Provisional text

OPINION OF ADVOCATE GENERAL

PITRUZZELLA

delivered on 20 October 2022 ( )

Case C‑329/21

DIGI Communications NV

v

Nemzeti Média- és Hírközlési Hatóság Hivatala,

intervener:

Magyar Telekom Nyrt.

(Request for a preliminary ruling from the Fővárosi Törvényszék (Budapest High Court, Hungary)

(Reference for a preliminary ruling – Electronic communications networks and services – Directives 2002/20/EC and 2002/21/EC – Auction procedure for the award of rights to use radio frequencies – Exclusion from the procedure of a holding company not registered as a provider of electronic communications services in the Member State concerned – Right of appeal against the award decision)





1. In the request for a preliminary ruling addressed in this Opinion the Fővárosi Törvényszék (Budapest High Court, Hungary) asks the Court of Justice a series of questions concerning the interpretation of Article 4(1) of Directive 2002/21/EC ( ) (‘the Framework Directive’), Article 7 of Directive 2002/20/EC ( ) (‘the Authorisation Directive’) and Article 47 of the Charter of Fundamental Rights of the European Union (‘the Charter’).

2. Those questions arose in the context of an appeal brought by DIGI Communications NV (‘DIGI’) against the decision by which the Nemzeti Média-és Hírközlési Hatóság (‘NMHH’), the Hungarian telecommunications regulatory authority, awarded rights to use radio frequencies for additional wireless broadband services in support of the roll-out of 5G (‘the award decision’).

I. Legal framework

A. The Framework Directive

3. The version of the Framework Directive which applies to the facts in the main proceedings is the version as last amended by Directive 2009/140/EC. ( ) The Framework Directive was repealed and replaced by Directive (EU) 2018/1972 ( ) with effect from 20 December 2020.

4. The first subparagraph of Article 4(1) of the Framework Directive, in the version applicable to the facts in the main proceedings, provides as follows:

‘Member States shall ensure that effective mechanisms exist at national level under which any user or undertaking providing electronic communications networks and/or services who is affected by a decision of a national regulatory authority has the right of appeal against the decision to an appeal body that is independent of the parties involved. This body, which may be a court, shall have the appropriate expertise to enable it to carry out its functions effectively. Member States shall ensure that the merits of the case are duly taken into account and that there is an effective appeal mechanism.’

5. Article 8 of the Framework Directive, in the version applicable to the facts of the case, entitled ‘Policy objectives and regulatory principles’, provides, in paragraph 2(a), (b) and (d) and in paragraph 5(c), as follows:

‘2. The national regulatory authorities shall promote competition in the provision of electronic communications networks, electronic communications services and associated facilities and services by inter alia:

(a) ensuring that users, including disabled users, elderly users, and users with special social needs derive maximum benefit in terms of choice, price, and quality;

(b) ensuring that there is no distortion or restriction of competition in the electronic communications sector, including the transmission of content;

…

(d) encouraging efficient use and ensuring the effective management of radio frequencies and numbering resources.

…

5. The national regulatory authorities shall, in pursuit of the policy objectives referred to in paragraphs 2, 3 and 4, apply objective, transparent, non-discriminatory and proportionate regulatory principles by, inter alia:

…

(c) safeguarding competition to the benefit of consumers and promoting, where appropriate, infrastructure-based competition’.

B. The Authorisation Directive

6. The version of the Authorisation Directive which applies to the facts in the main proceedings is the version as amended by Directive 2009/140. The Authorisation Directive was also repealed and replaced by Directive 2018/1972 with effect from 20 December 2020.

7. According to Article 1 of the Authorisation Directive, the aim of that directive is ‘to implement an internal market in electronic communications networks and services through the harmonisation and simplification of authorisation rules and conditions in order to facilitate their provision throughout the Community’.

8. Article 2(2) of the Authorisation Directive, in the version applicable to the facts in the main proceedings, defines the concept of ‘general authorisation’ as ‘a legal framework established by the Member State ensuring rights for the provision of electronic communications networks or services and laying down sector specific obligations that may apply to all or to specific types of electronic communications networks and services, in accordance with [that directive]’.

9. Article 3 of the Authorisation Directive, entitled ‘General authorisation of electronic communications networks and services’, provides as follows:

‘1. Member States shall ensure the freedom to provide electronic communications networks and services, subject to the conditions set out in this Directive. To this end, Member States shall not prevent an undertaking from providing electronic communications networks or services, except where this is necessary for the reasons set out in Article 46(1) of the Treaty.

2. The provision of electronic communications networks or the provision of electronic communications services may, without prejudice to the specific obligations referred to in Article 6(2) or rights of use referred to in Article 5, only be subject to a general authorisation. The undertaking concerned may be required to submit a notification but may not be required to obtain an explicit decision or any other administrative act by the national regulatory authority before exercising the rights stemming from the authorisation. Upon notification, when required, an undertaking may begin activity, where necessary subject to the provisions on rights of use in Articles 5, 6 and 7.

…

3. The notification referred to in paragraph 2 shall not entail more than a declaration by a legal or natural person to the national regulatory authority of the intention to commence the provision of electronic communication networks or services and the submission of the minimal information which is required to allow the national regulatory authority to keep a register or list of providers of electronic communications networks and services. This information must be limited to what is necessary for the identification of the provider, such as company registration numbers, and the provider’s contact persons, the provider’s address, a short description of the network or service, and an estimated date for starting the activity.’

10. Article 7(1)(a), (3) and (5) of the Authorisation Directive, in the version applicable to the facts in the main proceedings, provides as follows:

‘1. Where a Member State is considering whether to limit the number of rights of use to be granted for radio frequencies or whether to extend the duration of existing rights other than in accordance with the terms specified in such rights, it shall inter alia:

(a) give due weight to the need to maximise benefits for users and to facilitate the development of competition;

…

3. Where the granting of rights of use for radio frequencies needs to be limited, Member States shall grant such rights on the basis of selection criteria which must be objective, transparent, non-discriminatory and proportionate. Any such selection criteria must give due weight to the achievement of the objectives of Article 8 of [the Framework Directive] and of the requirements of Article 9 of that Directive.

…

5. This article is without prejudice to the transfer of rights of use for radio frequencies in accordance with Article 9b of [the Framework Directive].’

