BRUSSELS, Oct 28 (Reuters) - Europe's biggest

telecommunications companies urged the head of the European

Commission on Tuesday to loosen EU merger rules, a move they

said would boost much-needed investments in digital

infrastructure and help them compete with U.S. and Asian peers.

The call by the chief executives of Deutsche Telekom

, Orange, Telefonica, TIM

, Vodafone ( VOD ), Nokia and Ericsson

comes as the Commission is set to announce a

legislative proposal to revamp the sector.

The Digital Networks Act, currently scheduled to be unveiled

in November, aims to take a more comprehensive approach to help

ramp up digital infrastructure across Europe.

It hit a stumbling block last week, however, when an

internal Commission body issued a negative opinion on the

legislation, according to a person with direct knowledge of the

matter.

"The Digital Networks Act is a crucial opportunity," the

CEOs wrote in a joint letter to Commission President Ursula von

der Leyen.

"Unless the Commission takes bold action with a clearly

stated intent to address the need for scale, European industries

will continue to lack the strength to invest at the same pace as

their competitors in the United States, Asia and other markets,"

they wrote.

The telecoms industry has voiced concern the DNA will ignore

their calls to ease the path for large mergers, particularly

those which reduce the number of players in a market from four

to three. Antitrust regulators have long viewed that level of

consolidation as a precursor to price hikes considered harmful

to consumers.

"The Commission must act boldly to recognise the link

between scale and investment, and a much simplified regulatory

framework that increases investment capacities," the executives

said.

Other signatories to the letter included BT Group, CK

Hutchison Group Telecom, KPN, Liberty Global ( LBTYA ),

FiberCop, Swisscom and Telenor ( TELNF ).