OPINION OF ADVOCATE GENERAL

CRUZ VILLALÓN

delivered on 9 July 2015 ( )

Case C‑326/14

Verein für Konsumenteninformation

v

A1 Telekom Austria AG

(Reference for a preliminary ruling from the Oberster Gerichtshof (Austria))

(Directive 2002/22/EC — Users’ rights relating to electronic communications networks and services — Right of subscribers to terminate their contracts without penalty — Extraordinary right to terminate — Alteration of charges under the terms of the contract — Linking of charges to a consumer price index — Inter-relationship with Directive 93/13/EEC)

1. This question, referred for a preliminary ruling in proceedings between a consumer protection association and a telecommunications company, concerns specific contractual terms that allow charges for telecommunications services to be adjusted to a consumer price index. In particular, the question under discussion is whether Article 20(2) of Directive 2002/22/EC of the European Parliament and of the Council of 7 March 2002 on universal service and users’ rights relating to electronic communications networks and services (‘Universal Service Directive’), ( ) means that subscribers have a right to terminate the contract without penalty if such adjustments to the charges are notified in accordance with the indexation method provided for in the contract.

2. Although the question referred for a preliminary ruling by the Oberster Gerichtshof refers exclusively to the Universal Service Directive, both the statement of reasons of the order for reference and the written and oral observations presented in this case reveal the necessity of taking into consideration also the provisions of Council Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts. ( )

3. This matter gives the Court of Justice the opportunity for the first time of ruling on the problem raised by a term providing for prices to be adjusted according to an index in relation to the users’ extraordinary right to terminate. If certain contractual terms relating to price changes have been examined by this Court, the terms previously analysed and the problems raised in those cases were not the same as those that are the subject-matter of this dispute. Thus, on the one hand, Invitel ( ) concerned the interpretation of Directive 93/13 in a case regarding a clause which provided for the unilateral amendment of costs related to the services supplied, which neither expressly described the method for fixing those costs nor specified the reasons for the amendment. In RWE Vertrieb, ( ) on the other hand, the argument was whether a contractual term which, although it provided that customers could terminate the contract, allowed a supplier to vary the cost of the gas supply unilaterally, without indicating the cause, conditions or implications of the change, met the requirements of good faith, balance and transparency laid down by Directives 93/13 and 2003/55. ( ) Finally, in Schulz and Egbringhoff, ( ) in which Directive 93/13 was not applicable, but only Directives 2003/54 ( ) and 2003/55, it was debated whether specific terms which, although they guaranteed information concerning price increases within a reasonable time and the right to terminate the contract, did not contain the reasons, preconditions and scope of a price change, satisfied the level of transparency required by those provisions.

I – Legislative framework

A – EU law

4. Recital 30 in the preamble to the Universal Service Directive establishes that ‘[c]ontracts are an important tool for users and consumers to ensure a minimum level of transparency of information and legal security. Most service providers in a competitive environment will conclude contracts with their customers for reasons of commercial desirability. In addition to the provisions of this Directive, the requirements of existing Community consumer protection legislation relating to contracts, in particular … Directive 93/13/EEC … and Directive 97/7/EC … apply to consumer transactions relating to electronic networks and services. Specifically, consumers should enjoy a minimum level of legal certainty in respect of their contractual relations with their direct telephone service provider, such that the contractual terms, conditions, quality of service, condition for termination of the contract and the service, compensation measures and dispute resolution are specified in their contracts. Where service providers other than direct telephone service providers conclude contracts with consumers, the same information should be included in those contracts as well. The measures to ensure transparency on prices, tariffs, terms and conditions will increase the ability of consumers to optimise their choices and thus to benefit fully from competition’.

5. Moreover, recital 49 in the preamble to the Universal Service Directive establishes that the Directive ‘… should provide for elements of consumer protection, including clear contract terms and dispute resolution, and tariff transparency for consumers’.

6. Article 1 of the Universal Service Directive, which is designed to set out the aims and scope of the Directive, is worded as follows:

‘1. Within the framework of Directive 2002/21/EC (Framework Directive), this Directive concerns the provision of electronic communications networks and services to end-users. The aim is to ensure the availability throughout the Community of good-quality publicly available services through effective competition and choice and to deal with circumstances in which the needs of end-users are not satisfactorily met by the market. The Directive also includes provisions concerning certain aspects of terminal equipment, including provisions intended to facilitate access for disabled end-users.