II. The main proceedings, the questions referred for a preliminary ruling and the procedure before the Court of Justice

11. On 18 July 2019, NMHH launched a procedure to auction rights to use radio frequencies for additional wireless broadband services in support of the roll-out of 5G (‘the auction procedure’) and published documentation containing the relevant rules (‘the Documentation’).

12. DIGI, a company registered in the Netherlands but not registered in Hungary as an electronic communications service provider, applied to take part in the auction procedure, but its application was formally declared invalid by NMHH. The latter had taken the view that DIGI had abused its right to take part in the auction procedure, had engaged in conduct designed to circumvent the procedure and had attempted to mislead it. Indeed, NMHH took the view that DIGI had applied in place of its Hungarian subsidiary DIGI Távközlési és Szolgáltató Korlátolt Felelősségű Társaság (‘DIGI Kft.’), a company registered in Hungary and providing electronic communications services in that country, which, had it applied itself, would have been excluded pursuant to the rule in Article 61(n) of the Documentation. ( ) By a final decision, NMHH thus refused to register DIGI’s application to take part in the auction procedure and concluded that it had forfeited its status as a party to that procedure.

13. The applicant brought a legal action to challenge that decision, but its action was dismissed at first instance, by the referring court, and at second instance, by final judgment of the Kúria (Supreme Court, Hungary).

14. During the course of the legal proceedings instituted by DIGI, NMHH adopted the award decision, by which the rights to use the radio frequencies that were the subject of the auction procedure were granted to the three principal providers of electronic communications services, leaving aside DIGI Kft., present on the Hungarian market.

15. The applicant commenced an administrative-law action before the referring court, seeking the annulment of the award decision.

16. Given that DIGI is not one the addressees of the award decision, having been excluded from the auction procedure, the referring court considers that it must examine, as a preliminary matter, whether that company has standing to bring proceedings and, in particular, whether it may be regarded as an ‘affected undertaking’, within the meaning of Article 4(1) of the Framework Directive, which, in accordance with that provision, must enjoy a right of appeal.

17. Since the Framework Directive does not define that concept, the Fővárosi Törvényszék (Budapest High Court), relying on the Court of Justice’s judgments of 21 February 2008, Tele2 Telecommunication ( ) (‘the judgment in Tele2’), of 24 April 2008, Arcor ( ) (‘the judgment in ‘Arcor’), and of 22 January 2015, T-Mobile Austria ( ) (‘the judgment in T-Mobile’), concluded that the Court had examined three requirements which determine whether an undertaking has a right of appeal under Article 4(1), namely: (i) the undertaking in question must be an undertaking that provides electronic communications networks or services in competition with the undertaking or undertakings to which the national regulatory authority’s decision is addressed; (ii) the national regulatory authority (‘NRA’) must have adopted the decision at issue in the context of a procedure intended to safeguard competition; and (iii) that decision has or is likely to have an impact on the position on the market of the first undertaking.

18. Essentially, each of the questions referred for a preliminary ruling is intended to obtain clarification from the Court regarding the application of those requirements to the facts in the main proceedings.

19. It is in that context that the Fővárosi Törvényszék (Budapest High Court) decided to stay the proceedings and refer the following questions to the Court for a preliminary ruling:

‘(1) 1.1 Can an undertaking be considered a competitor of the undertakings to which a decision of [an NRA] falling within the terms of Article 4(1) of [the Framework Directive] is addressed, where the undertaking in question is registered and operates in another Member State and does not itself provide electronic communications services in the market to which the decision refers, but an undertaking under its direct control is present in the relevant market as a service provider and competes in that market with the undertakings to which the decision is addressed?

1.2 In order to reply to question 1.1, is it necessary to examine whether the parent company that wishes to bring the action forms an economic unit with the undertaking under its control which is present as a competitor in the relevant market?

(2) 2.1 Is an auction of rights to use radio frequencies for additional wireless broadband services in support of the roll-out of 5G conducted by [an NRA], falling within the terms of Article 4(1) of the Framework Directive and Article 7 of [the Authorisation Directive], a procedure intended to safeguard competition? Must the decision of the [NRA] announcing the outcome of the auction procedure also be considered a procedure intended to safeguard competition in that regard?

2.2 If the reply from the Court of Justice to question 2.1 is in the affirmative, is the decision’s objective of safeguarding competition affected by the fact that, in a final decision contained in a separate ruling, the [NRA] refused to register the bid submitted by the undertaking that is bringing an action, with the result that that undertaking was unable to take part in the auction procedure and was therefore not an addressee of the decision that determined the outcome of that procedure?

(3) 3.1 Must Article 4(1) of the Framework Directive, in conjunction with Article 47 of the [Charter], be interpreted as conferring a right of appeal against a decision by [an NRA] on an undertaking only where the position of that undertaking in the market:

(a) is directly and genuinely affected by the decision; or

(b) is shown to be highly likely to be affected by the decision; or

(c) may be directly or indirectly affected by the decision?

3.2 Is the fact that the undertaking submitted a bid in the auction procedure, that is to say, that it wished to take part in the procedure but was unable to do so because it did not satisfy the requirements, in itself proof of the effect referred to in question 3.1, or can the court legitimately require the undertaking also to furnish evidence to show that it is affected by the decision?

(4) In the light of the replies to questions 1 to 3, must Article 4(1) of the Framework Directive, in conjunction with Article 47 of the [Charter], be interpreted as meaning that an undertaking is an electronic communications provider affected by a decision of the [NRA] announcing the outcome of an auction of rights to use radio frequencies for additional wireless broadband services in support of the roll-out of 5G, and therefore has a right of appeal, where that undertaking:

– does not carry on an economic activity involving the provision of services in the relevant market, but directly controls an undertaking that provides electronic communications services in that market; and

– was denied registration in the auction procedure by a final decision of the [NRA] before the decision on the outcome of the contested auction procedure was adopted, thus preventing the undertaking from subsequently taking part in the procedure?’

20. The parties to the main proceedings and the European Commission have submitted written observations, pursuant to Article 23 of the Statute of the Court of Justice. Those interested parties presented oral argument at the hearing on 1 June 2022.

