A Paris appeals court ruled on Wednesday that mobile operator Orange must give up its exclusive rights to sell the iPhone in France, upholding a ruling by France's competition authorities.
National competition regulators suspended the five-year exclusive sales deal between iPhone manufacturer Apple and France Telecom's mobile arm Orange on December 17. Both Apple and Orange had appealed the ruling.
A spokesman for Orange told AFP it would seek to overturn the ruling before France's high court of appeal, the Cour de Cassation.
Rival operator Bouygues Telecom filed suit against Orange before the French competition council in September, and was joined by France's third main mobile carrier SFR and the French consumer rights group UFC-Que Choisir.
Both Bouygues and SFR welcomed the ruling and said they hoped soon to be able to offer the iPhone in their stores, saying talks were underway with Apple to finalise distribution agreements.
Since the December decision, the iPhone has been available to buy on several French websites, bundled with rival mobile phone contracts but not yet in SFR or Bouygues Telecom stores.
Industry sources said the firms were expected to start selling it directly within five to six weeks.
Competition regulators had ruled that the deal risked introducing "a new element of rigidity in the sector which is already suffering from a lack of competition."
UFC-Que Choisir's lawyer Jerome Franck welcomed the ruling as good news for consumers, saying more competition would "certainly drive down the iPhone's price."
Orange says it has sold more than 600,000 iPhones in France since it began offering them in November 2007.
© 2009 AFP