2. This Directive establishes the rights of end-users and the corresponding obligations of undertakings providing publicly available electronic communications networks and services. With regard to ensuring provision of universal service within an environment of open and competitive markets, this Directive defines the minimum set of services of specified quality to which all end-users have access, at an affordable price in the light of specific national conditions, without distorting competition. This Directive also sets out obligations with regard to the provision of certain mandatory services.

…

4. The provisions of this Directive concerning end-users’ rights shall apply without prejudice to Community rules on consumer protection, in particular Directives 93/13/EEC and 97/7/EC, and national rules in conformity with Community law.’

7. Chapter IV of the Universal Service Directive is devoted to the protection of end-user interests and rights. In that chapter, Article 20 of the Directive provides:

‘1. Member States shall ensure that, when subscribing to services providing connection to a public communications network and/or publicly available electronic communications services, consumers, and other end-users so requesting, have a right to a contract with an undertaking or undertakings providing such connection and/or services. The contract shall specify in a clear, comprehensive and easily accessible form at least:

…

d) details of prices and tariffs, the means by which up-to-date information on all applicable tariffs and maintenance charges may be obtained, payment methods offered and any differences in costs due to payment method;

…

2. Member States shall ensure that subscribers have a right to withdraw from their contract without penalty upon notice of modification to the contractual conditions proposed by the undertakings providing electronic communications networks and/or services. Subscribers shall be given adequate notice, not shorter than one month, of any such modification, and shall be informed at the same time of their right to withdraw, without penalty, from their contract if they do not accept the new conditions. Member States shall ensure that national regulatory authorities are able to specify the format of such notifications.’

8. Recital 27 in the preamble to Directive 2009/136, which amends the Universal Service Directive, states that ‘the right of subscribers to withdraw from their contracts without penalty refers to modifications in contractual conditions which are imposed by the providers of electronic communications networks and/or services’.

9. Article 3 of Directive 93/13 provides:

‘1. A contractual term which has not been individually negotiated shall be regarded as unfair if, contrary to the requirement of good faith, it causes a significant imbalance in the parties’ rights and obligations arising under the contract, to the detriment of the consumer.

…

3. The Annex shall contain an indicative and non-exhaustive list of the terms which may be regarded as unfair.’

10. Point 1 of the Annex to Directive 93/13 lists among the terms mentioned in Article 3(3) of the Directive terms which have the object or effect of:

‘…

j) enabling the seller or supplier to alter the terms of the contract unilaterally without a valid reason which is specified in the contract;

…

l) providing for the price of goods to be determined at the time of delivery or allowing a seller of goods or supplier of services to increase their price without in both cases giving the consumer the corresponding right to cancel the contract if the final price is too high in relation to the price agreed when the contract was concluded;

…’

11. In relation to the scope of point 1(j) and (l) of the Annex to Directive 93/13, point 2 of that Annex provides:

‘…

b) …

Subparagraph (j) is also without hindrance to terms under which a seller or supplier reserves the right to alter unilaterally the conditions of a contract of indeterminate duration, provided that he is required to inform the consumer with reasonable notice and that the consumer is free to dissolve the contract.

…

d) Subparagraph (l) is without hindrance to price-indexation clauses, where lawful, provided that the method by which prices vary is explicitly described.’

B – Austrian law

12. Paragraphs 25 and 25a in Section III of the Telekommunikationsgesetz 2003 (Telecommunications Law) ( ) read as follows:

‘Paragraph 25

1. Operators of communications networks or services shall adopt general terms and conditions of business describing, inter alia, the services offered, and lay down the charging regime applicable to those services ...

2. Before they come into effect, changes to the general terms and conditions of business and the charging regime shall be notified to the regulatory authority and announced in an appropriate manner. Changes that do not operate exclusively to the benefit of the subscriber must be announced and notified at least two months in advance. The provisions of the Konsumentenschutzgesetz … (KSchG) and of the Allgemeines Bürgerliches Gesetzbuch (General Civil Code) shall otherwise remain unaffected.

