The European Competition Commissioner, Mr Mario Monti, has condemned EU member-states for slow progress in liberalising the telecoms industry.

Speaking at a public hearing on the issue in Brussels, Mr Monti described as "disappointing" efforts to give new competitors access to local exchanges owned and run by former state monopolies.

This process is known as "unbundling the local loop".

However, Mr Monti said that thus far only 900,000 telephone lines in Europe had been unbundled.

"Even in those countries where figures could seem encouraging, we have received strong signs of discontent on the conditions offered by the incumbent.

"In many countries, unbundling has not gone beyond a merely experimental stage," he said.

Mr Monti acknowledged that the economic downturn had forced many potential competitors in the telecoms industry out of business. But he insisted that the difficult economic climate provided no excuse for governments to drag their heels over liberalisation.

"Even if the current context is difficult in the telecoms sector and may thwart apparently sensible business cases, I insist on the fact that competition law applies irrespective of the economic and financial environment.

"It is not because funding is difficult that we must put competition principles aside.

"On the contrary, the more difficult the environment, the more crucial the application of competition law.

"Our objective is to maintain a competitive structure of the markets," he said.