Tuesday, 31 July 2012

OFT notified of Vodafone/Telefonica proposed joint venture

OFT notified of Vodafone/Telefonica proposed joint venture (see related page).

ARCEP consults on refarming 1800 MHz

"The company Bouygues Telecom holds a licence to use spectrum in the 1800 MHz band to deploy a second generation (2G) mobile network, corresponding to GSM technology.

In an informal fashion for several months, and then in a letter dated 19 July 2012, Bouygues Telecom appealed to ARCEP for permission to use its spectrum in the 1800 MHz band for a fourth-generation (4G) network, based on LTE technology, by virtue of Article 59 II of Order No. 2011-1012 of 24 August 2011 on electronic communications.

Bouygues Telecom has argued lifting the GSM-systems-only restriction attached to 1800 MHz band frequency licences must enable the use of additional resources for deploying ultra high-speed mobile networks, in addition to the 800 MHz and 2.6 GHz band spectrum that was already allocated following a call for applications in 2011.


It is within this context that ARCEP has been engaged in preparatory work on the prospect of technologies other than GSM reusing the 1800 MHz band. This work has been carried out in concert with the stakeholders, in particular through a series of meetings between mobile network operators and ARCEP Executive Board members from late June to early July.

ARCEP is now launching a public consultation, which will run to 28 September 2012, to obtain feedback from the stakeholders on the terms and methods for lifting the GSM systems only restriction attached to 1800 MHz band frequency licences" (see press release).

OFCOM consults on proposed changes to Licence Exemption of Wireless Telegraphy Devices

OFCOM consults on proposed changes to Licence Exemption of Wireless Telegraphy Devices.

"...This consultation proposes the following changes to the existing arrangements for licence exemption by:
  • setting a date to close the 10.675 to 10.699 GHz band after which no new Short Range Device (SRD) devices will be able to be deployed. Equipment in use prior to the closure date will continue to be licence exempt. We are proposing to give industry 18 months notice of this decision; and
  • extending the licence exemption for Mobile Satellite System (MSS) user terminals to include the 1518 to 1525 MHz, 1525 MHz to 1559 MHz, 1626.5 MHz to 1660.5 MHz and 1670 to 1675 MHz bands." (see related page).

Monday, 30 July 2012

Spanish NCA opens infringement proceedings against DTS and Telefonica

"On 28 January 2010, the Council of the CNC ordered that infringement proceeding S/0020/07 TRIO PLUS concerning anti-competitive practices be terminated by commitments. In that case, the CNC analysed, among other matters, several joint marketing agreements for pay-TV services and certain electronic communication services entered into by SOGECABLE, S.A. (now PRISA TV), DTS and various telecommunications operators, including TELEFÓNICA.

The commitments submitted by the parties, which resulted in the proceeding being concluded after the CNC accepted a termination by commitments arrangement, included the obligation to ensure that the products jointly marketed by DTS and TELEFÓNICA could be acquired separately for the same price.

As a consequence of the work undertaken to monitor fulfilment of these commitments, the CNC Council has decided to open a new infringement proceeding on the ground that the sale of the "DIGITAL+ mini" package to new DTS clients exclusively though the TRÍO+ channel, which sells DTS and TELEFÓNICA products together, constitutes an infringement of the CNC Council's Resolution of 28 January 2010, referred to above" (see the press release).

Commission's Art. 7 Comments to Latvian NRA on the latter's review of the retail fixed call services market

The European Commission made the following comments in its decision addressed to the Latvian NRA on the latter's review of the retail fixed call services market:

"Effectiveness of wholesale regulation

The Commission would like to recall that, in order to establish that the first criterion is met, NRAs should demonstrate that, within the period of the review, entry barriers are sufficiently high and non-transitory to prevent entry capable of limiting the SMP operator's market power. The Commission notes the limited relevance of CS/CPS and the lack of WLR in Latvia. The Commission further notes, however, the apparent ability of alternative operators to obtain wholesale broadband services from the incumbent, which offers the possibility to provide voice services to end users via regulated wholesale broadband services.

Whilst the Commission does not dispute SPRK's final conclusion with regard to the application of the three criteria test in relation to the market for national calls, the Commission urges the Latvian regulator to strengthen its efforts to ensure the full effectiveness of related wholesale remedies, for example through enhanced compliance enforcement.

Furthermore, the Commission invites SPRK to rigorously monitor the market developments in order to establish whether the effective application of wholesale regulation would mean that the first or second criterion are still met in the future. In particular, the Commission invites SPRK to establish whether the introduction of naked DSL on the wholesale level has a positive effect on the competitive situation in the retail market for national calls.

Consequently, the Commission asks SPRK to re-assess the market for national calls without delay, should competition, which may be evidenced by a more rapid decrease in SIA Lattelecom's market shares, develop and to aim for the withdrawal of regulation as soon as the first or second criterion are no longer met."

Sunday, 29 July 2012

Commission, BEREC and ARCEP reach compromise in MTRs case and end phase II

The European Commission, BEREC and Arcep have reached a compromise as regards the mobile termination rates case that was moved to phase II under art. 7a (see older post), after the latter proposed new remedies in the beginning of July. The text of the Commission's decision ending phase II has been made publicly available and the French NRA's proposal read as follows:

"On 4 July 2012 ARCEP provided the Commission with an amendment of its draft measures. Whilst market definition, SMP assessment and the type of remedies remain unchanged, with regard to the details of the price control remedy ARCEP proposes to shorten the period of asymmetry until 30 June 2013.

Furthermore, ARCEP proposes that any full MVNO entering the market as of 1 July 2013 is to be regulated on the basis of symmetric MTRs, except in exceptional circumstances.


As regards the duration of asymmetry, the asymmetric MTRs for the new entrants
concerned by ARCEP's decision will be applicable as from the entry into force of the
final measure until 30 June 2013. Therefore, ARCEP proposes the following glide path
for Free Mobile, Lycamobile and Oméa Télécom as shown in table 4

                               Until 31 December      From 1 January 2013            From 1 July 2013
                                    2012                         until 30 June 2013              until 31 December 2013

MTRs (in Euro
cents/min)                             1.6                                1.1

                                  ------------------------------------------------              0.8

PNB (Euro per
year)                                  1 600                              1 100

As regards the level of asymmetry, ARCEP notes that the difference between the new entrants' MTRs and the established MNOs' MTRs would only be 0.6 Euro cents/min in the second semester 2012 and 0.3 Euro cents/min in the first semester 2013. Furthermore, ARCEP explains that this level of asymmetry should be put into context, and account be taken of low market shares of the new entrants within the relevant time period.

In this respect, ARCEP estimates that the average MTR, if an optimistic market share of 10% for the new entrants is considered, would amount to 1.06 Euro cents/min, compared to the regulated rate of 1.0 Euro cents/min in the second semester 2012, and 0.83 Euro cents/min, compared to the regulated (and pure BU-LRIC) rate of 0.8 Euro cents/min in the first semester 2013. ARCEP considers that these differences of 0.06 Euro cents/min in the second semester 2012 and 0.03 Euro cents/min in the first semester 2013 would not affect the ability of an operator to launch unlimited all-net offers to acquire or retain customers.

ARCEP also estimates that the savings of the established MNOs from dating the end of the MTR asymmetry back from 31 December 2013 to 30 June 2013 would amount to  between EUR 5 million and EUR 20 million.

ARCEP finds that the level of asymmetry as proposed in the amended measures is not likely to distort or restrict competition and that the asymmetric rates contained in the amended draft measures are not likely to reduce consumers' benefit.

As regards the contribution to the development of the internal market and the promotion of the interest of the citizens of the European Union, ARCEP outlines the low level of MTRs in France on 1 January 2012 as well as the fact that MTRs will further decrease to reach the pure BU-LRIC rate as of 1 January 2013.

ARCEP sets out that the level of MTRs proposed for the new entrants and the resulting average MTRs are lower than (i) the MTRs in place in the majority of the Member States as of 1 January 2012 as well as (ii) the MTRs in those Member States which already announced to set them on the basis of the recommended pure BU-LRIC model by 2013.

