The European Commission has given the green light to a takeover of mobile network O2 Ireland by rival Three. The Commission had previously expressed concerns that the merger would have removed an important competitive force from the Irish mobile market.

Three owners Hutchison 3G submitted commitments to the the Commission, ensuring them that new competitors will enter the Irish mobile market. The Commission says this removed thier concerns.

These included the short-term entry of two mobile virtual network operators - with an option for one of them to become a full mobile network operator at a later stage - and a package aimed at ensuring that Eircom stays a competitive mobile network operator.

Commission Vice President in charge of competition policy Joaquín Almunia commented "In a context of increased data consumption on their mobile devices, European consumers should continue to benefit from improved services at attractive prices".

"To achieve this, it is essential that healthy competition is preserved in mobile telecoms markets. The commitments offered by Hutchison 3G ensure that Irish consumers will continue to enjoy these benefits" he added.

Ireland is a relatively small telecoms market, with around 4.6 million inhabitants and 5.5 million mobile telecoms subscriptions. All mobile network operators in Ireland already share networks to reduce the cost of their roll-out.

The merger will bring together the second and the fourth largest mobile network operators here. It is set to create a larger company facing only two competitors: Vodafone and Eircom.

Three CEO Robert Finnegan says it will have "the scale and financial strength necessary to compete more aggressively against the number one in the market" and "create new competitive dynamics in the Irish telecoms market".

"This deal will enable Three to invest significantly in building a state-of-the-art 4G network, delivering very real benefits to customers in urban and rural areas throughout the country" Finnegan added.

Both O2 and Three say customers will not be affected by the takeover.

O2 was bought by Three in a deal worth up to €850 million in June of last year. Three paid €780 million up-front, and will pay a further €70 million depending on the financial performance of O2.

O2 is owned by the Spanish telecoms company Telefonica. Hutchison 3G Ireland is a subsidiary of Hong Kong-based Hutchison, selling services under the brand name "Three".

The combined companies have nearly two million customers and a 37.5% share of the mobile market.