No C 269/30 Official Journal of the European Communities 14. 10. 91 
Opinion on the proposal for a Council Directive on the application of open network 
provision (ON?) to leased lines (*) 
(91/C 269/09) 
On 11 March 1991 the Council decided to consult the Economic and Social Committee, under 
Article 100 A of the Treaty establishing the European Community, on the abovementioned 
proposal. 
The Section for Transport and Communications, which was responsible for preparing the 
Committee's work on the subject, adopted its Opinion on 12 June 1991. The Rapporteur 
was Mr Noordwal. 
At its 288th plenary session (meeting of 3 July 1991) the Economic and Social Committee 
adopted the following Opinion by a substantial majority, with two dissenting votes and four 
abstentions. 
1. Introduction 
1.1. The creation of an open, common market for 
telecommunications services, particularly for value-
added services was established as a major policy goal 
by the Council of Ministers for Telecommunications in 
its Resolution of 30 June 1988. 
Consequently, on 28 June 1990 the Commission adopt­
ed the Directive on competition in the markets for 
telecommunications services and the Council of Minis­
ters for Telecommunications adopted a Council Direc­
tive on the establishment of the internal market for 
telecommunications services through the implemen­
tation of open network provision generally referred to 
as the ONP framework Directive which foresees as a 
first priority the adoption of a Council Directive which 
specifies open network provision conditions for leased 
lines. The Directive received broad support both in the 
European Parliament and in the Economic and Social 
Committee. 
1.2. Harmonization resulting in open and efficient 
access to and use of a fundamental part of telecommuni­
cations, namely leased lines, is essential for viable com­
petition in this market. 
The present proposal for a Council Directive takes 
account of the general principles which have been laid 
down in the Directives on competition in the market of 
telecommunications services and implements the ONP 
framework Directive. 
1.3. The proposal implements a concept of harmoni­
zation in the areas of standards, usage conditions, pro­
vision conditions and tariff principles. In order to achie­
ve a maximum harmonization for the user without at 
the same time introducing too many constraints on 
(!) OJ No C 58, 7. 3. 1991, p. 10. telecommunication organizations (TOs) and users, the 
proposal follows a dual approach: 
— The leased lines which are provided in the context 
of the establishment, development, and operation 
of the public telecommunications network shall be 
offered under Community-wide harmonization 
usage conditions and tariff principles. This will 
greatly facilitate the use of the present and future 
telecommunications infrastructure. 
— Certain types of leased lines shall be provided by 
the TOs in accordance with harmonized technical 
standards. The TOs shall be obliged to provide 
these leased lines, since these are needed and 
requested by the wide majority of European users 
of leased lines. The proposed Directive identifies 
four types of leased lines which have to be offered 
in all Member States by certain dates. 
2. General comments 
The Committee recognizes the urgent need for harmoni­
zation and common rules in this field and is therefore 
in general in favour of the Commission's proposal. 
However, the Committee does have the following com­
ments to the proposal in its present form: 
2.1. It is necessary to state that a network termin­
ation unit (NTU) is not claimed to be part of the leased 
line offering. Allowing the TOs to 'bundle' digital ter­
mination units within the networks would have serious 
implications for users in terms of both price and quality. 
Reliance on the typical NTUs supplied by a TO would 
therefore deprive Community users of a capability to 
manage their own network. 
There is a need for TO's to conduct remote testing in 
order to ensure network operations and management. 
Thus NTU's which are competitively supplied should 
be able to respond to both user and network initiated 
loop-back commands. 
14. 10. 91 Official Journal of the European Communities No C 269/31 
The European Telecommunication Standards Institute 
(ETSI) should be asked to establish the standards for 
the relevant interfaces and protocols. 
2.2. The principle of non-discrimination between 
competitive service providers and the TO's own com­
petitive activities appears to be accepted in principle. 
However, the concept of equivalent transmission 
capacity presents a serious risk that the TOs may be 
able to avoid this principle. 
The proposal defines Equivalent Transmission 
Capacity (ETC) as transmission capacity used by TOs 
competitive activities and which is not 'provided to 
other users'. This definition makes it clear that the word 
'equivalent' in fact must be interpreted as 'different' 
and this concept of ETC is thus contradictory to the 
principle of non-discrimination and weakens the Direc­
tive. The Commission should not accept arguments 
that fixed transmission capacity, when used by TOs 
competitive activities is different by the fact that it is 
used by a TO on TO premises. 
Furthermore the directive does not explicitly address 
the cases where competitive and reserved services are 
integrated using the same transmission capacity. The 
concept of ETC should be clarified in order to address 
these situations. 
With the suggested definition ETC may become a sour­
ce of discrimination concerning tariffs, usage and sup­
ply condition. The provisions for ETC should be rede­
fined to make them fully transparent or else deleted. 