ARCEP also stresses that (i) new entrants' market share is very small, (ii) the international calls represent, on average, 10% of the traffic terminated by the French mobile operators, and (iii) the foreign operators do not differentiate their rates according to the network of an operator called. ARCEP considers that the present asymmetry would not lead foreign operators to reconsider their tariffs for calling French mobile numbers
from abroad.

Commission's Art. 7 Comments to Slovakian NRA on the latter's 2nd notification of WBA market review

The European Commission made the following comments in its decision addressed to the Slovakian NRA on the latter's wholesale broadband access market review:

"Need to ensure that divergent regulatory approaches to the nondiscrimination obligation do not create a barrier to the internal market

The Commission notes that the market for wholesale broadband access has been subject to price regulation for several years and that such regulation has not improved the level of competition on the relevant market in Slovakia. Hence, the Commission would like to underline that the proper enforcement of the nondiscrimination remedies could be of great importance to prevent any potential non-price related discriminatory behaviour of the incumbent operator. In view of the work currently undertaken by the Commission on the draft Recommendation on the application of a non-discrimination obligation, the Commission invites the TÚSR to review the details of the non-discrimination remedy once the Recommendation is published.

Need for a timely implementation of an appropriate costing methodology

The Commission notes that the TÚSR intends to notify the details of the proposed BU-LRAIC methodology some time in the future but does not specify any specific time. In view of the importance of an appropriate price control for wholesale broadband access services and the currently rather limited impact of regulation on competition, the Commission invites the TÚSR to finalise and notify the BULRAIC methodology for access services and for collocation services as soon as possible."

Commission consults on state aid de minimis Regulation

The European Commission, under the State Aid Modernisation programme, consults on the revission of the de minimis Regulation (see related page, and press release).

Moldova' s telecoms regulator consults on 4g license conditions

"The National Regulatory Agency for Electronic Communications and Information Technology (ANRCETI) has placed on its Web page for Public Consultations the Draft (doc. in state language) administrative Board Decision on approving special license conditions for the use of radio frequencies/channels in 2500-2690 MHz frequency band. The consultation will last through August 17, 2012, this being the deadline for providing recommendations to the document.

The draft document sets forth, pursuant to art. 24 paragraph (1) and (3) of the Law on Electronic Communications, the conditions for the use of radio frequencies in the 2500-2690 MHz band, 2500-2520/2620-2640 MHz; 2520-2540/2640-2660 MHz and 2540-2560/2660-2680 MHz sub-bands, of 40 MHz bandwidth, for the provision of public mobile terrestrial electronic communications networks and services with broadband radio access, in LTE (Long Term Evolution) standards, known as 4G services. The license conditions are integral part of the 4G license and contain requirements to be strictly observed by future license holders" (see related page).

New Cypriot Law on Data Protection enters into effect

The new Cypriot Law on Data Protection entered into effect. The Law updates the previous one, clarifying disputed issues and increases the penalties (see relevant page).

French Competition Authority clears acquisition of Direct 8 and Direct Star by Vivendi and Groupe Canal Plus subject to conditions

In view of the clearance of the acquisition of TPS and CanalSatellite by Vivendi Universal and Canal Plus (see older post), the French NCA has cleared  the acquisition of Direct 8 and Direct Star by Vivendi and Groupe Canal Plus, subject to conditions as well (see the press release).

OFCOM issues determination to give effect to Court of Appeals ruling on BT's 080 and 0845/70 calls termination charges

OFCOM issued a determination (see relevant page) to give effect to Court of Appeals ruling on BT's 080 (see relevant page) and 0845/70 (see relevant page) calls termination charges

OFCOM consults on BT's request for exemption from undertakings as regards certain high bandwith services

"1.1 On 22 September 2005 British Telecommunications plc ("BT") offered, and Ofcom accepted, a set of undertakings pursuant to section 154 of the Enterprise Act 2002 (the "Undertakings"). The Undertakings included mechanisms to allow BT and Ofcom to agree exemptions from the Undertakings. The objective of this Consultation is to seek views from interested parties on BT's revised request for an exemption from the Undertakings for certain high bandwidth fibre-based products. 

1.2 These services are currently supplied by Openreach to other Communications Providers (CPs) and BT's downstream divisions, on an Equivalence of Inputs (EoI) basis. High bandwidth fibre products are typically used to provide dedicated connections between two sites (for example, corporate sites) to satisfy the growing demand for high bandwidth applications such as data centre connectivity and very low latency financial applications, and to extend private networks. 

1.3 BT originally requested an exemption from the requirement in the Undertakings to provide high bandwidth (i.e. bandwidths above 1Gbit/s) Ethernet access services and optical spectrum access services in May 2011. We consulted on the original exemption request on 31 May 2011 proposing to grant a temporary exemption to Openreach. We did not perform a detailed market assessment but relied on information contained within the Business Connectivity Market Review (BCMR) conducted in 2008 (the BCMR 2008). Given that there were a number of stakeholders that opposed our proposal to grant the exemption in advance of the next BCMR and that we had recently commenced this work, we postponed making a decision on the exemption until the results of the new BCMR (the BCMR 2012) were available. 

1.4 We have now completed our provisional analysis for the BCMR 2012 and published a consultation on our proposals on 18 June 2012. This includes a detailed assessment of the competitive conditions in the supply of the services relevant to this exemption. 

1.5 The BCMR 2012 proposes that BT has significant market power (SMP) in the provision of these high bandwidth services in the UK excluding a geographic area defined as West, East and Central London Area (WECLA) and also excluding the Hull area. We refer to this market in the BCMR 2012 as the "wholesale market for multiple interface symmetric broadband origination in the UK excluding the Hull Area and the WECLA". 

1.6 BT has now submitted a revised exemption request (set out at Annex 4) for current and potential access and backhaul services above 1Gbit/s that is geographically limited to the markets in which BT does not have SMP. The BCMR 2012 has provisionally identified that this is the case in the WECLA and therefore we are consulting on an exemption that applies to these services in the WECLA only. 

1.7 BT has requested an exemption because it considers these services are supplied in a competitive market and that requiring Openreach to offer these services on an EoI basis restricts its flexibility to compete effectively to the detriment of itself, CPs and their end users. In the absence of EoI obligations, Openreach would be able to negotiate prices and contractual terms on a bespoke basis. 

1.8 We are consulting on whether to grant BT's revised exemption request and, if so, on the precise terms of that exemption. Having considered the proposals in the BCMR 2012 consultation that the market for relevant services within the WECLA is competitive with a choice of suppliers and that no CP has been found with SMP, our provisional conclusion is that this exemption is unlikely to have a significant impact on the ability of other CPs to compete in this market or on end-users. 

1.9 In addition, our provisional conclusion is that the exemption is unlikely to have an adverse impact on the overall operation of the Undertakings. However, we are proposing that the Equivalence of Access Office (EAO) will have an additional monitoring role to give added assurance that this exemption does not undermine the delivery of services on an EoI basis outside the WECLA. 

1.10 We remain of the view that the absence of a finding of SMP does not automatically relieve BT of its obligations under the Undertakings. The granting of an exemption requires careful consideration of the matters on a case-by-case basis and particularly whether the exemption may have an impact on the overall operation of the Undertakings. 

1.11 Given that the BCMR 2012 is still at consultation stage, we do not intend to make a final decision on whether or not to grant BT's revised exemption request until the BCMR 2012 has been completed. Our current intention is to publish the statement for this exemption at the same time as the BCMR 2012 statement. Should additional information come to light during the BCMR 2012 consultation that would significantly impact the substantive results of the analysis of the relevant markets, then we may need to revisit our proposals in relation to BT's exemption request" (see OFCOM's relevant page).