3. The substance of changes that do not operate exclusively to the benefit of the subscriber shall be notified to him in writing, for example by being printed on a periodic statement of account, not less than one month before the change comes into effect. At the same time, the subscriber shall be alerted to the point in time at which the changes are to come into effect and to the fact that he is entitled to terminate the contract at no cost up until that time. … Changes to the general terms and conditions of business and charging regimes applied by operators of communications networks and services which become necessary following an order adopted by the regulatory authority on the basis of this provision and which do not operate exclusively to the benefit of users shall not entitle the subscriber to terminate the contract at no cost ...

5. Charging regimes shall, as a minimum, contain:

…

2. an indication of the means by which up-to-date information on all applicable tariffs and maintenance charges may be obtained,

…’

13. Paragraph 6 of the Konsumentenschutzgesetz (Consumer Protection Law), ( ) contains the following provisions:

‘Paragraph 6 Unlawful contract terms

I. In no circumstances shall the consumer be bound by, in particular, contract terms, within the meaning of Paragraph 879 of the ABGB (General Civil Code), under which

…

5. the trader is entitled, at his request, to apply in respect of the service which he provides a charge higher than that which was determined at the time when the contract was concluded, unless the contract also provides for a reduction in the charge if the agreed conditions governing changes to charges are satisfied, the circumstances triggering the change to the charge are set out and objectively justified in the contract, and the change is outside the trader’s control …’

14. The Bundesstatistikgesetz 2000 (Law on Federal Statistics) ( ) establishes, in Paragraph 22 et seq., the federal institution ‘Statistik Österreich’, which is responsible for, inter alia, compiling and publishing statistics. This institution is responsible for compiling the consumer price index.

II – Facts and procedure in the main proceedings

15. The Verein für Konsumenteninformation (Consumer Information Association) has brought a collective action for an injunction against A1 Telekom Austria AG, seeking an order that that company should make no further use of, and refrain from enforcing, certain clauses in the general terms and conditions of business which it applies in the course of trade with consumers, which provide for the charges for telecommunications services to be adjusted according to the fluctuation of a consumer price index. ( )

16. The applicant’s claims were upheld in full in the judgment at first instance. An unsuccessful appeal was brought against that judgment by A1 Telekom. The appellate court considered, in particular, that, in so far as the defendant is entitled to make unilateral changes to the charging regime, subscribers also have an extraordinary right to terminate.

17. This question referred for a preliminary ruling is raised in connection with the appeal on a point of law brought by A1 Telekom Austria against the judgment on appeal. The appeal on a point of law was declared admissible by the Oberster Gerichtshof, the referring court, in the light of the opposing criteria followed by different Divisions of the appellate court in this regard. Another Division of the appellate court had taken the view that the protective purpose of Paragraph 25 of the TKG does not cover adjustments to charges based on a previously agreed index, since such price-adjustment clauses are sufficiently determined and are not within the control of the telecommunications company.

III – The question referred for a preliminary ruling and procedure before the Court of Justice

18. In those circumstances the Oberster Gerichtshof has referred the following question for a preliminary ruling:

‘Is the right, provided for in Article 20(2) of the Universal Service Directive, for subscribers to withdraw from their contracts without penalty ‘upon notice of modifications in the contractual conditions’ also to be provided for in the case where an adjustment to charges derives from contractual conditions which, from the time when the contract is first concluded, provide that future charges are to be adjusted (upwards or downwards) in accordance with changes in an objective consumer price index reflecting movements in the value of money? ’

19. Written observations have been presented in the proceedings before the Court of Justice by the Verein für Konsumenteninformation, A1 Telekom Austria, the European Commission and the Belgian Government, all of which, with the exception of the last, appeared at the hearing held on 30 April 2015.

