The European Commission has opened an in-depth investigation into the proposed merger of Three and Wind in Italy.
The two operators’ parent companies announced a €21.8 million deal last August, which would see the country’s third and fourth largest telcos combine.
However, Brussels said it had concerns that the transaction could lead to higher prices, less choice and reduced innovation for mobile customers in Italy.
Specifically, it will examine the extent to which the parties are close competitors, the market incentives that would be faced by the JV and the potential response of its competitors.
The Commission has until 10 August to make a decision.
CK Hutchison Holdings and VimpelCom said in a joint statement: "[We] have had open and constructive discussions with the Commission throughout the first phase of the examination, and will continue to work closely with the Commission to obtain clearance for the JV.
"The combination of WIND and 3 Italia will bring significant benefits for consumers in Italy and we are confident that it will be approved.
"The combined business will have the scale, financial strength and a more efficient cost structure to offer Italian consumers and businesses a state-of-the-art network, greater LTE coverage and higher download speeds.
"This transaction will ensure that there is a strong third player in the Italian market that is able to compete head-on in the market place against the two larger operators.”
Brussels continues to look at another of Hutchison’s deals – the merger of Three and O2 in the UK.
It raised similar concerns as in Italy and is due to make a ruling in the next six weeks.
The Chairman of Three UK unveiled a series of measures, including a promise not to raise prices for five years, designed to help the deal get over the line last month.