UK's ISPs sign voluntary open internet code of practice

"The companies have agreed to provide full and open internet access products as the norm, and not to use traffic management practices to restrict or block their customers’ use of competitors’ services.
A new process is also being established to allow content providers to raise potential cases of targeted discrimination with ISPs, and refer unresolved cases to the Broadband Stakeholder Group (BSG) who will share them with Government and communications watchdog Ofcom" (see DCMS relevant page).

Wednesday, 25 July 2012

OFCOM issues enforcement guidelines

OFCOM issued its enforcement guidelines.

"1.7 The Competition Group Investigations Team generally handles the following types of investigations:
• alleged anti-competitive conduct or agreements under competition law;
• compliance with regulatory conditions, where the complaint or concern is not about consumer protection (this includes investigations about numbering);
• compliance with undertakings given to Ofcom under Part 4 of the Enterprise Act;
• super-complaints made by a designated consumer body about a feature, or combination of features, of a market that is, or appears to be, significantly harming the interests of consumers; and
• compliance with conditions in Broadcasting Act licences relating to fair and effective competition.

French NCA issues decision clearing again acquisition of TPS and CanalSatellite by Vivendi Universal and Canal Plus under conditions

"On 23 July 2012 the Autorité de la concurrence cleared the acquisition of TPS and CanalSatellite's sole control by Vivendi Universal and Canal Plus, subject to compliance with injunctions ordered to restore sufficient competition in the pay TV markets.


The injunctions ordered
Movie rights
  • The order sets rules governing GCP's purchasing behaviour with respect to movie rights, in particular by limiting the duration of output deals to three years, requiring that GCP enter into separate agreements for different type of right (1st pay TV window, 2nd pay TV window, series, etc) and prohibiting output deals for French films (for more details see orders 1(a) to 1(e)).

  • In order to enable the Orange Cinema Series offer to exert actual competitive pressure, independently of GCP, GCP must divest its stake in Orange Cinema Series. Otherwise, GCP will have to adopt measures limiting its influence on Orange Cinema Series (see orders 2(a) to 2(c)).
Distribution of pay TV channels
  • GCP will have to guarantee clear rules governing the access of independent channels to distribution services by CanalSat (distribution of a minimum number of independent channels, distribution of any channel holding premium rights and drafting of a model distribution deal) (see orders 3(a) to 3(d) and 4(a) to 4 (b)).

  • GCP will have to allow alternative distributors, particularly the ISPs, to compete effectively with CanalSat for exclusive distribution deals (see orders 5(a) to 5(b)).

  • GCP will have to make all its own movie channels distributed in its CanalSat offer (Cine+ channels) available for third-party distributors (unbundling) (see orders 6(a) to 6(c)).

Video on demand (VOD) and subscription video on demand (SVOD) (see orders 7(a) to 7(c)).

  • Separate contracts must be entered into for the purchase of VOD and SVOD rights on a non-exclusive basis, and must not be combined with rights purchased for linear distribution on pay TV;

  • StudioCanal's VOD and SVOD rights must be offered to any interested operator;

  • No exclusive distribution deals for the benefit of GCP's VOD and SVOD offers on ISP platforms.

These injunctions are imposed for a period of five years. An independent trustee, approved by the Autorité, will be responsible for monitoring their implementation. At the end of the five-year period, the Autorité will review the competition situation in order to determine whether the injunctions should be kept in place. If market conditions have changed significantly, the parties will be able to request for the measures to be revised.
" (see the press release).

Commission opens in-depth inquiry on Trentino state aid fibre project

"The European Commission has opened an in-depth inquiry to investigate whether a joint venture between the Italian Province of Trento and the Italian telecommunications operator Telecom Italia to build a fibre infrastructure is in line with EU state aid rules. At this stage, the Commission has doubts whether the project is carried out on terms that a private player operating under market conditions would have accepted. The opening of an in-depth inquiry gives interested third parties an opportunity to comment on the measures under investigation. It does not prejudge the outcome of the investigation." (see the press release).

Tuesday, 24 July 2012

OFCOM's plans for 4g auction

"The largest ever auction of spectrum for mobile services in the UK is set to get under way by the end of 2012, Ofcom announced today, laying the path for next-generation 4G networks to be rolled out next year." (see press release).

This development comes after the conclusion of OFCOM's conultation, its decision (see relevant page) and the respective notice of Ofcom’s proposal to make regulations in connection with the award of 800 MHz and 2.6 GHz (see page).

Monday, 23 July 2012

Commission's Art. 7 Comments to PTS on the latter's proposed modification of remedy in mobile call termination market

The European Commission made the following comments in its decision addressed to PTS on the latter's proposed modification of remedy in mobile call termination market"

"Implementation of the Termination Rates Recommendation

The Commission welcomes the expressed intention of PTS to move to a pure LRIC cost-model which will ensure that MTRs in Sweden are symmetrical and based on the costs incurred by an efficient operator.

The Commission notes that PTS has not yet notified to the Commission any such cost model and has not determined the precise timing of the model's introduction. PTS has, however, indicated that the results of the model will be implemented by 1 July 2013 at the latest.

The Commission would like to remind PTS that the deadline for the implementation of the Termination Rates Recommendation is already before that date, i.e. on 1 January 2013, and would like to ask PTS to ensure that the transition scheme leads to full compliance with the Termination Rates Recommendation, i.e. that MTRs are implemented at cost-efficient, symmetric levels, by 1 January 2013."

Commission's Art. 7 Comments to Gibraltar's NRA on the latter's proposed remedies in the sms and voice call termination markets

The European Commission made the following comments, in its decision, addressed to Gibraltar's NRA on the latter's proposed remedies in the sms and voice call termination markets:

"Imposition of the price control mechanism and the need for efficient costoriented mobile termination rates

The Commission notes that, in line with the price regulation previously imposed on the other mobile operators in Gibraltar, the GRA proposes to set Eazitelecom's rates on the basis of an alternative methodology for setting MTRs, i.e. benchmarking instead of the cost methodologies recommended in the Termination Rates Recommendation. In the reply to the request for information the GRA explains that in order to be consistent with the obligations already imposed on the other MNOs, it has decided to impose the same glide-path based on a benchmarking methodology taking into account various factors such as the BEREC snapshot report covering the period July 2010 - January 2011 and the
level of termination rates in Gibraltar at the time.

The Commission reminds the GRA that in order to comply with Recommend 12 of the Termination Rates Recommendation any other methodology used must result in outcomes consistent with the Recommendation as of 1 January 2013.

Therefore, outcomes resulting from the application of an alternative methodology should not exceed the average of the termination rates set by those Member States which have implemented the recommended cost methodology as of 1 January 2013. Further to that, the rates used for benchmarking should represent the cost efficient target rates at the end of the respective glide paths, but not the rates at a certain point along the glide-path. Such an approach has also been recently
endorsed by BEREC.

The Commission has already recalled this principle by way of comments addressed to GRA in October 2011, and indicated that the proposed benchmark and the resulting rates set by the GRA for the two main MNOs (Gibtelecom and CTS) were not appropriate.

However, the Commission notes that the GRA has not modified its approach for setting MTRs in general and consequently the rates applicable to the new entrant Eazitelecom. GRA proposes to implement still the same methodology resulting in MTRs significantly above the average of MTRs set in Member States already implementing the pure BU-LRIC model, and this for a period extending well after January 2013, the deadline for implementing the Termination Rates Recommendation.

The Commission is mindful of the specific competitive circumstances arising in Gibraltar given the very small size of the market (around 32,500 mobile subscribers only) and of the limited resources of the GRA. Furthermore, the Commission understands that at the time when the GRA was setting its benchmarking methodology only a few Member States had already implemented a pure BU-LRIC model as recommended.

Finally, the Commission understands that introducing a more adequate methodology only for Eazitelecom, which is the operator subject to the presently notified draft measure, would create in practice an asymmetry between the MNOs active in Gibraltar. This could undermine regulatory certainty and have an important and possibly negative impact on the market's developments with the
ensuing negative impact on consumers.

However, the Commission underlines that, since the GRA has implemented its benchmarking methodology, several other Member States have implemented a pure BU-LRIC model and that the Commission has stated in a number of cases that the correct benchmarking methodology should reflect the target rates applicable in those Member States.