IV – The question referred for a preliminary ruling

A – Observations presented before the Court of Justice

20. The Verein für Konsumenteninformation denies, in the first place, that the suppliers of telecommunication services have a right to amend the contractual terms under Article 20 (2) of the Universal Service Directive, which does, on the other hand, affirm the right of the consumer to terminate the contract. As the association pointed out at the hearing, it would be contrary to the Directive’s objective of maintaining affordable access to the service if there were to be no such right. In the second place, the right to terminate exists precisely for those cases in which that opportunity for making unilateral changes is provided for contractually, for, failing such a previous agreement, the operator could not make those changes. If the interpretation proposed by A1 Telekom Austria is followed, the right to terminate could be systematically avoided through the introduction of indexation clauses. Furthermore, the indexation proposed is not automatic, but depends on the operator deciding to inform the consumer that it intends to raise charges. The association also refers to the judgement in RWE Vertrieb, ( ) in support of its argument that a clause which allows a change in charges constitutes a modification in the contractual conditions, within the meaning of the second sentence of Paragraph 2 (b) of the Annex to Directive 93/13 and of Annex A (b) of Directive 2003/55. As the association declared at the hearing, Directives 93/13 and 2002/22 are different in scope, so that the extraordinary right to terminate contemplated in the latter would apply in any case, irrespective of whether the indexation clauses are unfair or not. Nor, in addition, is the use of the consumer price index justified from a substantive point of view, for that index does not reflect the constant movement of prices downwards in the telecommunications sector. As was pointed out at the hearing, the relative weight of communications in the body of prices taken into consideration in order to draw up the index is very low (2.2%) Finally, the association refers to the case-law of the Oberster Gerichtshof, which has interpreted the national legislation transposing Article 44 (1) of Directive 2007/64 ( ) to the effect that price changes resulting from clauses other than adjustments of interest rates in accordance with what has been agreed must be regarded as included within the concept of a contractual modification. ( )

21. According to A1 Telekom Austria, a price change resulting from the application of indexation clauses does not constitute a contractual modification, but the ordinary performance of the contract. The aim of indexation, in this respect, is to compensate for future monetary erosion and to maintain equivalence between the material obligations and the financial obligations agreed between the parties. Accordingly, there being no amendment of the contract, Paragraph 25 of the Telekommunikationsgesetz, laying down the consumer’s right to terminate, is not applicable. Moreover, such price changes are in accordance with Paragraph 6(1)(5) of the consumer protection law. Furthermore, A1 Telekom Austria considers that a price adjustment made on the basis of an indexation clause does not constitute a modification actively imposed by the service supplier, within the meaning of recital 27 in the preamble to Directive 2009/136, which amends the Universal Service Directive, but is the performance of an agreed contractual provision, and that the circumstances leading to a price adjustment are independent of the operator’s will. Consequently, an adjustment to the consumer price index such as that in the main proceedings does not fall within the scope of Article 20(2) of the Universal Service Directive. A1 Telekom Austria also alludes to point 2(d) of the Annex to Directive 93/13, according to which lawful price-indexation clauses explicitly describing the method by which prices are to vary are not unfair. The reference to Article 44 of Directive 2007/64 on payment services, which is found in the order for reference, is, on the contrary, irrelevant, since that provision governs different contractual relations. Nor does point 1(b) of Annex I to Directive 2009/73 support any conclusion regarding the term ‘modification’ in the case with which we are concerned. Similarly, A1 Telekom Austria pointed out at the hearing that the criterion of affordability, within the meaning of Article 3(1) of the Universal Service Directive, applies strictly in relation to Chapter II of that Directive, devoted to universal service obligations, and cannot be used to interpret Article 20 of the Directive. Finally, A1 Telekom Austria also explained at the hearing that most of the contracts in which the clause at issue is inserted are contracts of indeterminate duration that may be terminated without penalty if one month’s notice is given and that fixed-term contracts under which a penalty would indeed be imposed on the subscriber for early termination have a minimum term of two years at most.

22. The Belgian Government, for its part, considers that an adjustment of prices arising under the general terms of the contract, such as that which is the subject-matter of the main proceedings, gives rise to the subscribers’ right to terminate. Paragraph 2(d) of the Annex to Directive 93/13 and Article 20(2) of the Universal Service Directive are different in scope, for which reason they must be applied accumulatively. This interpretation was confirmed, according to the Belgian Government, by the judgments of the Court of Justice in Invitel and RWE Vertrieb. ( ) Moreover, indexation should be regarded as a modification imposed by the telecommunications operator, within the meaning of recital 27 of Directive 2009/136. Finally, the Belgian Government alludes to several studies which show the downward trend of communication prices, and therefore maintains that indexation cannot be considered necessary to maintain equivalence of obligations.

