NICOSIA (Reuters) – Cyprus telecoms CyTA is under criminal investigation for flouting the competition watchdog’s ruling to raise rates after allegations of price dumping, authorities said yesterday. State-controlled CyTA is locked in a bitter battle with the government-appointed Committee for the Protection of Competition on whether it is using its dominance to muscle smaller competitors out of the market. In a case closely monitored by the European Union, the operator was ordered to raise its rates for mobile telephony after the competition commission upheld a complaint from Lebanese-backed Areeba, a newcomer to the market. CyTA, which dominates an estimated 90 percent of the mobile telephony market, cut its rates in April. It has not complied with a directive to increase its rates and the attorney-general believes there could be a criminal case to answer, the Competition Commission said. «The attorney-general has decided to refer the matter to the chief of police to carry out an investigation,» the committee said in a statement. But the situation was complicated by Areeba seeking a court injunction against CyTA, a second court overturning the initial ruling, involvement of the public prosecutor and scrutiny from the European Union.