III. Analysis

A. Preliminary observations

21. In formulating the questions to be referred for a preliminary ruling, the referring court started from the premiss that, in order to be considered to be ‘affected’ within the meaning of Article 4(1) of the Framework Directive and thus benefit from a right of appeal against a decision of an NRA, an undertaking must necessarily be a direct and current competitor of the undertaking or undertakings to which that decision is addressed.

22. For that reason, the first question seeks clarification regarding the possible status of ‘competitor’ of the undertakings that were successful in a selection procedure for the award of rights to use radio frequencies of an undertaking which, like DIGI, does not provide electronic communications services other than indirectly, through the companies of the group of which it is the holding company.

23. Like the Commission, I think that the premiss adopted by the Fővárosi Törvényszék (Budapest High Court) is the result of misinterpretation of the judgments in Tele2, Arcor and T-Mobile.

24. It is certainly true that, in the cases which gave rise to those rulings, the undertakings whose right of appeal was in dispute were in competition with the undertaking or undertakings to which the NRA’s decision was addressed on the market of the Member State concerned by that decision. ( ) However, there is, in my view, no passage in those judgments that supports the inference that the Court meant to limit the scope ratio personae of that provision solely to the circle of competitors, current or even only potential, of the addressees of the NRA decision in question.

25. In those judgments the Court in fact held that the obligation upon Member States to provide effective judicial protection, enshrined in Article 47 of the Charter and given expression in Article 4 of the Framework Directive, ‘must also apply to users and undertakings which may derive rights from the EU legal order, in particular from the directives on electronic communications, and whose rights are affected by a decision taken by an NRA’. ( )

26. Thus, according to the judgments just mentioned, there are two conditions for an undertaking to be able to consider itself ‘affected’, within the meaning of Article 4 of the Framework Decision, by a decision of an NRA of which it is not an addressee.

27. As regards the first condition, relating to the enjoyment of rights conferred by the EU legal order, the Court has specifically held that to be satisfied in the case of undertakings competing with an undertaking with significant power on the relevant market, as potential beneficiaries of the rights corresponding to the specific regulatory obligations imposed by an NRA on that undertaking, in accordance with Article 16 of the Framework Directive, ( ) or in the case of a beneficiary within the meaning of Article 2(b) of Regulation (EC) No 2887/2000 ( ) which has concluded with the notified operator, within the meaning of Article 2(a) of that regulation, a contract concerning access to the local loops, ( ) or, lastly, in the case of an undertaking in the context of a procedure for the authorisation of the modification of the ownership structure of a competing undertaking that entails a modification of the distribution of radio frequencies between the undertakings active on the market.

28. As regards the second condition, the rights which an undertaking within the meaning of Article 4(1) of the Framework Directive enjoys under the EU legal order may potentially be affected by a decision of an NRA by reason of the decision’s content and the activity carried on or envisaged by that undertaking. ( ) In the case of undertakings in competition with the addressee or addressees of an NRA decision, the Court has made clear, in its judgment in T-Mobile, that Article 4(1) covers such undertakings ‘in so far as the decision in question is likely to have an impact on their position on the market’. ( )

29. Admittedly, in paragraph 39 of that judgment, to which the national court points in the formulation of the questions it has referred for a preliminary ruling, the Court also stated, more generally, that an undertaking ‘must be regarded as being “affected”, for the purposes of Article 4(1) of the Framework Directive, by a decision of an NRA adopted in the context of a procedure provided for by the directives on electronic communications where that undertaking, which provides electronic communications networks or services, is a competitor of the undertaking or undertakings to whom the NRA’s decision is addressed, where the NRA’s decision is adopted in the context of a procedure intended to safeguard competition and where the decision in question is likely to have an impact on the position on the market of that first undertaking’.

30. Nevertheless, it is apparent, in my view, from the clear references in paragraphs 39 and 40 of that judgment to the particular position of the appellant in the main proceedings in connection with which the Court of Justice gave its ruling that the Court’s intention was not to restrict the scope of Article 4(1) of the Framework Directive solely to competing undertakings or, in any event, not solely to ‘current competitors’ of the addressee or addressees of the NRA’s decision on the national market concerned by that decision.

31. That said, the wording of Article 4(1) of the Framework Directive limits the extent of the obligation which it imposes on Member States to ensure that effective mechanisms exist for appealing against decisions of an NRA to users and to any undertakings ‘providing electronic communications networks and/or services’. It follows that an undertaking which cannot be considered a ‘user’ within the meaning of Article 2(h) of the Framework Directive ( ) or which does not provide a network, as stipulated in Article 2(m) of that framework directive, must, in order to enjoy the right of appeal under Article 4(1) thereof, show that it is a provider of electronic communications services.

32. While it is true that neither the Framework Directive nor the Authorisation Directive contains a definition of the concept of ‘provider of electronic communications services’, ( ) in order to delimit the circle of undertakings that may be regarded as falling within that definition, reference may be made to the general scheme of the Authorisation Directive.

33. That directive defined a legal framework to ensure the freedom to provide electronic communications networks and services, one designed to ensure that all providers might benefit, on the one hand, from objective, transparent, non-discriminatory and proportionate conditions and procedures ( ) and, on the other, from an authorisation system that is ‘the least onerous … possible’, ‘in order to stimulate the development of new electronic communications services and pan-European communications networks and services and to allow service providers and consumers to benefit from the economies of scale of the single market’. ( ) That legal framework established a ‘general authorisation’ regime ( ) that encompasses all networks and electronic communications services and does not require any explicit decision or administrative act on the part of the NRA.

34. Thus, in accordance with the first sentence of Article 3(2) of the Authorisation Directive, in the version applicable to the facts in the main proceedings, ‘the provision of electronic communications networks or the provision of electronic communications services may … only be subject to a general authorisation’. In accordance with Article 6(1) of that directive, the general authorisation for the provision of electronic communications networks or services may be subject only to the conditions listed in the annex to that directive. Those conditions must be non-discriminatory, proportionate and transparent.

35. Furthermore, pursuant to the second sentence of Article 3(2) of the Authorisation Directive, ‘the undertaking concerned may be required to submit a notification but may not be required to obtain an explicit decision or any other administrative act by the national regulatory authority before exercising the rights stemming from the authorisation’.