2.3. The artificially high price for 2Mbit/s lines cre­
ates artificially high market pressure for intermediate 
speeds between 64Kbit/s and 2Mbit/s. The Commission 
should consider the addition of intermediate speeds 
between 64Kbit/s and 2Mbit/s, especially if competitive 
provision throughout the EEC does not occur and the 
prices for 2Mbit/s remain at the present, artificially 
high level. 
Furthermore the addition of a harmonized 34Mbit/s 
digital line to be available in the 1991 time frame is 
recommended. This would allow the TOs as well as 
private companies to base their network planning on 
the assumption of such availability. 
2.4. In the context of leased lines it is questionable 
if the data protection requirement could be interpreted 
to mean that TOs would have a right to challenge the 
usage of a leased line in relation to data privacy laws. 
The enforcement of a data privacy law is not a mission 
for a commercial undertaking, in particular a commer­cial undertaking that has a complex competitive 
relationship with many of its customers. At most, the 
TO should have an obligation to implement a court 
order for access restriction. 
2.5. The proposed directive leaves the formulation 
of the supply conditions to the TOs. There is a risk 
that 12 or more very different supply conditions could 
exists in the EEC. 
It should be stated in the directive that supply con­
ditions may not differ too widely between Member 
States. National regulatory authorities should establish 
supply conditions with maximum delivery periods, 
maximum repair time, minimum contractual periods. 
National regulatory authorities should try to resolve 
inequalities in supply conditions as far as possible either 
via the ONP Committee or bilaterally without harmoni­
zation at the lowest common denominator. 
2.6. The pricing of international leased lines should 
follow the same principles as for national leased lines. 
The price of an international leased line should result 
from the cost involved (type, distance). Only as far as 
crossing a frontier results in additional costs may these 
be reflected in the price of the international leased line. 
3. Specific comments 
Preamble 
The last indent of the preamble states that the Directive 
does not apply to leased lines of which one NTP is 
situated outside the Community. The Committee 
wishes to see as soon as possible comparable principle 
applied to leased lines which terminate outside the 
Community. The Commission is asked to establish 
multilateral or bilateral agreements in order to make 
extra community leased lines on comparable conditions 
available to users. 
Article 2 
Add to the second indent a definition of a leased line, 
along the lines of definition in Article 5b, last para­
graph. 
It should be made clear that leased lines give access 
to basic transparent transmission facility through the 
network for a given communication capacity between 
network termination points, in a unstructured mode 
where no channel allocations are forbidden or pre-
No C 269/32 Official Journal of the European Communities 14. 10. 91 
scribed, and without restrictions on use of bandwidth 
or capacity. 
Article 4.2 
Under certain circumstances, the advance period of 2 
months may not be sufficient. 
Article 5 
In indent d) a reference to the proposed Umbrella 
Directive would seem more appropriate. 
Article 6.3 
In the process of revision of Annex 2 the Commission 
should take the opinions of the interest groups fully 
into account. Additions and deletions of types of leased 
lines in the Annex should follow market demand. 
Article 7 
Some Member States have not yet established the separ­
ation between the national regulatory authorities and 
the TOs as laid down in the Directive on the Compe­
tition in Telecommunications Services (OJ No L 192, 
24 July 1990). The Committee urges the Commission to 
ensure that this separation is established in the Member 
States. 
Article 9 
Add to lc: 
'This hypothetical mid-circuit point shall be defined 
so that it will not increase the total cost of the leased 
line relative to comparable leased line offerings pro­
vided by one telecommunications organization.' 
Done at Brussels, 3 July 1991. Article 10 
In order to promote competitive services the Com­
mission should make the information contained in the 
summary reports available to users. 
Annex 2 
The minimum set of leased lines with Common Techni­
cal Characteristics is somewhat ambiguous. It should 
be clarified that G.703 should be interpreted as an 
interface with no further protocol restrictions. The user 
should be able to use the transmission capacity defined 
by the interface in a fully transparent manner. The 
inclusion of the expression '4 wired digital line' in the 
specification would clarify the matter. 
The terminology should leave no room for misunder­
standing. F.i. the reference to 2 Mbit/s should be 
2,048 Mbit/s. 
The footnote reference to X.21 should be clarified by: 
1. Defining the maximum length of the transition 
period. 
2. Confirming that TOs have to publish their interface, 
so allowing competitive provision of the appropri­
ate DCEs. 
3. Explicitly stating that 2,048 Mbit/s lines should be 
provided immediately. (There is no justification for 
a transition period for 2,048 Mbit/s lines.) 
34.Mbit/s digital lines should be included in the Annex. 
They should be available before the end of 1991. 
The Chairman 
of the Economic and Social Committee 
Fran?ois STAEDELIN