which combined the country's largest cable network Ziggo with its second-largest mobile network.
Ziggo's cable network has never been opened for competitors, and the company has always opposed allowing access. VodafoneZiggo could not immediately be reached for comment. Dutch news agency ANP quoted a company official as saying it was studying the ACM proposal.
KPN, which was once the country's state-owned telecommunications company, already sells the use of most of its networks to internet and mobile providers.
KPN said in a response on Tuesday that it has submitted a proposal to the ACM on continued access, and that it would also allow competitors use of its complete fibre optic network for seven years.
"This makes any further remedies through ex-ante regulation by ACM unnecessary and in KPN’s view disproportionate," the company said.
ACM had asked the European Commission to let it handle Vodafone and Ziggo's merger proposal -- and was rejected.
The merger was completed in January 2017, though KPN has continued legal efforts against the rival combination, winning a procedural ruling against it at the European Union General Court in October 2017.
The Commission has generally been more concerned to see large telecoms continue investing in their networks, while ACM is more concerned about preventing market dominance. Both say they are defending consumer interests. (Reporting by Toby Sterling; editing by Jason Neely and Louise Heavens)