After the European Commission warned it may take legal action against European member states over their "very disappointing" handling of local loop unbundling, in its latest report it confirms the paucity of movement in this area.

The EC's 7th Report on the Implementation of Telecommunications Regulatory Package, published on Wednesday, found not enough had been done to open up local networks and branded Europe's handling of local loop unbundling — LLU, or the process by which telcos must make telephone lines available to competitors — as "not satisfactory".

Competition Minister Mario Monti said the EC would start taking action against states on 20 December.

Telco watchdog Oftel has taken several steps, such as imposing charges on BT for every day it is late delivering services to rival operators, to push the process forward.

But BT, responsible for opening up its exchanges, is already more than 10 months behind schedule.

Despite the fact that LLU has been mandatory in European states for over a year, many countries, which were not named in the report, have been accused of dragging their feet.

Oftel said the UK was ahead of most member states in the unbundling process and it was felt positive the UK would not be facing legal action.

But the UK is desperately falling behind other countries such as Germany, which has around 500,000 unbundled lines — as of June this year the UK had only 150 lines.