FROM DIALOG NEWSEDGE

[Agence France-Presse English Wire]

Lawmakers in Switzerland blocked on Wednesday government efforts to privatise the country's largest telecoms operator, Swisscom.

The Council of States, which is Switzerland's upper house of parliament, voted 23 to 21 not to open a debate on the issue which has provoked controversy here.

The move by the lawmakers followed a similarly close decision last month by their counterparts in the National Council, the Swiss lower house.

The Swiss government, which is Swisscom's top shareholder, announced late last year that it wanted to sell its 62.4 percent stake in the company.

However, the privatisation plans have met with opposition from the left as well as the centre-right Christian Democrats, but has the backing of other parties on the right.

Opponents argue that a sale of the state's stake could lead to the erosion of public services especially in rural and mountain areas, as well as a loss in government revenue.

Public opinion polls have also indicated strong opposition to the project.

Under the checks and balances of Switzerland's consensual political process, draft legislation is traditionally adapted to meet concerns, so a watered-down privatisation plan may yet emerge.

After it announced it wanted out, the government imposed strict limits on Swisscom's long-standing search for acquisitions abroad, a move that some analysts have said could stifle the company's revenue base.