36. An undertaking which satisfies the conditions to which the general authorisation referred to in the first sentence of Article 3(2) of the Authorisation Directive is subject in the Member State concerned may, in my view, be regarded as an ‘undertaking providing electronic communications networks and/or services’, within the meaning of Article 4(1) of the Framework Directive, without any formal recognition of that status being required of the administrative authorities of that Member State and, in particular, without it being necessary for the undertaking to have submitted the notification referred to in the second sentence of Article 3(2) of the Authorisation Directive, where that is required by that Member State. Such a notification is in fact necessary solely in order to commence the activity of providing electronic communications networks or services in the Member State in question and cannot, in particular, be required in order to participate in procedures for the allocation of radio frequencies, such as that at issue in the main proceedings. ( )

37. It follows that the right of appeal provided for in Article 4(1) of the Framework Directive may be asserted even by an undertaking that is not yet directly or indirectly present on the market of the Member State concerned by the NRA’s decision and/or registered as a provider of electronic communications services in that Member State, and notably by an undertaking active in that sector but in a different Member State.

38. Nonetheless, since the wording of Article 4(1) of the Framework Directive refers to the pursuit of an activity of providing electronic communications services, I consider that, albeit not excluding from the scope of that provision undertakings which are not yet actually operating in that sector, that wording requires that the undertaking in question must demonstrate a real intention and a possibility, not merely a theoretical one, in terms of infrastructure and technology, of joining the market for the provision of electronic communications networks and/or services in order to claim that it is ‘affected’, within the meaning of that provision.

39. It is on the basis of those considerations that I shall proceed to examine the questions referred by the Fővárosi Törvényszék (Budapest High Court).

40. Contrary to NMHH’s contention, those questions are, in my view, admissible. The arguments by which NMHH seeks to demonstrate that they are inadmissible in fact venture upon the substantive consideration of those questions.

B. The first question referred for a preliminary ruling

41. In the first part of the first question referred for a preliminary ruling, the referring court essentially asks the Court of Justice whether a legal person, incorporated in a Member State other than that concerned by the decision by which an NRA has allocated radio frequencies upon the conclusion of an auction procedure, may be regarded as a ‘competitor’ of the undertakings to which that decision is addressed and may therefore assert the right of appeal against that decision, in accordance with Article 4(1) of the Framework Directive, where that legal person, while not being registered as a provider of electronic communications services in the Member State concerned, and while not itself carrying on that activity and not possessing in its own name infrastructure for that purpose, is nevertheless the holding company of a group that does provide such services in the European Union, and operates, in the Member State concerned by the NRA decision in question, through a subsidiary which is registered in that Member State as a provider of such services. In the second part of the first question referred for a preliminary ruling, the referring court asks, in essence, whether it is necessary, in order to answer the first part of the question, to examine whether the legal person in question forms an ‘economic unit’, under EU antitrust law, with the subsidiary which is present on the national market concerned by the NRA’s decision.

42. As is apparent from my observations in points 23 to 30 of this Opinion, the first question referred for a preliminary ruling, in so far as it restricts the scope of Article 4(1) of the Framework Directive solely to actual competitors of the addressee or addressees of the NRA’s decision, is based on a misconception and must, for that reason, be reformulated.

43. Taken as a whole, that question should, in my view, be understood in the sense that the referring court is asking whether a legal person in the situation described in point 41 of this Opinion may be regarded as an undertaking ‘providing … electronic communications services’ within the meaning of Article 4(1) of the Framework Directive and whether it is relevant to the answer to that question that that legal person and the subsidiary which operates on the national market concerned form an ‘economic unit’ within the meaning of EU antitrust law.

44. DIGI and the Commission propose that that question be answered in the affirmative, whereas NMHH suggests it should be answered in the negative.

45. It is necessary, first of all, to dismiss the argument, put forward by NMHH in its written observations, that only the undertakings that are addressees of a decision such as that at issue in the main proceedings may appeal against that decision. On this point, suffice it to recall that, in the judgment in Tele2, the Court held, albeit in a different context, that ‘a strict interpretation of Article 4(1) of the Framework Directive to the effect that that provision confers a right of appeal only on persons to whom the decisions of the [NRAs] are addressed would be difficult to reconcile with the general objectives and regulatory principles resulting, for those authorities, from Article 8 of that directive, particularly with the objective of promoting competition’. ( ) There are no reasons, in particular no reasons relating to the nature of the decision at issue in the main proceedings or to the circumstances specific to those proceedings, which would permit a departure from that interpretation of Article 4(1) of the Framework Directive. In view of the wording used by the Court, that interpretation is clearly one of general application.

46. That much being clear, it also follows from point 36 of this Opinion that an undertaking which satisfies the conditions to which the general authorisation referred to in the first sentence of Article 3(2) of the Authorisation Directive is subject in the Member State concerned may be regarded as having the status of an ‘undertaking providing electronic communications networks and/or services’, within the meaning of Article 4(1) of the Framework Directive, even if that undertaking is not yet present on the market in that Member State and is not yet registered there for the purposes of the second sentence of Article 3(2) of the Authorisation Directive. It also follows from point 38 of this Opinion that it is not even necessary for such an undertaking to be currently providing electronic communications services, provided, however, that it demonstrates a real intention and a possibility, not merely a theoretical one, in terms of infrastructure and technology, of joining that market, either in the Member State concerned or in another Member State.

47. Separate considerations are, in my view, called for where, as in the case in the main proceedings, the legal person which asserts the right of appeal under Article 4(1) of the Framework Directive, while not being directly present on the market for the provision of electronic communications services, is the parent company of a group of companies which do provide such services. I do not in fact rule out that such a legal person should also be regarded as having the status of an ‘undertaking providing electronic communications services’ within the meaning of that provision, it being understood that it will nevertheless have to demonstrate that it is ‘affected’, within the meaning of Article 4(1) of the Framework Directive, by the decision in question, which is to say, as the case-law makes clear, that the rights which it enjoys under the EU legal order, in particular under the directives on electronic communications services have been adversely affected by that decision.