23. The European Commission considers that the right to terminate must not apply in relation to indexation clauses, for the resulting price changes do not constitute a modification in the contractual conditions within the meaning of Article 20(2) of the Universal Service Directive: the adjustment of charges on the basis of an agreed index and in accordance with the rules established was known at the time the contract was concluded, and therefore constitutes the application of one of the contractual terms, which has not been modified. Furthermore, from the moment it is concluded, the contract establishes the rules for varying charges in a transparent and detailed manner, linking them to an index compiled by a third body (Statistik Austria), on the basis of the objective fluctuation of the value of money. Moreover, the Commission points out that this interpretation is also in accordance with the rules of Directive 93/13. At the hearing, the Commission also emphasised that, irrespective of the different scopes of Directive 93/13 and the Universal Service Directive, both Directives may apply in a case such as this one. It also touched on the difference between the circumstances of the present case and those of Invitel and RWE Vertrieb, ( ) which were concerned with unfair terms that must give rise to a right to terminate. Finally, the Commission considers that the reference made by the referring court to Directive 2007/64 on payment services is irrelevant.

B – Analysis

24. By the question it has referred for a preliminary ruling, the Oberster Gerichtshof seeks to ascertain, in essence, whether an adjustment made to the charges for telecommunications services according to a consumer price index constitutes a modification in the contractual conditions, within the meaning of Article 20(2) of the Universal Service Directive, thus giving rise to the right of subscribers to terminate the contract without penalty. The reply to this question depends, therefore, on the interpretation of the expression ‘modifications in the contractual conditions’ inserted in that provision.

25. In this context, it is necessary to examine the particular function of indexation in long-term contracts and contracts of indeterminate duration. Consumer price indices, in their various formulations, are index numbers which measure the proportionate or percentage changes over time in the prices of certain goods and services that households consume. ( ) Indexation is a procedure whereby the monetary values of certain payments is adjusted to a consumer price index (CPI). ( ) Although the primary function of indexation has generally been linked to the maintenance of purchasing power or standard of living, ( ) applying to salaries or to certain Social Security benefits, the publication and regular nature of consumer price indices, as well as the fact that they are generally considered to be indicators of inflation, ( ) lead to them also being used as a reference, failing any other more suitable indices, for the adjustment of payment obligations in certain long-term contracts or contracts of indeterminate duration, with the aim of compensating losses in monetary value arising from general inflation. ( ) Accordingly, in contract law, price adjustment clauses containing a reference to a consumer price index are generally considered to be a remedy, albeit imperfect, ( ) for monetary instability, restoring balance between obligations. ( )

26. Having made these points of a preliminary nature in the light of the questions raised by the observations presented before the Court of Justice, I think it necessary to clarify, first of all, the questions arising from the inter-relationship between the Universal Service Directive and Directive 93/13. It should be borne in mind that the latter contains specific references both to price modification clauses which refer to an index and to the consumer’s right to terminate the contract.

1. Interaction of the Universal Service Directive and Directive 93/13

27. As has been extensively discussed both in the written observations as in those presented during the hearing, in Directive 93/13 the EU legislature established an exception, in respect of price-indexation clauses, to the classification of terms which enable the supplier to alter prices as unfair.

28. The fact remains that the Annex to Directive 93/13 ( ) gives the consumer’s right to terminate a decisive value as one of the factors making it possible to establish the unfairness of clauses that allow a modification in the contractual conditions (point 1(j) of the Annex) and of clauses which allow the supplier to increase prices (point 1(l) of the Annex). ( ) However, in relation to the latter clauses, the Annex itself to Directive 93/13 establishes a clear exception with regard to ‘price-indexation clauses, where lawful, provided that the method by which prices vary is explicitly described’. ( )

29. Although it is apparent from the above that Directive 93/13 specifically considers not to be unfair price-indexation clauses that are lawful and contain an explicit description of the method by which prices vary, it must be stressed that the Universal Service Directive, which is the subject-matter of the question which has been referred for a preliminary ruling, applies without prejudice to the provisions of Directive 93/13. ( ) That means, most particularly, that the fact that a price-indexation clause is not considered unfair, within the meaning of Directive 93/13, by no means prejudges whether a variation in prices resulting from its application may constitute a modification in the contractual conditions within the meaning of the Universal Service Directive, with the logical consequences with regard to the right to terminate under Article 20(2) contemplated in that provision.