Against this background, and in order to bring more quickly the benefits of lower MTRs to consumers the Commission requests the GRA to revise its proposed benchmark and re-notify an adequate glide-path applicable to all MNOs including Eazitelecom before the end of 2012, so that cost efficient MTRs could be applied already as of 1 January 2013. The GRA may consider adopting interim measures for Gibtelecom and CTS before a revised glidepath is formally adopted.

Also, the Commission recalls that Article 7(5) of the Framework Directive imposes on NRAs the obligation to "take the utmost account" of the Commission's comments.

Furthermore, NRAs are bound to impose remedies that are appropriate within the meaning of Article 16(4) of the Framework Directive and justified in light of the objectives laid down in Article 8 of the Framework Directive, and, in particular, the objectives of promoting efficiency, competition and maximum user benefits pursuant to Article 8(2) of the Framework Directive and Article 13(2) of the
Access Directive.

The Commission therefore reminds the GRA that if it were to propose a new price remedy, which would deviate from EU law and the principles of the Termination Rates Recommendation, the Commission could proceed to opening a phase II investigation pursuant to Article 7a of the Framework Directive or any further procedural steps the Commission might want to take in order to ensure compliance with the above principles of EU law.

Need to impose a cost-orientation obligation in the SMS termination markets and to set a glide-path towards the cost-oriented price

The Commission notes that the GRA identifies competition problems in the SMS termination market in Gibraltar which are similar to those identified in the mobile termination markets. However, the GRA does not, in line with the NRA's previous decisions for Gibtelecom and CTS, propose imposing a cost-orientation obligation on Eazitelecom on the market for SMS termination.

The Commission reiterates the comments made in case GI/2011/1249. The three mobile operators in Gibraltar are monopolists for SMS termination on their networks and normally have both the ability and the incentive to raise termination rates above costs. Commercial agreements cannot normally address this potential market failure on termination markets. Therefore, as already outlined in previous cases, imposing cost orientation is the most appropriate means to address the competition problems in this market over the medium term. The Commission therefore asks the GRA to impose a glide-path, preferably aligned with the voice call termination glide-path in terms of price-cap reduction milestones, in order to reduce the current SMS termination rate towards the cost-oriented level.

Need to impose the same non-discrimination obligation on all MNOs

The Commission notes that the non-discrimination obligation is not phrased in the same way for Eazitelecom and for the other MNOs. The Commission stresses that no justification has been provided that would, a priori, explain a difference of treatment between the three mobile operators which have been found to have SMP on their networks and can similarly abuse their market powers. Against this background, the Commission calls on the GRA to ensuring the same level of nondiscrimination in order to achieve a consistent regulatory approach."

Commission's Art. 7 Comments to BNetZA on the latter's withdrawal of regulation in very high bandwith leased lines market

The European Commission made no comments to BNetZA on the latter's withdrawal of regulation in the wholesale terminating segments of leased lines market of bandwidths of above 155 Mbps for failing to meet the 'three-criteria test' (see decision).

Commission asks for clarifications by 4 MS on implementation of AVMS Directive

"The European Commission has written to Portugal, Slovenia, Finland (concerning the autonomous region of Åland) and the United Kingdom (concerning the British overseas territory Gibraltar) seeking information about their implementation of the Audiovisual Media Services (AVMS) Directive. The Commission has asked the responsible authorities to reply within 10 weeks. The fact-finding letters are part of the Commission's efforts to ensure that the national media laws of all Member States correctly implement all aspects of the AVMS rules. The requests for information do not imply that the Directive has been incorrectly implemented but simply that, at this stage, the Commission has some outstanding questions concerning their implementation of the Directive.

The Commission sent a first round of letters to 16 Member States in March 2011 (Belgium, Bulgaria, Czech Republic, Denmark, Finland, France, Greece, Ireland, Italy, Malta, The Netherlands, Romania, Spain, Sweden, Slovakia and the United Kingdom) and a second round of letters to further 8 Member States (Austria, Cyprus, Estonia, Germany, Hungary, Latvia, Lithuania and Luxemburg) in September 2011. Poland has only partially notified some measures to implement the AVMS Directive into its national law and is currently subject to an infringement procedure" (see the press release).

Commission consults on possible network and infromation security legislative initiative

"The European Commission is seeking the views of governments, businesses, citizens about their experiences and EU possible responses to cyber incidents which cause disruption to essential Network and Information Systems (NIS), including the internet.

The Commission has launched this consultation to help it prepare a legislative proposal on network and information security, which will be an important element of the upcoming EU strategy on Cyber security. Feedback received will help the Commission draw up an approach to possible future risk management and security breach reporting requirements that would affect businesses in particular. The consultation runs until 12 October 2012." (see the press release).

Commission consults on net neutrality

The European Commission launched its consultation as regards specific aspects of transparency, traffic management and switching in an Open Internet (see press release and related page).

Commission's Art. 7 Comments to EETT on the latter's review of mobile call termination market

The European Commission made the following comments, in its decision, addressed to EETT, as regards the latter's review of the mobile call termination market:

"Need for an appropriate price control ensuring that customers derive maximum benefits in terms of efficient cost-based termination rates

The Commission notes that EETT intends to develop a pure BU-LRIC cost model by the end of 2012, and that it proposes in the meantime to set the MTRs in Greece on the basis of a benchmarking method. Furthermore, the Commission notes that EETT confirmed that as soon as the model is completed and the resulting price defined, it will accordingly issue a decision updating the glide-path and the target pure BU-LRIC MTR, which is currently set to be achieved as of 1 April 2013.

The Commission points out that the purpose of Recital 22 and of Recommend 12 of the Termination Rates Recommendation is to enable NRAs, in case of limited resources, to come to a cost efficient rate without having to finalise a pure BULRIC model in a timely manner.

However, the Commission observes that the target MTR which EETT proposes on the basis of benchmarking is calculated on the basis of the pure BU-LRIC rates notified to the Commission without account being taken of the pure BULRIC MTRs being actually implemented in the Member States.

In this respect, the Commission invites EETT to verify whether the proposed benchmark rates actually correspond to the pure BU-LRIC rates set by the NRAs by way of final decisions in the respective Member States, and in case deviations are identified, to correct the benchmark rates as appropriate.

In order to bring more quickly the benefits of lower MTRs to the consumers, the Commission further asks EETT to modify its glide-path in such a way that it would lead already as of 1 January 2013, the implementation deadline foreseen in the Termination Rates Recommendation, to MTRs corresponding to pure BULRIC rates. In any case, the Commission invites EETT to finalise its own pure BU-LRIC model as soon as possible in 2012, so that it can be applied already as of 1 January 2013."

In view of the Commission's Comments, the Greek NRA adopted its decision (see decision and press release, in greek).

The MTRs glidepath is the following:

01/08/2012 - 
16/10/2012 - 
Proposed MTRs  (euro/minute) 4,95 3,60 2,30 1,01

In essence, EETT abandonned its suggestion to extend the glidepath till April 2013 and as regards the rate after 01/01/2013, it was reduced from the initially suggested one of 1,03€ to 1,01€ (see older post).

ITU's draft of the future of ITRs

ITU decided to make publicly accessible, the draft on the future of ITRs (see related page).

Maltese NRA issues decision on subscriber contracts

"This Decision addresses the manner in which undertakings are required to provide subscriber contracts for the provision of an electronic communications service/s, in line with Article 23 of the Electronic Communications (Regulation) Act (Cap.399) (ECRA).
The Decision addresses the following points:
1. agreement and conclusion of a contract;
2. form of a contract;
3. means by which the contracts should be made available to consumers; and
4. provisions that are legally required to be included in contracts related to electronic communications service/s." (see MCA's related page).