48. Two points need to be made with regard to the situation described in the preceding point.

49. In the first place, acknowledging the status of ‘undertaking providing electronic communications services’, within the meaning of Article 4(1) of the Framework Directive, of a company that heads a group which provides such services is justified solely on account of its indirect presence on the market and does not depend either on the existence of a competitive relationship with the addressees of the NRA decision in question or on its forming an ‘economic unit’, for the purposes of EU antitrust law, with the subsidiary present on the market concerned by that decision.

50. With regard to that last point, I think such a circumstance is in any event irrelevant, whatever interpretation of Article 4(1) of the Framework Directive the Court reaches.

51. The concept of ‘economic unit’, which is closely connected with the functional concept of ‘undertaking’ under EU antitrust rules, has been developed for the particular purpose of identifying the entity to which an infringement of EU antitrust rules may be imputed and, in that context, it is essentially employed so that, subject to certain conditions, the anticompetitive conduct of a subsidiary may be imputed to its parent company, and the obstacle of the separate legal personalities of the two entities may be overcome.

52. These concepts are peculiar to antitrust law, in the context of which they have the dual function of repressing and deterring anticompetitive conduct. Exporting these concepts to other areas of EU law, even to those in which objectives of protecting competition are significant, does not therefore seem appropriate to me.

53. In the second place, contrary to what the referring court appears to assert, to accept that the status of ‘undertaking providing electronic communications services’, within the meaning of Article 4(1) of the Framework Directive, may also be attributed to undertakings which are not directly present on the market for such services and, in particular, to the holding company of a group which provides such services, does not, in circumstances such as those of the case in the main proceedings, have the consequence of enabling ‘the circumvention of the rules of a competitive tendering procedure’. Indeed, allowing such an entity the right of appeal against a decision by which an NRA has allocated rights to use radio frequencies upon the conclusion of such a procedure does not preclude the possibility of raising against that entity, if it has made an application in its own name, the grounds for exclusion which would apply to the company forming part of the group that is active on the market concerned by the tendering procedure, if it transpires that its application was made with the sole intention of circumventing the conditions for admission to the procedure.

54. In other words, although the right of appeal against an NRA decision, referred to in Article 4(1) of the Framework Directive, does not necessarily arise from the status of participant in the administrative procedure which led to the adoption of that decision, neither does it automatically imply a right to participate in such a procedure.

55. On the basis of all the considerations set out thus far, I consider that the answer to the first question referred for a preliminary ruling, as reformulated, should be that Article 4(1) of the Framework Directive is to be interpreted as meaning that acknowledgement of the status of ‘undertaking providing electronic communications services’, within the meaning of that provision, of an undertaking which satisfies the conditions to which the general authorisation referred to in the first sentence of Article 3(2) of the Authorisation Directive is subject in the Member State to which the NRA that adopted the decision in question belongs is not precluded either by the fact that that undertaking is not yet present on the market of that Member State and is not yet registered there for the purposes of the second sentence of Article 3(2) of the Authorisation Directive, or by the fact that it does not currently provide electronic communications services, provided, however, that it demonstrates a real intention and a possibility, which is not merely theoretical, in terms of infrastructure and technology, of joining the market for those services in the Member State concerned. The status of ‘undertaking providing electronic communications services’, within the meaning of Article 4(1) of the Framework Directive, may also be acknowledged for a legal person which, while not directly engaged in the provision of electronic communications services, is the holding company of a group which does provide such services.

C. The second question referred for a preliminary ruling

56. In the first part of the second question referred for a preliminary ruling the referring court essentially asks whether an auction of rights to use radio frequencies for additional wireless broadband services in support of the roll-out of 5G, conducted by an NRA in accordance with Article 7 of the Authorisation Directive, and the decision announcing the outcome of the auction procedure have as their objective the safeguarding of competition. It emerges from the order for reference that, in formulating that question, the Fővárosi Törvényszék (Budapest High Court) paid particular attention to paragraph 39 of the judgment in T-Mobile, to which I referred in point 29 of this Opinion, and adopted the premiss that, in order for an undertaking in competition with the addressee or addressees of the NRA decision in question to be regarded as ‘affected’ within the meaning of Article 4(1) of the Framework Directive, that decision must have been adopted within the framework of a procedure designed to safeguard competition.

57. There is no doubt that, as the referring court itself considers, an auction procedure such as that at issue in the main proceedings, initiated in accordance with Article 7 of the Authorisation Directive in circumstances which have rendered it necessary to limit the number of rights of use to be granted for radio frequencies, pursues, as one of its primary objectives, the safeguarding of competition.

58. That follows not only from Article 7(1)(a) of the Authorisation Directive, which expressly requires the Member State concerned to give due weight to the need to facilitate the development of competition, but also from Article 7(3) of that directive.

59. Under that provision, the objective, transparent, non-discriminatory and proportionate selection criteria on the basis of which rights of use of radio frequencies are to be granted ‘must give due weight to the achievement of the objectives of Article 8 of [the Framework Directive]’. Article 8(2) of the Framework Decision lists as one such objective the promotion of competition in the provision of electronic communications networks, electronic communications services and associated facilities and services. Point (b) of Article 8(2) specifies that that objective is to be pursued, inter alia, by ‘ensuring that there is no distortion or restriction of competition in the electronic communications sector’.

60. I would also point out that the Court has clarified that Article 8 of the Framework Directive places on the Member States the obligation to ensure that the NRAs take all reasonable measures aimed at promoting competition in the provision of electronic communications services, ensuring that there is no distortion or restriction of competition in the electronic communications sector and removing remaining obstacles to the provision of those services at EU level. ( )

61. More generally, the Court has stated that the new common regulatory framework for electronic communications services, electronic communications networks, associated facilities and associated services, of which the Framework Directive and the Authorisation Directive are part, ‘is based, inter alia, on an objective of effective and undistorted competition, and aims to develop that competition while respecting, in particular, the principles of equal treatment and proportionality’. ( )

62. It follows that the objective of safeguarding competition expressed in Article 8 of the Framework Directive not only governs the definition of the criteria for admission to a procedure launched on the basis of Article 7 of the Authorisation Directive, but must also be reflected in any decision allocating electronic communications networks and services of limited availability.

