WRITTEN QUESTION E-0151/98 by Cristiana Muscardini (NI) to the Commission (2 February 1998)

Subject: The Italian Government's attitude to liberalization of the telecommunications sector

In his reply of 24 April 1996 to Question 0801/96 ((OJ C 217, 26.7.1996, p. 115.)) Commissioner Van Miert said that the Italian Government had undertaken to award a licence to a third mobile and personal telephone operator using DCS 1800 technology 'not later than 1 January 1998'.

The tendering procedure for the award of that licence has yet to be opened.

The Italian Government gave the Wind and Picienne groups responsibility for conducting trails of DCS 1800 technology only after those groups had complained to the European authorities.

The Commission received assurances from the Italian Government that it would not grant licences for the use of DCS 1800 technology prior to the tendering procedure for the selection of the third mobile and personal telephone operator (Question 02120/96 of 20 March 1996).

In mid-December 1997 the Italian Ministry for Posts awarded Telecom Italia s.p.a the necessary licence for the commercial launch of the 'Fido' DECT service without conducting a tendering procedure.

Given the above, would the Commission state:

1. what action it intends to take, with a view to upholding the principle of fair competition in the mobile and personal telephone sector, to ensure that a licence is awarded to the third operator and that an appropriate period of time elapses before the two existing operators, TIM and OPI, launch their DCS 1800 services?

2. how it intends to tackle the issue of late implementation of Community directives by the Italian Government?

3. whether it would agree that the award of a licence to the public operator while it still held a monopoly only a few days prior to the liberalization of the market for telecommunications services was in breach of competition and market rules and tantamount to facilitating the consolidation of a dominant position?

Answer given by Mr Van Miert on behalf of the Commission (16 March 1998)

As the Honourable Member rightly points out, the Italian Government did announce that it would award a licence to a third mobile and personal telephone operator using 'digital cellular system' (DCS) 1800 technology in 1996, i.e. before the deadline of 1 January 1998 set by Commission Directive 96/2/EC of 16 January 1996 amending Directive 90/388/EEC with regard to mobile and personal communications ((OJ L 20, 26.1.1996. )). The Italian Government also promised that it would allow this operator to become established in the market before authorising the two 'pan-European digital cellular mobile system' (GSM) operators also to use the DCS 1800 technology.

However, the Italian Government did not keep to its timetable for selection of the third mobile operator. Article 2(4) of Directive 96/2/EC stipulates that Member States shall adopt, where required, measures to ensure effective competition between operators competing in the relevant market. The Commission will therefore examine the terms stipulated by the Italian Government in the tendering procedure ('gara') for the third operator in the light of this obligation.

With regard to the delay in opening the procedure for selecting the third operator, on 24 November 1997 the Commission reminded the Italian Government of its obligations and will initiate infringement proceedings under Article 169 of the EC Treaty if Italy does not comply with Directive 96/2/EC.

The launching of the DECT (Digital European Cordless Telecommunications) service by Telecom Italia just prior to the complete liberalisation of the Italian market does not in itself constitute a breach of the competition rules laid down in the EC Treaty. However, the circumstances in which the Italian Government authorised this launch, and in particular the lack of legal separation between Telecom and the division which supplies the DECT service, mean it is not possible to make sure that the dominant operator will not apply anti-competitive conditions to any competitors who would also like to offer this service. The Commission has therefore decided to begin proceedings in order to obtain greater transparency regarding the conditions under which Telecom's DECT service is provided.