30. This is the background against which we must give a useful reply to the question referred for a preliminary ruling in this case, for, as the Commission has indeed pointed out at the hearing, in none of the observations presented before the Court of Justice has it been argued that the clauses with which we are concerned are unfair. Unlike the provisions of Directive 93/13, the Universal Service Directive does not make the right to terminate conditional in any way on a declaration that the clauses concerned are unfair. The reply to the question with which we are concerned therefore stems only from the interpretation of the ‘modifications in the contractual conditions’, within the meaning of Article 20 (2) of the Universal Service Directive, always irrespective of whether the attitude of the EU legislature to price-indexation clauses, as shown in the Annex to Directive 93/13, indicates the particular consideration to be given to the practice of indexation.

2. Interpretation of the expression ‘modifications in the contractual conditions’, within the meaning of Article 20(2) of the Universal Service Directive

31. Directive 2002/22 is a key legal instrument in the liberalisation of the telecommunications sector, and its primary aim is to ensure the availability throughout the Community of good quality publicly available services through effective competition and choice, To this end it establishes at the same time a legislative framework, fundamentally by means of its Chapter II, ( ) which makes it possible to deal with circumstances in which the needs of end-users are not satisfactorily met by the market. ( ) As has repeatedly been held in the case-law of the Court of Justice, Directive 2002/22 ‘is intended to create a harmonised regulatory framework which secures, in the electronic communications sector, the delivery of universal service, that is to say, of a defined minimum set of services to all end-users at an affordable price’. ( )

32. In this context, the Directive also seeks to establish a set of rights of end-users and the corresponding obligations of undertakings providing electronic communications networks and services, ( ) to which it devotes Chapter IV, in which it places the provision whose interpretation constitutes the subject-matter of this case. ( ) The aim of protecting consumers therefore underlies the provisions of the Universal Service Directive and is also closely related to the liberalisation of the telecommunications market. ( )

33. As recital 30 in the preamble to the Universal Service Directive emphasises, in this sphere of the protection of the rights and interests of end-users, contracts are an important tool for ensuring a minimum level of legal certainty and transparency of information. This is guaranteed, in particular, by specifying the conditions by which the contract is governed, among which transparency of the conditions relating to the method of fixing tariffs is particularly important for users. ( ) In the light of this aim, Article 20(1) of the Directive establishes the points which the contract must specify in a clear, comprehensive and easily accessible form. Those points include ‘details of prices and tariffs, the means by which up-to-date information on all applicable tariffs and maintenance charges may be obtained …’

34. It cannot be inferred, from the obligation to include in the contract details and up-to-date information relating to prices and tariffs, that the Universal Service Directive and, in particular, Article 20(1) thereof, requires those prices and tariffs to be established at a fixed and immutable monetary value, precluding the possibility of introducing provisions concerning the conditions for varying them. In this regard, it is clear from Article 20(2) of the Universal Service Directive, as the Court of Justice declared in the judgment in RWE Vertrieb when it interpreted point 2(b), second indent, and (d) of the Annex to Directive 93/13, and Annex A(b) to Directive 2003/55 concerning common rules for the internal market in natural gas, ( ) that the EU legislature has recognised, in the context of contracts of indeterminate duration, in this case, telecommunications contracts, ‘the existence of a legitimate interest of the supply undertaking in being able to alter the charge for its service ’. ( )

35. In this regard, and as a first conclusion, I believe that a literal interpretation of the concept of ‘modifications in the contractual conditions’, as stated in Article 20(2) of the Universal Service Directive, leads to the conclusion that an adjustment to the tariffs resulting from application of the contractual conditions does not constitute, strictly speaking, a contractual modification, but the application or performance of the provisions of one of the contractual conditions laid down ab initio.

36. Nevertheless, a conclusion such as that above, stated in such general and undifferentiated terms, carries a clear risk of diminishing the effectiveness of the right to terminate provided for in Article 20(2) of the Directive. Indeed, any price or tariff variation clause, however it is configured, if it is laid down in the contract ab initio, might thus deprive subscribers of the opportunity to terminate the contract unilaterally without penalty, even if it is a clause of indeterminate form, subject to the unilateral will of the company supplying the services, which alters the equilibrium established by the contractual conditions stipulated initially with unforeseeable results for the user.

37. As an immediate consequence of the above, it becomes apparent that it is necessary to make sure that the consideration payable by the subscriber as an ‘index-linked price ‘is shown with sufficient foreseeability, transparency and legal certainty to support the conclusion that there is no modification in the contractual conditions, within the meaning of Article 20(2) of the Universal Service Directive, having regard to the content of the clauses at issue and to the specific characteristics of the contracts in which they are inserted.