63. In the second part of the second question referred for a preliminary ruling, which is put forward in the event that the first part of the question is answered in the affirmative, the referring court asks whether the objective of safeguarding competition, which a decision concluding an award procedure under Article 7 of the Authorisation Directive is recognised as having, is affected by the fact that, in a separate decision that has become final, the NRA refused to register the application submitted by the undertaking that is bringing an action challenging that decision.

64. It is clear from the order for reference that the Fővárosi Törvényszék (Budapest High Court) essentially means to ask the Court about the effect which the definitive exclusion of an undertaking from a procedure for the allocation of rights of use of radio frequencies might have on that undertaking’s standing to bring an action challenging the decision adopted upon the conclusion of that procedure. In particular, the referring court wonders whether the fact that the undertaking’s exclusion from the procedure meant that it could not be an addressee of that decision frustrates, ‘from the undertaking’s perspective’, the objective of safeguarding competition pursued by the decision, to the extent that the decision is incapable of directly altering its position on the market with regard to the rights of use of the radio frequencies in question.

65. It seems clear to me that the circumstance to which the referring court alludes is not in itself capable of frustrating the objective of safeguarding competition which the allocation of rights to use radio frequencies must pursue.

66. Admittedly, the exclusion of an undertaking from the selection procedure which led to an award decision can, in some cases, have an effect on the actual attainment of that objective, in particular if it is the result of the application of criteria which do not fulfil the conditions laid down in Article 7 of the Authorisation Directive.

67. In such a case it is possible that such a decision will not be fully consistent with the objective of safeguarding effective, undistorted competition, or will be entirely contrary to it. However, that in no way alters the fact that that objective remains one of the principal aims which the Framework Directive and the Authorisation Directive assign to such a decision.

68. In reality, by the second part of its second question, the referring court means rather to ask the Court whether the definitive exclusion of an undertaking that has applied to participate in a selection procedure can have an effect on that undertaking’s standing to bring proceedings challenging the final award decision and/or its interest in doing so, and to what extent that effect may be altered by the fact that that final decision and its possible annulment are incapable of altering the undertaking’s position on the market as it pertained at the time of its exclusion.

69. That question is asked, from a different angle, in the second part of the fourth question referred for a preliminary ruling and so it will be analysed in that context.

70. On the basis of all the foregoing considerations, I consider that the answer to the second question referred for a preliminary ruling should be that an auction procedure conducted by an NRA in accordance with Article 7 of the Authorisation Directive, and the decision of that authority announcing the outcome of that procedure, pursue the objective of safeguarding effective, undistorted competition.

D. The third question referred for a preliminary ruling

71. In the first part of the third question referred for a preliminary ruling, the referring court essentially seeks clarification from the Court regarding the condition relating to the effect which an NRA decision must have on the situation of the undertaking providing electronic communications networks or services in order for that undertaking to be able to describe itself as being ‘affected’ by that decision, within the meaning of Article 4(1) of the Framework Decision. In particular, the Fővárosi Törvényszék (Budapest High Court) asks whether such an undertaking is required to demonstrate that the NRA’s decision ‘directly affects’ its position on the market, or whether it is sufficient if the decision is ‘highly likely’ to affect, or only indirectly affects, its position on the market.

72. It is true that, as the referring court has observed, in its judgment in Tele2, the Court interpreted Article 4(1) of the Framework Directive as meaning that undertakings in competition with an undertaking (formerly) having significant power on the relevant market have a right of appeal against a decision adopted by an NRA in the context of a market analysis procedure as referred to in Article 16 of that directive if their ‘rights … are adversely affected’ by that decision, ( ) implying that it is necessary for there to be a direct effect on the market position of such undertakings.

73. Nonetheless, in paragraph 39 of that judgment, the Court held that ‘users and undertakings competing with an undertaking (formerly) having significant power on the market concerned’ must be regarded as being ‘affected’ for the purposes of Article 4(1) of the Framework Directive ‘when their rights are potentially affected by such a decision’.

74. Moreover, in its judgment in T-Mobile, the Court clarified that that provision covers both the addressee of the NRA decision in question as well as other undertakings providing electronic communications networks or services which may be competitors of that addressee, in so far as the decision in question is ‘likely to have an impact’ on their position on the market. ( ) That form of words could also encompass a merely indirect impact.

75. Similarly, as I have already observed, in its judgment in Arcor, the Court, referring to paragraph 39 of the judgment in Tele2, clarified that a beneficiary which is not the addressee of an NRA decision acquires the status of ‘party affected’, within the meaning of Article 5a(3) of Directive 90/387, which was replaced by Article 4(1) of the Framework Directive, when its rights are ‘potentially affected’ by such a decision by reason of the decision’s content and the activity carried on or envisaged by that party. ( )

76. In light of the case-law which I have mentioned, on the one hand, it cannot, in my view, be held necessary, in order to assert the right of appeal under Article 4(1) of the Framework Directive, for the undertaking in question to demonstrate that the NRA decision which it intends to appeal definitely, directly and currently affects its position on the market. In particular, I would reject the view put forward by NMHH that, in the context of an auction procedure such as that at issue in the main proceedings, the right to bring an appeal against the decision adopted by the NRA upon the conclusion of that procedure lies solely with the undertaking or undertakings that have submitted a valid application to participate in the procedure, since only those undertakings are in a position to demonstrate direct and actual harm resulting from that decision. Moreover, since those undertakings will in any event be addressees of the NRA decision announcing the outcome of the selection procedure, that view seems to me to be contradicted by the Court’s finding that it would be inconsistent with the general objectives and regulatory principles resulting, for NRAs, from Article 8 of the Framework Directive, particularly with the objective of promoting competition, to interpret Article 4(1) of that directive as conferring a right of appeal only on persons to whom the decisions of such authorities are addressed. ( )

77. On the other hand, it becomes apparent, in particular, from the reference to the content of the NRA decision at issue and to the activity carried on or envisaged by the undertaking concerned that it is not sufficient for that undertaking to rely on any indirect effect that the decision might have on its market position. In my view, it is only if the rights which that undertaking enjoys under the EU legal order, in particular, under the directives on electronic communications services, are adversely affected as a direct result of the content of such a decision and if that adverse effect, although not necessarily certain and current, is nevertheless likely to materialise with reasonable probability, that the undertaking in question will have the right of appeal under Article 4(1) of the Framework Directive.