Thursday, 19 July 2012

Romanian NRA fines Romtelecom for not fulfilling license conditions in the 410-415/420-425 MHz frequency bands

"ANCOM applied a RON 200,000 fine to S.C. ROMTELECOM S.A. for not having fully observed the obligations under the mobile communications licence held in the 410-415/420-425 MHz frequency bands. According to the undertaken obligations, this operator was due to install and to operate 1,242 base stations by the end of the first phase. Nonetheless, the ANCOM controls revealed that only 788 base stations are installed" (see press release).

Commission sends Italia letter of formal notice on AGCOM's independence issue as regards unbundling of ancillary services

"The Commission decided today to send a letter of formal notice to Italy on the regulation of telecom markets and on the margin of discretion of the regulator (AGCOM).
Independence of national regulatory authorities is a fundamental principle of EU telecom rules. For instance, regulators should not seek or take instructions from any other body in relation to market regulation.

At stake is an amendment to Italian law, aiming at 'unbundling' the provision of wholesale network access by Telecom Italia from the activation or maintenance of lines i.e. the so called ancillary services. The law in question would prescribe one particular solution and thus pre-empt the discretion of AGCOM. According to the European Commission AGCOM should be able to address any potential competition issue independently.

The Commission points out that the Regulatory Framework aims at ensuring that the national regulatory authorities (NRA) have a broad discretion in order to be able to determine the need to regulate a market according to each situation on a case-by-case basis and that it is for the NRAs, and not the national legislatures, to balance the objectives referred to in Article 8 of the Framework Directive when defining and analysing a relevant market which may be susceptible to regulation.
" (see relevant page).

Wednesday, 18 July 2012

Commission's Art. 7 Comments to Danish NRA's reviews of WPNIA, WBA and Wholesale Terminating Segments of Leased Lines Markets

The European Commission, made the following comments, in its decision, addressed to DBA, on the latter's reviews of the Wholesale Physical Network Infrastrucure Access, Wholesale Broadband Access and Wholesale Terminating Segments of Leased Lines Markets:

"Scope of the access obligation: drop cables on the market for physical network infrastructure access

The Commission notes that DBA proposes to impose on TDC a specific obligation to further extend its fibre network, at the request of competing operators, by providing a connection between TDC's existing fibre infrastructure and the end-user's premises ("drop cables"). The obligation is limited to customer premises that are physically located no more than 30 meters from TDC's existing fibre access network, i.e. premises already "passed" by TDC's fibre network, but not connected to it.

The Commission notes that DBA justifies the necessity of the proposed remedy with the specific circumstances prevailing on the Danish market, namely the existence of a fibre network, which almost reaches the end users premises, and TDC's commercial decision to roll out the drop cables only for the purpose of connecting its own retail customers. The obligation to construct the drop cables enables alternative operators to provide fibre based broadband services on the same conditions as TDC. DBA considers that any less intrusive remedy, such as non-discrimination, transparency or specific migration rules would not be sufficient to address the competition problems identified (first mover advantages).

The Commission points out that the obligation to roll out the drop cables at the request of competing operators may be considered necessary and appropriate only in the absence of any other less intrusive measure, such as, for example, unbundled access to the fibre already built by the SMP operator, or the inability of the alternative operators to self supply, which prima facie do not seem to be possible alternatives in the specific circumstances of this case.

The Commission therefore invites DBA to provide in its final measure additional elements showing that an obligation to provide the drop cables is justified and proportionate, and in particular why other less intrusive remedies fail to address TDC's first mover advantage in an equally effective manner. In this respect, the Commission invites DBA to consider a planning mechanism, which would require TDC to consult alternative operators on the installation of drop cables prior to TDC securing a contract with end customers in a certain area.

Wholesale market for terminating segments of leased lines

The Commission notes that DBA proposes to lift the price control obligation in the high capacity segment with reference to the specific characteristics of the competition dynamics and the regulation in the upstream markets whilst it proposes to enforce the non-discrimination and transparency obligation imposed on TDC.

The Commission notes that an imposition and an enforcement of a detailed (and adequate) non-discrimination obligation can in certain circumstances lead to a situation where other remedies, such as price control, can be lifted.

It is on this basis that the Commission invites DBA to extend the transparency obligation relative to the obligation to publish SLAs and KPIs, which was proposed to be limited to the low capacity segment only, also to the high capacity segment, in order to monitor the compliance of TDC with the non-discrimination obligation.

The Commission invites DBA to consider giving guidance on which KPIs are considered to be crucial to monitor the compliance with the non-discrimination obligation, in particular covering the ordering, delivering and provisioning processes."

Greek regulator meets with operators trying to reach compromise in vdsl

EETT met with the incumbent, OTE, and alternative operators in order to reach to a compromise in vdsl. The regulator attempted to bring an agreement on OTE providing naked vdsl and on quality issues and the operators to accept OTE's retail vdsl product (see also EETT's press release and tovima.gr, in greek).

Consultancy delivers to the Commission paper on costing methodologies and incentives to invest in fibre

Consultancy delivers to the Commission paper on costing methodologies and incentives to invest in fibre.

One day before Athens' main analogue transmitter switches to digital transmission

On 20 July 2012, Athens' main analogue transmitter switches to digital transmission, which means that, in essence, almost half of Greece's population will switch permanently to DTV (see Ministerial Decision, in greek).

EDPS issues Opinion on Commission's Communication on a European Strategy for a Better Internet for Children

The European Data Protection Supervisor, issued its Opinion on the Commission's Communication on a European Strategy for a Better Internet for Children.

Comreg consults on its review of the markets in broadcasting transmission services

The Irish NRA launched its consultation on its review of the markets in broadcasting transmission services.

"2.14 In this market review, as summarised below, two distinct markets are defined:

1) Market A: the market for wholesale access to national terrestrial broadcast transmission services

2) Market B: the market for wholesale access to DTT multiplexing services

A competition assessment has been carried out on each market and ComReg‟s preliminary conclusion suggests that both markets warrant ex ante regulation. The 2009 Act takes prominence and ComReg proposes that the measures outlined in this consultation paper should complement the 2009 Act. ComReg proposes that in the upstream market, market A, access to the terrestrial transmission network should be provided by the SMP operator to national analogue radio broadcasters and multiplex operators (both terrestrial radio and television). Market B as defined, includes the provision of multiplex services over all potential DTT (i.e. television) multiplex platforms. Given the current market structure where RTÉ is the sole provider in market B; ComReg proposes measures which allow access to RTE‟s DTT multiplexing services by DTT broadcasters who are be designated under section 130 of the Broadcasting Act 2009."

BIPT consults on leased lines markets reviews

The Belgian NRA launched its consultation on its revews of the wholesale terminating segments of leased lines and retail leased lines markets (see related page).

Telekom Austria / Yesss! Merger moves to phase II

The Austrian Competition Authority opened phase II as regards the Telekom Austria / Yesss! merger (see the press release).

Tuesday, 17 July 2012

UK's Competition Commission issues Annual Report

UK's Competition Commission issued its Annual Report (see relevant page).

Commission's decision to accept extension of geographic scope of Lithuanian rural state aid broadband scheme available

The European Commission's decision to accept extension of geographic scope of Lithuanian rural state aid broadband scheme was made available.

Commission opens proceedings against Microsoft over possible non-compliance with 2009 browser choice commitments

"The European Commission has opened proceedings against Microsoft in order to investigate whether the company has failed to comply with its 2009 commitments to offer users a choice screen enabling them to easily choose their preferred web browser. 
On the basis of information it has received, the Commission believes that Microsoft may have failed to roll out the choice screen with Windows 7 Service Pack 1, which was released in February 2011. This is despite the fact that, in December 2011, Microsoft indicated in its annual compliance report to the Commission that it was in compliance with its commitments. From February 2011 until today, millions of Windows users in the EU may have not seen the choice screen. Microsoft has recently acknowledged that the choice screen was not displayed during that period" (see the press release).

