Around 40,000 customers of Irish telco Smart Telecom had their fixed-line – including emergency calls – and broadband services disconnected Tuesday amid a growing dispute between Smart and infrastructure provider, Eircom.

The Irish communications regulator Comreg said Wednesday that an interim arrangement had been reached with Eircom to restore fixed-line services to Smart’s customers within three days.

Smart, which leases capacity for its fixed line services on Eircom’s infrastructure, is reported to have unpaid debts of around Eur1m owing to Eircom.

Telecoms.com was unable to reach Smart HQ as its phone lines have been disconnected. Calls to Eircom were not returned at the time of publication.

But Comreg, which has set up a help site for Smart customers at www.askcomreg.ie, has reached an interim agreement with Eircom for the restoration of services. Within the next three days, Smart customers will be allowed to make local and national calls and calls to emergency services and may receive incoming calls.

Broadband services however are not guaranteed.

As part of the interim solution, when service has been restored, Smart customers will be able to select a new telephone provider of their choice. A full list is available on the Comreg web site.

“This will provide operators with an opportunity to inform customers of the range of different products and services that are available in the marketplace,” said Comreg.

In a note to the London Stock Exchange, where trading of Smart shares has been suspended, the company said :”Additional short term funding remains necessary and the company is having further discussions with key shareholders on the provision of that funding.

“However, there is no certainty that this will happen,” the firm admits.

But while Smart is looking to raise funds to pay its bills, this latest turn of events may signal the end for the telco, where losses for 2005 increased 140 per cent to Eur16.4m.

The company is undergoing a significant restructuring process, which has already reduced the workforce from 348 people in August to 180 currently and disposal processes have also been initiated on the Wholesale Line Rental (WLR) and Carrier Pre Select (CPS) businesses, the payphone business and the prepaid card business.