78. In the second part of the third question referred for a preliminary ruling, the referring court asks, in essence, whether the effect referred to in the first part of the question is proven simply by the fact that the undertaking in question submitted a bid in the auction procedure, even though it was excluded from that procedure because it did not satisfy the requirements.

79. On this point, I consider that an undertaking which falls within the concept of ‘undertaking providing electronic communications services’, within the meaning of Article 4(1) of the Framework Directive, and which has made a bid to participate in a selection procedure for the award of rights of use of radio frequencies, must be regarded as ‘affected’, for the purposes of that provision, by the decision announcing the outcome of the selection procedure even if it has been excluded from the procedure because it failed to satisfy the condition for admission of not having been found to have infringed the competition rules during a certain period of time preceding the commencement of the auction procedure.

80. The question of whether, and if so in what way, the fact that the NRA’s decision to exclude the undertaking has become final following the dismissal of the legal action brought by the undertaking in question affects that undertaking’s right of appeal against the decision announcing the outcome of the selection procedure will be addressed in the analysis of the fourth question referred for a preliminary ruling.

81. On the basis of all of the foregoing considerations, I suggest that the Court’s answer to the third question referred for a preliminary ruling be that Article 4(1) of the Framework Directive is to be interpreted as meaning that, in order to enjoy the right of appeal against an NRA decision under that provision, an undertaking providing electronic communications networks or services must demonstrate that the content of that decision is liable to have a direct, adverse effect on the rights which that undertaking enjoys under the EU legal order, in particular under the directives on electronic communications services. While that adverse effect need not necessarily be certain and current, it must nevertheless be likely to materialise with reasonable probability. An undertaking which falls within the concept of ‘undertaking providing electronic communications services’, within the meaning of Article 4(1) of the Framework Directive, and which has made a bid to participate in a selection procedure for the award of rights of use of radio frequencies, must be regarded as ‘affected’, for the purposes of that provision, by the decision announcing the outcome of the selection procedure. Such an undertaking will not cease to be ‘affected’ merely because it has been excluded from the procedure because it failed to satisfy the condition for admission of not having been found to have infringed the competition rules during a certain period of time preceding the commencement of the auction procedure.

E. The fourth question referred for a preliminary ruling

82. By its fourth question, which is also divided into two parts, the referring court essentially asks the Court of Justice whether an undertaking is an undertaking ‘affected’, within the meaning of Article 4(1) of the Framework Directive, and has a right of appeal against an NRA decision announcing the outcome of a selection procedure for the award of rights of use of radio frequencies, where that undertaking, on the one hand, is not engaged in the provision of electronic communications services in the Member State concerned other than through a subsidiary (the first part of the question) and, on the other hand, was excluded from the selection procedure by a final decision of the NRA before the decision on the outcome of the selection procedure was adopted (the second part of the question).

83. In so far as concerns the first part, I would confine myself to referring to the considerations set out in points 23 to 30 and 45 to 55 of this Opinion.

84. As regards the second part, in line with the conclusion I drew on examining the third question referred for a preliminary ruling, I consider that Article 4(1) of the Framework Directive, read in the light of Article 47 of the Charter, must be interpreted as meaning that an entity which participates in an auction procedure organised by an NRA in accordance with Article 7 of the Authorisation Directive for the allocation of rights of use of radio frequencies enjoys a right of appeal against the decisions which the NRA adopts in the context of that procedure, whether they are decisions addressed to that entity, such as a decision excluding it from the procedure, or, where the conditions laid down in Article 4(1) of the framework directive are met, decisions not directly addressed to it.

85. Moreover, I would make clear that, in my view, in the case of an appeal against the final award decision brought by an undertaking excluded from such a procedure, as in the main proceedings, that undertaking’s standing to bring proceedings, if it is established that it meets the conditions laid down in Article 4(1) of the Framework Directive, is independent of the nature of the exclusion decision, be it final or otherwise. ( )

86. In the case before the Fővárosi Törvényszék (Budapest High Court), I think clarification is necessary as to whether DIGI has appealed against the award decision in order to call its exclusion from the auction procedure into question and to argue that an unlawful exclusion criterion was applied in its regard, or to allege the unlawfulness of the allocation of radio frequencies which occurred on the basis of documentation containing criteria that were not objective, transparent, non-discriminatory and proportional and which effectively prevented its subsidiary from participating in the procedure. If it is the latter, DIGI would have standing to bring proceedings in its capacity as parent company of the group, rather than as an undertaking excluded from participation.

87. As regards DIGI’s interest in appealing against the award decision, on the one hand, I would not rule out, subject to confirmation by the referring court, that, upon the conclusion of the extraordinary proceedings brought by DIGI before the Alkotmánybíróság (Constitutional Court, Hungary), the lawfulness of the administrative procedure which led to the adoption of the decision to exclude that undertaking from the auction procedure, or the fairness of the legal proceedings which followed are called into question. On the other hand, I would observe that it should not be ruled out, subject again to confirmation by the referring court, that examination of the merits of DIGI’s appeal could result in the award decision and the entire auction procedure being invalidated, rendering it necessary for that procedure to be conducted afresh, with DIGI Kft. being able to participate this time, the period during which the ground for exclusion laid down in Article 61(n) of the Documentation would take effect having expired.

88. NMHH considers that DIGI’s assertion of a right of appeal, on the basis of Article 4 of the Framework Directive, against the decision announcing the outcome of the auction procedure is abusive, since its purpose is to circumvent the effect of the final decision given in DIGI’s appeal against the decision to exclude it from the auction procedure.

89. I would observe in this connection that, while it cannot be ruled out a priori that participation in a procedure launched by an NRA on the basis of provisions of EU law and the subsequent assertion of a right of appeal against decisions adopted by the NRA in that context could, if the conditions laid down in the Court’s case-law ( ) are met, give rise to an abuse of rights, I do not think that that is the situation in the present case.