Commission consults on risk capital state aid guidelines

"In the context of its state aid modernisation initiative (SAM) ..., the European Commission has launched a review of the risk capital guidelines amended on 01/12/2010, which outline the criteria for assessing the compatibility of public support measures in this field. The review starts with a public consultation, seeking stakeholders' views on the functioning of the guidelines since their adoption in 2006 and in particular on market developments concerning the supply of equity and debt finance to small and medium sized enterprises (SMEs). In light of the submissions received and its own experience in applying the guidelines, the Commission will propose revised draft guidelines in 2013, with a view to contributing to the objectives of the Europe 2020 strategy for a smart, sustainable and inclusive growth. Submissions can be made until 5 October 2012" (see press release and consultation's page).

Commission consults on state aid Procedural Regulation

The European Commission launched its consultation on the revision of the state aid Procedural Regulation (see press release and consultation's page).

Friday, 13 July 2012

Court decides in Joined Cases C‑55/11, C‑57/11 and C‑58/11

The CJEU delivered its decision as regards Joined Cases C‑55/11, C‑57/11 and C‑58/11. The operative part of its ruling reads as follows:

"1.      Article 13 of Directive 2002/20/EC of the European Parliament and of the Council of 7 March 2002 on the authorisation of electronic communications networks and services (Authorisation Directive) must be interpreted as precluding the imposition of a fee for the right to install facilities on, over or under public or private property on operating undertakings which, without being proprietors of those facilities, use them to provide mobile telephony services.
2.      Article 13 of Directive 2002/20 has direct effect and therefore it grants individuals the right to rely upon it before the national courts to dispute the application of a decision by the public authority that is incompatible with that article."

Wednesday, 11 July 2012

French Data Protection Authority issues Recommendation on Cloud Computing

CNIL has issued a Recommendation to companies using the Cloud (see relevante page).

UK Minister announces filter scheme to tackle harmful intereference to DTT reception by 4g services

"Hundreds of thousands of homes will receive help to prevent 4G services interfering with television signals.

In a letter to Ofcom, Communications Minister Ed Vaizey set out terms for the £180 million scheme to help householders, which was originally announced in February" (see older post).

"The letter - which follows an Ofcom consultation" (see older post) "on the issues for digital TV raised by the launch of 4G services - says help will be available for the 900,000 digital terrestrial television (DTT) homes which Ofcom estimate will be affected when 4G is introduced next year.
Most TV viewers will be able to solve any problems by fitting a filter, which will be provided free-of-charge by the assistance scheme. But for some homes, an engineer will need to fit the filter to a rooftop aerial. Mr Vaizey today confirmed that vouchers will be provided to eligible households to pay for the installation.

In a very limited number of cases where filters cannot improve the TV service, assistance would be provided to switch to free-to-view satellite or to cable TV. Extra support will also be offered to vulnerable consumers" (see DCMS press release).

Tuesday, 10 July 2012

Cypriot NRA consults on its review of the WBA market

OCECPR consults on its draft market review of the wholesale broadband access market (see the press release and the consultation's related page, in greek).

BEREC issues Guidelines on Wholesale Roaming Access and consults on decoupling method

BEREC has issued its Guidelines on Wholesal Roaming Access, under Art.1 of the new Roaming Regulation.

It has also launched a consultation to get assistance on giving advice to the Commisson, before the latter issues an Implementing Act on decoupling, as required by Art. 5 of the new Roaming Regulation.

Monday, 9 July 2012

AGCM accepts TI's commitments as regards tenders case

The Italian NCA accepted Telecom Italia's undertakings to provide suffiicient infromation to alternative operators so that they can too submit competitive offers in tenders (see press release and decision, in italian).

"The investigation was launched following the complaints received from Fastweb, which claims that Telecom Italia exploited its status as a vertically integrated operator in order to exclude Fastweb from the Consip and Enel tenders for fixed-line telephone services and IP connectivity. In specific, Telecom refused to supply technical-economic information that Fastweb deemed necessary for formulating its own offers" (see press release).

BNetzA withdraws objections to DT's vdsl bitstream price model

"The Bundesnetzagentur intends to withdraw the provisional prohibition it imposed in early April on Telekom Deutschland GmbH's (Telekom) new price model (known as the "contingent model") for marketing high-speed VDSL broadband line to competitors. The associated rates regulation proceedings will be discontinued. This step comes after Telekom made changes to its price model in response to the concerns the Bundesnetzagentur raised in its prohibition decision. The draft decision to lift the prohibition decision and the notification of the discontinuation of proceedings were today submitted to the European Commission and the regulatory authorities in the other EU Member States." (see the NRA's press release).

Thursday, 5 July 2012

CJEU's ruling in Content Services case

The Court states in th eoperative part of its judgment in case C-49/11:

"Article 5(1) of Directive 97/7/EC of the European Parliament and of the Council of 20 May 1997 on the protection of consumers in respect of distance contracts must be interpreted as meaning that a business practice consisting of making the information referred to in that provision accessible to the consumer only via a hyperlink on a website of the undertaking concerned does not meet the requirements of that provision, since that information is neither ‘given’ by that undertaking nor ‘received’ by the consumer, within the meaning of that provision, and a website such as that at issue in the main proceedings cannot be regarded as a ‘durable medium’ within the meaning of Article 5(1)."

CJEU's judgment in UsedSoft case

The Court states in the operative part of its ruling, in case C-128/11:


On those grounds, the Court (Grand Chamber) hereby rules:

1.      Article 4(2) of Directive 2009/24/EC of the European Parliament and of the Council of 23 April 2009 on the legal protection of computer programs must be interpreted as meaning that the right of distribution of a copy of a computer program is exhausted if the copyright holder who has authorised, even free of charge, the downloading of that copy from the internet onto a data carrier has also conferred, in return for payment of a fee intended to enable him to obtain a remuneration corresponding to the economic value of the copy of the work of which he is the proprietor, a right to use that copy for an unlimited period.

2.      Articles 4(2) and 5(1) of Directive 2009/24 must be interpreted as meaning that, in the event of the resale of a user licence entailing the resale of a copy of a computer program downloaded from the copyright holder’s website, that licence having originally been granted by that rightholder to the first acquirer for an unlimited period in return for payment of a fee intended to enable the rightholder to obtain a remuneration corresponding to the economic value of that copy of his work, the second acquirer of the licence, as well as any subsequent acquirer of it, will be able to rely on the exhaustion of the distribution right under Article 4(2) of that directive, and hence be regarded as lawful acquirers of a copy of a computer program within the meaning of Article 5(1) of that directive and benefit from the right of reproduction provided for in that provision."

Austria violated EU law over independence of data protection authority issue, advises AG Mazak

AG Mazak states as regards case C-614/10, in the conclusion of its opinion:

"46. Having regard to the foregoing, I propose that the Court should: ".

(1)      Declare that, first, by providing for the functions of managing member of the Datenschutzkommission and federal official to be held concurrently; second, by integrating the Datenschutzkommission office within the Federal Chancellery; and, third, by granting the Federal Chancellor a right to information concerning the Datenschutzkommission, thereby incorrectly transposing the requirement that the functions entrusted to supervisory authorities be exercised ‘with complete independence’, the Republic of Austria has failed to fulfil its obligations under the second subparagraph of Article 28(1) of Directive 95/46/EC of the European Parliament and of the Council of 24 October 1995 on the protection of individuals with regard to the processing of personal data and on the free movement of such data;


OFCOM consults on its draft leased lines charge control suggesting lowering of BT's wholesale prices

"Ofcom has today proposed controls on the wholesale prices BT charges for products using leased telecoms lines, which provide vital high-speed links for businesses and providers of superfast broadband and mobile services.

In the Business Connectivity Market Review1 published last month, Ofcom proposed that BT has significant market power in a number of wholesale leased line services, and that charge controls should be imposed in the relevant markets to protect purchasers of these products. The consultation published today identifies the proposed level for those price controls.

Ofcom expects the proposed controls will lead to real-terms price reductions for most customers of the £2bn leased lines market, such as businesses, schools, universities and libraries.

Consumer mobile and broadband operators, which use leased lines to transfer data on their networks, would also see savings which could be passed on to customers.