38. The general contractual conditions at issue provide rules which govern the fixing of tariffs for the case in which that indexation has been agreed. On the one hand, in that situation, there is no provision for automatic price indexation, ( ) but more precisely, for the possibility for the supplier of increasing tariffs for the following calendar year according to the increase of the annual consumer price index compiled by Statistik Austria. On the other hand, conversely, the supplier is required to pass on reductions of the annual CPI by reducing the aforementioned tariffs in the customers’ favour. This obligation is mitigated only if the operator has refrained from increasing tariffs which it would have been authorised to do, in accordance with clause, in the previous period, thus maintaining the equilibrium between the interests of the contracting parties.

39. As A1 Telekom Austria pointed out at the hearing, most of the contracts in which the clause at issue is inserted are contracts of indeterminate duration which may, in any case, be terminated without penalty if one month’s notice is given. On the other hand, fixed-term contracts, to which the clause with which we are concerned would also be applicable and under which a penalty would indeed be imposed on the subscriber for early termination have a minimum term of two years at most.

40. That said, it is for the national court to assess whether, in this case, there is sufficient legal certainty, foreseeability and transparency to conclude that there is no modification in the contractual conditions, within the meaning of Article 20 (2) of the Universal Service Directive. In this regard, it is necessary to take into consideration various particularly relevant factors in order to make that assessment.

41. In the first place, it should be pointed out that the concept of modification in the contractual conditions, in a situation in which adjustments to tariffs are the consequence of one of the clauses initially laid down in the contract, means that there is a change in the subscriber’s position. ( ) Thus, a variation of prices brought about in accordance with an indexation clause must be seen from the perspective of the continuity of the life of the contract, ( ) ensuring the maintenance of the initial balance of the undertakings given and the equivalence of the reciprocal obligations within a specific contractual framework. In this context, it is also necessary to examine the particular function of indexation in long-term contracts or contracts of indeterminate duration.

42. In the second place, it has to be considered whether the variation of those tariffs is provided for in the contract in a manner detailed, precise, comprehensible and transparent to the subscriber, referring to an index easily accessible to the public, fixed by a third body, irrespective of the wishes of the service provider, in accordance with objective criteria and in such a way that application of the clauses does not produce results that are unforeseeable or disproportionate for subscribers.

43. In the third place, the fact that an indexation clause is not applied automatically does not necessarily mean that there is a modification in the contractual conditions within the meaning of Article 20(2) of the Universal Service Directive, provided that that lack of automatic effect operates, by maintaining the balance of the interests of the contracting parties, in favour of subscribers.

44. Finally, I think it unnecessary to take into consideration the claims based on the interpretation which the Oberster Gerichtshof itself has offered in relation to the national legislation transposing Article 44 of Directive 2007/64 payment services, to the effect that any adjustment other than an adjustment resulting from a change in interest rates is to be regarded as included in the concept of contractual modification. Irrespective of whether the specificity of the payment services regulated by that provision may be against an automatic transposition of that interpretation to the sphere of the Universal Service Directive, at all events, the aforementioned provision of Directive 2007/64, which is not the subject-matter of the present dispute, has not yet been interpreted by the Court of Justice.

45. In short, I consider that a variation of tariffs brought about by the application of a price adjustment clause does not imply a modification in the contractual conditions, within the meaning of Article 20(2) of the Universal Service Directive, in so far as the statement of the consideration payable by the subscriber as the ‘index-linked price’ has sufficient foreseeability, transparency and legal certainty to support the conclusion that there has been no change in the subscriber’s contractual position. It is for the national court, in the light of the content of the clauses at issue and of the specific characteristics of the contracts in which they are inserted, to make that assessment.

V – Conclusion

46. In the light of the foregoing, I consider that the reply to be given to the question referred for a preliminary ruling by the Oberster Gerichtshof should be as follows:

‘A variation of tariffs brought about by the application of a price adjustment clause does not imply a modification in the contractual conditions, within the meaning of Article 20(2) of the Universal Service Directive, in so far as the statement of the consideration payable by the subscriber as the ‘index-linked price’ is sufficiently foreseeable, transparent and legally certain to support the conclusion that there has been no change in the subscriber’s contractual position. It is for the national court, in the light of the content of the clauses at issue and of the specific characteristics of the contracts in which they are inserted, to make that assessment.’