90. Indeed, first of all, DIGI cannot be regarded as having acted abusively solely because it submitted an application to participate in the auction procedure in its own name, rather than through DIGI Kft. That would remain the case even if its true intention had been to transfer to DIGI Kft. any rights it might acquire upon the conclusion of that procedure, at least not in so far as DIGI had proceeded on the premiss that the provision in the Documentation under which its subsidiary was de facto excluded from the auction procedure was unlawful. Secondly, contrary to NMHH’s submission, by invoking Article 4 of the Framework Directive as justification of its right of appeal, DIGI is seeking recognition of its right to participate in the auction procedure – a right of which it considers itself to have been deprived in breach of rules of EU law – and not to avail itself of those rules fraudulently or abusively in order to obtain an undue advantage. ( ) If it transpires that the provisions of Hungarian law governing res judicata preclude any examination of the grounds of appeal put forward by DIGI in such proceedings, the latter could, for that reason, be declared wholly or partially inadmissible, but commencing those proceedings cannot be likened to an abusive practice solely because of the possibility that such a bar might apply.

91. That said, it is for the referring court to assess whether, and if so to what degree, the plea of res judicata applies in the case before it.

92. DIGI argues that, in delivering its judgment in the appeal which it brought against the judgment of the Fővárosi Törvényszék (Budapest High Court) confirming NMHH’s decision to exclude it from the auction procedure, the Kúria (Supreme Court), in breach of Article 267 TFEU, as interpreted by the Court, ( ) failed to fulfil its obligation, as court of last instance, to make a reference to the Court of Justice for a preliminary ruling, as DIGI had requested. DIGI considers that, in those circumstances, in line with the solution adopted by the Court in its judgment of 18 July 2007, Lucchini, ( ) the national rules governing the authority of res judicata should be disapplied in this case, so as to ensure the full effect of the rules of EU law.

93. In this regard, suffice it to recall that, according to settled case-law, given importance, both for the EU legal order and for the national legal systems, of the principle of res judicata, EU law does not require a national court to disapply domestic rules of procedure conferring finality on a judgment, even if to do so would make it possible to remedy a domestic situation which is incompatible with EU law. ( ) Accordingly, although it follows from the judgment in Lucchini that the decision of a national court which has become res judicata cannot be relied on in order to prevent the exercise of the exclusive competence of an EU institution, other than in that case there is no such obligation to disapply domestic rules.

94. Nonetheless, it is also clear from settled case-law that, if the applicable domestic rules of procedure provide the possibility, under certain conditions, for a national court to go back on a decision having the authority of res judicata in order to render the situation compatible with national law, that possibility must prevail if those conditions are met, in accordance with the principles of equivalence and effectiveness, so that the situation at issue is brought back into line with EU law. ( ) Again, it is a matter for the national court to determine whether there is such a possibility in the case before it and whether the conditions to which it is subject are fulfilled. ( )

95. On the basis of the foregoing considerations, the answer to the fourth question referred for a preliminary ruling should, in my view, be that Article 4(1) of the Framework Directive must be interpreted as meaning that an entity which has participated in an auction procedure organised by an NRA in accordance with Article 7 of the Authorisation Directive for the purpose of allocating rights of use of radio frequencies enjoys a right of appeal against the decisions which the NRA adopts in the context of that procedure, whether they are decisions addressed to that entity or, where the conditions laid down in Article 4(1) of the directive are met, decisions not directly addressed to it. The standing of an undertaking excluded from such a procedure to appeal against the final decision awarding radio frequencies is independent of the nature of the exclusion decision, be it final or otherwise, if it is established that that undertaking meets the conditions laid down in Article 4(1) of the Framework Directive.

IV. Conclusion

96. In the light of all the foregoing considerations, I suggest that the Court answer the questions referred by the Fővárosi Törvényszék (Budapest High Court, Hungary) for a preliminary ruling as follows:

(1) Article 4(1) of Directive 2002/21/EC of the European Parliament and of the Council of 7 March 2002 on a common regulatory framework for electronic communications networks and services is to be interpreted as meaning that:

acknowledgement of the status of “undertaking providing electronic communications services”, within the meaning of that provision, of an undertaking which satisfies the conditions to which the general authorisation referred to in the first sentence of Article 3(2) 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 is subject in the Member State to which the NRA that adopted the decision in question belongs is not precluded either by the fact that that undertaking is not yet present on the market of that Member State and is not yet registered there for the purposes of the second sentence of Article 3(2) of that directive, or by the fact that it does not currently provide electronic communications services, provided, however, that it demonstrates a real intention and a possibility, which is not merely theoretical, in terms of infrastructure and technology, of joining the market for those services in the Member State concerned. That status of “undertaking providing electronic communications services” may also be acknowledged for a legal person which, while not directly engaged in the provision of electronic communications services, is the holding company of a group which does provide such services;

in order to enjoy the right of appeal against an NRA decision under that provision, an undertaking providing electronic communications networks or services must demonstrate that the content of that decision is liable to have a direct, adverse effect on the rights which that undertaking enjoys under the EU legal order, in particular under the directives on electronic communications services. While that adverse effect need not necessarily be certain and current, it must nevertheless be likely to materialise with reasonable probability. An undertaking which falls within the concept of “undertaking providing electronic communications services”, within the meaning of Article 4(1) of Directive 2002/21, and which has made a bid to participate in a selection procedure for the award of rights of use of radio frequencies, must be regarded as “affected”, for the purposes of that provision, by the decision announcing the outcome of the selection procedure. Such an undertaking will not cease to be “affected” merely because it has been excluded from the procedure because it failed to satisfy the condition for admission of not having been found to have infringed the competition rules during a certain period of time preceding the commencement of the auction procedure;

an entity which has applied to participate in an auction procedure organised by an NRA in accordance with Article 7 of Directive 2002/20 for the purpose of allocating rights of use of radio frequencies enjoys a right of appeal against the decisions which the NRA adopts in the context of that procedure, whether they are decisions addressed to that entity or, where the conditions laid down in Article 4(1) of the directive are met, decisions not directly addressed to it. The standing of an undertaking excluded from such a procedure to appeal against the final decision awarding radio frequencies is independent of the nature of the exclusion decision, be it final or otherwise, if it is established that that undertaking meets the conditions laid down in Article 4(1) of that directive.

(2) An auction procedure conducted by an NRA in accordance with Article 7 of Directive 2002/20, and the decision of that authority announcing the outcome of that procedure, pursue the objective of safeguarding effective, undistorted competition.