Ofcom is proposing overall caps linked to inflation (measured under the retail price index, or RPI), designed to align the prices of these BT products with their cost by 2015. This form of charge control also provides an incentive for BT to make efficiency gains.

These controls mainly relate to two groups of services (or ‘baskets’) which are provided by BT: legacy leased lines using “traditional interface” (TI) technology, and newer telecoms lines based on the faster Ethernet standard for sending data at very high speeds over networks.
  • For BT’s TI services, Ofcom is proposing an overall basket cap of between RPI + 0% and RPI + 6.5%, with a central estimate of RPI + 3.25%.
  • For BT’s Ethernet services, we are proposing an overall basket cap of between
    RPI − 8% and RPI − 16%, with a central estimate of RPI − 12%.
For low bandwidth Ethernet lines in west, east and central London, where BT faces greater competition from other providers, Ofcom is proposing a lighter form of price control – a safeguard cap on each relevant Ethernet service, ensuring that no prices can rise over the three-year period" (see the press release and related page).

Finnish Supreme Administrative Court rejects TeliaSonera's appeal on 1 Mb universal service obligation

"The Supreme Administrative Court has today rejected TeliaSonera's appeal on the Finnish Communications Regulatory Authority's (FICORA) decision obliging the operator to offer internet access services of 1 Mbit/s as universal service to consumer and corporate customers" (see the press release).

Cypriot NRA consults on co-location and facility sharing Decree

Cypriot NRA launched its consultation on the draft co-location and facility sharing Decree (in greek). The consultation will end up on 6 August 2012 (see the press release, in greek).

AGCM launches infringement proceedings against Apple

The Italian NRA launched infringement proceedings against Apple, owing to the latter, allegedly, not having complied with the Authority's earlier judgement on warranties (see decision).

Irish Data Protection Commissioner issues guidance on Cloud Computing

"The Data Protection Commissioner, Billy Hawkes has today published guidance on his website to assist any entity using or considering using a cloud computing solution to hold or manage the personal data for which they are responsible.  The Commissioner has published this guidance for Irish based entities on foot of guidance published at a European Level by the Article 29 Working Party (of which he is a member) today on Cloud Computing and recent useful guidance produced domestically by the National Standards Authority of Ireland (NSAI), in conjunction with the Irish Internet Association (IIA).

In summary, the guidance makes clear that the use of the cloud to store or handle personal data can be easily accommodated within Data Protection law once some simple steps are followed by any entity using such a service" (see the press release).

Art. 29WP issues Opinion on Cloud Computing

Art. 29WP issued its Opinion on Cloud Computing.

Norwegian regulator set to auction 2X45MHz in 2GHz band

"Norwegian Post and Telecommunications Authority (NPT) will award frequencies in the 2 GHz band (1920-1980 / 2110-2170 MHz) by auction. A total of 2 x 45 MHz is available and NPT has registered that demand exceeds supply for these frequencies" (see the press release).

Project bonds for ict infrastructure amongst other approved by EP

"200 million will be set aside to guarantee investments in transport networks, €20 million for information and communication technology (ICT) networks and €10 million for energy connections. The scheme will be managed by the European Investment Bank (EIB).


Project bonds will be introduced in 2012 and 2013 to pave the way for possible wider use under the "Connecting Europe Facility" at the start of the EU's new Multiannual Financial Framework (MFF) for 2014-2020. The idea is to test how the financial markets perceive them and to use the practical experience of the coming 18 months to fine-tune the initiative." (see the press release).

EP says final no to ACTA

The Europan Parliament rejected in final ACTA in its plenary meeting (see press release).

Commission clears the creation of a JV by KPN Group Belgium, De Persgroep and Roularta Media Group

"The European Commission has granted clearance under the EU Merger Regulation to the acquisition of joint control by the Belgian groups KPN Group Belgium, De Persgroep and Roularta Media Group, of the undertaking Hawaii NV, a newly created company constituting a joint venture. KPN GB is mainly active as a provider of mobile telephony services in Belgium, under its principal brand BASE. De Persgroep is a Belgian family-owned media company, active as newspaper and magazine publisher in Belgium and the Netherlands. Roularta is magazine publisher in Belgium, France, the Netherlands and Germany and owner of TV channels in Belgium. Hawaii NV is a platform provider of content and telecommunication services, offering mobile devices users access to mobile telecommunication and mobile content services. The operation was examined under the simplified merger review procedure" (see the Commission's midday express).

Tuesday, 3 July 2012

Commission's Art. 7 Comments to EETT on the latter's market reviews of leased lines markets

The European Commission, made the following comments, in its decision addressed to the Greek NRA, as regards the latter's reviews of the wholesale terminating and trunk segments and the retail leased lines markets:
"The existence of barriers to entry and the development of effective competition in the wholesale market for trunk segments

The market for trunk segments of leased lines was removed from the Recommendation on Relevant Markets, as – in general – entry barriers in this market are considered to be low. However according to the Explanatory note to the Recommendation: "Individual NRAs may be in a position to demonstrate that trunk segments of leased lines continue to fulfil the three criteria and are susceptible to ex ante regulation."

Section 2.2 of the Explanatory note to the Recommendation provides that an important qualification of the first criterion is whether high entry barriers are likely to be non-transitory in the context of a modified Greenfield approach (i.e. in the absence of regulation in the market concerned under this regulatory framework but including regulation which exists outside this framework). In this respect  the NRA concerned will, therefore, have to examine whether the industry has experienced entry and whether entry has been or is likely in the future to be sufficiently immediate and persistent to limit market power. Barriers to entry will also depend on the minimum efficient scale of output, and the fraction of costs which are sunk.

EETT's own analysis shows that considerable entry has taken place in the trunk market and that alternative operators have been able to increase significantly their market shares over the past years. At the same time EETT indicates that there is only a limited geographic presence of alternative operators and that due to the continued importance of point-to-point wholesale offers regulated access to terminating segments is not sufficient to reduce entry barriers such that the market for trunk segments would become effectively competitive or would tend towards effective competition over the period of this market review.

Additionally, EETT also claims that there are significant barriers for existing competitors who would want to shift additional traffic onto their networks, as this could require substantial infrastructure investments. Due to the uncertainties associated with the development of traditional interface services and the current unfavourable economic climate in Greece it seems that alternative operators are unwilling or unable to make such new investments.

The Commission would like to stress that in order to establish that the first criterion is met, NRAs have to demonstrate that barriers to entry are high, i.e. that market entry has not put sufficient constraint on the dominant undertaking's market power and that it is likely that the situation will not change in the timeframe of the review. In this regard NRAs also have to show that prices in the market are above the competitive level and are not expected to decrease within the timeframe of the review. On the basis of EETT's reasoning set out above the Commission does not contest EETT's conclusions on the existence of entry barriers. However, the Commission emphasises the need to keep future market developments, in particular concerning a potential further decrease in OTE's market shares under close review and urges EETT to undertake a further market review should additional changes occur within the timeframe of this review.

In addition, the Commission asks EETT to add further detail regarding the prices of trunk segments in its final measures, which can support EETT's conclusion by showing that such prices are above the competitive level and unlikely to decrease over the period of this market review.

Inefficiency of wholesale regulation 

According to Article 17 (1) (b) of the Universal Service Directive25 national regulatory authorities shall only impose regulatory obligations in a retail market where it is not effectively competitive and the wholesale remedies imposed would not result in the achievement of the regulatory objectives set out in Article 8 of the Framework Directive. Moreover, the retail leased lines market has been removed from the Recommendation, as – in general – with wholesale regulation in place, there should only be few barriers to entry into this market. The Explanatory Note to the Recommendation further clarifies that, with SMP regulation applied where it is warranted at the wholesale level, consumer harm is unlikely to occur on the retail leased lines market. Wholesale regulation, where appropriate, should be sufficient to ensure that there is competitive supply at the retail level. Firms can make tenders to provide a widely based leased line offer to the customer’s premises. Once the problem of making a ubiquitous offer has been overcome, then entry barriers into this market are no longer high.

The Commission notes that EETT's notification does not contain an explicit assessment as to why EETT considers additional retail regulation to be justified and appropriate in light of Article 17 of the Universal Service Directive. EETT, in response to the Commission's request for information, stated that the regulatory measures it imposed at the wholesale level are not yet adequate to sufficiently reduce barriers to entry and expansion to the extent that the three-criteria test for the retail market would no longer be fulfilled or the market would be effectively competitive. It, therefore, considers that given the deficient wholesale regulation and the shrinking nature of the retail leased lines market for lines up to and including 2Mbit/s, competitive conditions in this retail market in Greece are unlikely to improve over the next few years.

The Commission, therefore, asks EETT to demonstrate comprehensively in its final measure, why it considers that retail regulation, despite continued regulation of both trunk and terminating segments of leased lines, remains necessary in light of Article 17 (1) (b) of the Universal Service Directive.

In addition, the Commission urges EETT to enforce strictly its wholesale regulation and rigorously monitor market developments both at retail and at wholesale level. In this respect, (i) should EETT continue to consider that wholesale obligations prove to be ineffective, the Commission asks EETT to adjust them without undue delay; (ii) should wholesale obligations take full effect in the market, EETT is asked to withdraw retail regulation even before the end of the review period of the notified draft measure.

The need for price regulation at the retail level

Even if EETT, in its final measure, can demonstrate the need for continued regulation of the retail market for leased lines of up to and including 2 Mbps, the Commission questions the need and appropriateness for continued price regulation in this market. EETT justified the proposed imposition of such a remedy with the need to address the risk of excessive (or predatory) pricing by the dominant operator. However, EETT failed to address sufficiently the potential effects wholesale price regulation would have on the ability of the dominant operator to set prices independently of its competitors who should have access to cost oriented wholesale inputs. Even if one were to accept the presence of certain barriers to entry in the market, the availability of cost oriented wholesale inputs may serve as a constraint for the dominant operator to charge excessively high retail prices as it is likely to allow competitors to counter such pricing behaviour with their own retail products.

The Commission, therefore, asks EETT, to further justify in its final measure, in light of the above, the need for continued price regulation on the retail level or to amend its proposal by removing the obligation on OTE to charge retail leased lines up to and including 2 Mbps on a cost oriented basis."

OFCOM issues decision on the scope of PRS regulation

OFCOM issued its decision as regards the scope of Premium Rate Services regulation under which:

" - own portal services should be removed from the scope of PRS regulation; and

- PFI services should remain within PRS regulation but that we would ask PhonepayPlus ('PP+') to consider how it would regulate those services in a manner that takes into account the reduced potential for consumer harm in comparison with other forms of PRS." (see OFCOM's relevant page).

Romanian NRA calls for invitations as regards its 800, 900, 1800, 2600 MHz bands spectrum auctions

ANCOM has issued its call for invitations as regards its 800, 900, 1800, 2600 MHz bands spectrum auctions (see press release).

Commission approves acquisition of Cable & Wireless by Vodafone - UPDATE

"The European Commission has cleared the proposed acquisition of Cable & Wireless Worldwide Plc ("CWW") by Vodafone Group Plc under the EU Merger Regulation. Both companies provide fixed and mobile telecommunications services in the European Economic Area (EEA). The Commission concluded that the transaction would raise no competition concerns, as the parties' activities are largely complementary. CWW's main activity is related to fixed telecoms, whereas Vodafone is mainly active in mobile telecoms.

Vodafone and CWW's activities overlap in a number of markets in the fixed and mobile telecommunications markets in the UK. However, the Commission found that the impact of the transaction on these markets is likely to be small as the combined entity would continue to face significant competition from other market players post-transaction.

The transaction also gives rise to a number of vertical relationships in the fixed and mobile telecommunication markets mainly in the UK and Ireland. In particular, Vodafone would be able to use the assets of CWW in delivering fixed-mobile combined services to end-users. However, the Commission's investigation showed that the parties would not be able to shut out fixed or mobile operators from the markets for combined fixed-mobile services, because of the parties' lack of sufficient market power. Operators sell bundled fixed and mobile services via fixed or mobile resale agreements or partnerships and will still be able to do so in the future. With regard to Unified Communications ("UC") services, i.e. a set of products/services that provides a consistent unified user interface and user experience across multiple devices and media types, including fixed and mobile, there are many other competitors offering such services. Moreover, joint purchasing of mobile and fixed as one package has been the exception, rather than the rule, up to now. Finally, telecoms regulators have the possibility to, and also do intervene in some of the markets concerned and can therefore constrain the merged entity." (see the Commission's full press release).

UPDATE (24/07/2012): The decision was published.

Monday, 2 July 2012

Eircom desigated as universal service provider till 2014

ComReg "issued its decision to re-designate Eircom as the Universal Service Provider (USP) for a 2-year period to June 2014, following a public consultation" (see the media release).

German NRA objects changes to media merger control as envisaged in the proposed amendments of the GWB

"The Bundeskartellamt has today published its response to the government bill on the Eighth amendment to the GWB. It welcomes the bill and agrees to a large extent with the proposed amendments.

Andreas Mundt, President of the Bundeskartellamt, stated: "We welcome the changes to merger control and the clarification given on the areas of application of the GWB to the health insurance funds. However, we take a critical view of the changes to media merger control. In order to maintain journalistic diversity in the German press in the long term there should on no account be any further modifications in this area. We still see room for improvement in individual areas such as cartel prosecution and the monitoring of district heating and water suppliers in further stages of the legislative process.
" (see the full press release).

EDPS Opinion on Cybercrime Centre

The European Data Protection Supervisor issued its Opinion on the Commission's Communication on the establishment of a European Cyber Crime Centre, the main conclusion of which read as follows:

"50. The EDPS regards the fight against cybercrime as a cornerstone in building security and safety in the digital space and generating the required trust. The EDPS notes that compliance with data protection regimes should be regarded as an integral part of the fight against cybercrime and not as a deterrent of its effectiveness.

51. The Communication refers to the establishment of a new European Cybercrime Centre within Europol while a Europol Cybercrime Centre has already been in existence for a number of years. The EDPS would welcome if more clarity is provided concerning the new capacities and the activities that will distinguish the new EC3 from the existing Europol Cybercrime Centre.

52. The EDPS advises that the competences of the EC3 should be clearly defined and not just laid out by referring to the concept of "Computer Crime" included in current Europol's legislation. Also, the definition of the competences and data protection safeguards of the EC3 should be part of the review of the Europol legislation. Until the new Europol legislation becomes applicable, the EDPS recommends that the Commission sets forth such competences and data protection safeguards in the terms of reference for the Centre. These could include:
- a clear definition in which data processing tasks (in particular, investigations and operational support activities) the Centre's staff could be engaged, alone or in collaboration with joint investigation teams, and
- clear procedures that on the one hand ensure the respect of individual rights (including the right for data protection), and on the other hand provide guarantees that evidence has been lawfully obtained and can be used before a court.

53. The EDPS considers that the exchanges of personal data of the EC3 with the "widest array of public, private and open source actors" imply specific data protection risks as they will often involve the processing of data collected for commercial purposes and international data transfers. These risks are addressed by the current Europol Decision which establishes that, in general, Europol should not exchange data directly with the private sector, and with specific international organisations only in very concrete circumstances.

54. Against this background, and given the importance of these two activities for the EC3, the EDPS recommends that appropriate data protection safeguards should be provided in compliance with the existing provisions in the Europol Decision. These safeguards should be embedded in the terms of reference to be elaborated by the implementation team for the EC3 (and later in the revised Europol legal framework) and should in no event result in a lower level of data protection."

AG Mengozzi issues Opinion in France Telecom state aid case

AG Mengozzi advised in its Opinion (in french) the Court, as regards joined cases C-399/10 P and C-401/10 P, to annul the respective decisions on the General Court and refer back to it the questions of legallity of the alleged state aid received by France Telecom.