Amended proposal for a EUROPEAN PARLIAMENT AND COUNCIL DIRECTIVE amending Council Directives 90/387/EEC and 92/44/EEC for the purpose of adaptation to a competitive environment in telecommunications
Date: 1996-07-31
Institutions: European Commission
Subjects: competition law, harmonisation of standards, liberalisation of trade, telecommunications, transmission network

COMMISSION  OF THE EUROPEAN  COMMUNITIES 

* 

•is 

it 

à 

Brussels, 31.07.1996 
COM(96) 418 final 

95/0280  (COD) 

Amended  proposal  for  a 

EUROPEAN  PARLIAMENT  AND COUNCIL  DIRECTIVE 

amending Council Directives 90/387/EEC and 92/44/EEC for the purpose of 

adaptation to a competitive environment in telecommunications 

(presented  by the Commission  pursuant to Article  189 a (2) 
of the EC-Treaty) 

EXPLANATORY MEMORANDUM 

The  Commission  hereby  presents  a modified  proposal  for  a European Parliament 
and Council Directive amending Council Directives 90/387/EEC and 92/44/EEC for 
the  purpose  of  adaptation  to  a  competitive  environment  in  telecommunications. 
The modified  proposal  incorporates those amendments proposed  by the European 
Parliament at First Reading which were accepted by the Commission. 

1. 

Introduction 

a) 

Background 

The Commission adopted its proposal on 14.11.19951, and it was formally transmitted to 
the EP and the Council on 10.01.1996. 

The Economic and Social Committee gave a favourable Opinion on 25.04.19962. The 
European Parliament adopted a favourable Resolution at its First Reading on 
22.05.1996, and proposed 17 amendments to the Commission proposal3. 

b) 

Purpose of the Directive 

The aim of the Commission proposal  is to amend the two following existing ONP 
Directives: 

- the ONP framework Directive (90/387/EEC)4 

- the ONP leased lines Directive (92/44/EEC)5 

in order to adapt them to the post-1998 liberalised telecommunications market. 

The ONP framework Directive was adopted in 1990, and set out basic principles for 
harmonising conditions for access to, and use of,  public telecommunications networks 
and services. 

The ONP leased lines Directive was adopted in June 1992, and set out harmonised 
supply and usage conditions for leased lines, including a requirement for a minimum set 
of 5 types of leased lines to be available in all Member States 

2 
3 
4 
5 

COM(95) 543, OJ C 62,  1.03.1996, p. 3 
TRA/304, 25.04.1996 
A4-0144/96, PV 22.05.1996 
OJL  192, 24.07.1990, p. 1 
OJL  165, 19.06.1992, p. 27 

2-

2. 

EP amendments accepted bv the Commission 

Of the 17 amendments adopted by the European Parliament at First Reading, the 
Commission accepted 3 in full,  3 in part, and 2 in principle, making a total of 8. 

Amendments accepted in full : 

Amendments accepted in part: 

?,  13, 17 

4,  10, 14 

Amendments accepted in principle : 

9, 19(part) 

The Commission accepted those amendments which: 

• 

• 

call  for  examination  before  the  year 2000  of  the  possibility  of  establishing  a 
European regulatory authority for telecommunications [Amendments 10 (part)]. 

support  the  need  to  review  before  the year 2000  the provisions  of these two 
ONP Directives in the light of the developments in the market [Amendments 10 
and 14 (parts)]. 

•  are coherent with other Directives, and in particular with the Common Position 
reached  on  the  proposed  Interconnection  Directive  [Amendments  2,  4(lst 
part)]. 

• 

improve the clarity of the text [Amendments 13 and 17]. 

In addition, the Commission accepted in principle the following amendments:: 

Amendment  9: The Commission  agrees with the concern  of the Parliament in 
terms of providing national regulatory authorities with all necessary resources to 
fulfil  their  mission  in  full  autonomy,  but  the  creation  of  legal  difficulties  for 
national  transposition  of such requirement  should be avoided.  For this reason, 
such a provision should be in a recital (recital 7), instead of an article. 

Amendment 19 (3rdpart):  The Commission can accept in principle the need for 
restructuring the ONP committee, but this should not be a legal requirement. 

3. 

Amendments not accepted bv the Commission 

The reasons which led the Commission not to accept a number of the amendments (or 
parts of them) proposed by the European Parliament are given below, where the 
amendments are grouped into 6 categories. 

- 3-

Changes  to definitions  and  concepts 
(Amendments  1, 3, 4 (2nd  part), 6 and  7) 

These amendments propose changes to definitions  and concepts which are inconsistent 
with other Directives in the telecommunications  sector, and in particular with the 
Common Position reached on the proposed Directive on interconnection in 
telecommunications6.  These would risk of reopening debates on issues, commonly 
agreed in the other Directives,  and in particular could endanger the political  agreement 
achieved on that Common Position and accepted by the Commission.  This would  also 
go against the Parliament's wish of consistency between all EC Directives in this field. 

In this category fall the definitions  of'universal service' (Amendment  3), 'essential " 
requirements' (Amendment 4, 2nd part on 'data protection') and 'interconnection' 
(Amendment 6).  Also fall in this category Amendments  1 and 7: the former  modifying 
the 'significant  market power' concept  agreed in the Interconnection Directive,  and the 
latter introducing the concept of'network interconnection point', which is a new  concept 
not defined  or included  in the Interconnection Directive. 

Directive on costing  and  financing  of universal  service 
(Amendment  8) 

The Interconnection Directive sets out a framework for costing and financing of 
universal service.  In addition, the Communication on universal  service for 
telecommunications7  announces a Commission Communication on costing and financing 
of universal  service by September  1996, which will provide guidelines to be used in 
assessing national  approaches to costing and financing universal  service.  Therefore,  the 
Commission does not share the need for a specific Directive on the costing and financing 
of universal  service. 

Review  of the  Directive 
(Amendments  10 and  14  (parts)) 

The Commission accepts the need to examine what provisions of the two  Directives 
(90/387/EEC  and 92/44/EEC)  should be adapted in the light of market developments, 
but such adaptation should be limited to these two  ONP Directives. 

The Commission considers inappropriate the requirement for further measures that can 
be proposed in the report for the full implementation of the aims of these Directives to 
take the form of a proposal for a single consolidated text,  as this would prejudge the 
need for such measures. 

6 
7 

OJC313, 24.11.1995, p. 7. 
COM(96) 73,  13.03.1996 

- 4-

Comitology 
(Amendment  19(lst and 2nd parts)) 

The Commission can not accept the replacement of Member States' by 'national 
regulatory authorities' proposed in the first paragraph of Amendment  19, as it goes 
against standard consultative committee procedures. 

The Commission neither accepts the second paragraph of Amendment 19, as there is 
already a specific mechanism for consultation with trade unions (i.e. the Joint Committee 
on Telecommunications). 

Applicability of the ONP Leased Lines Directive 
(Amendment 12) 

Amendment  12 would significantly reduce the scope of the Leased Lines Directive, as 
the fixed public telephone network is commonly used for provision of leased lines. 

Other amendments 
(Amendments 15,16 and 18) 

The Commission can not accept Amendments 15 (1st part) and 16: the former would be 
against standard provision in EC Directives, and the latter inconsistent with other ONP 
Directives. 

Although agreeing with the aim of Amendment 15 (2nd part) in terms of publication of a 
consolidated version, the Commission considers inappropriate that it constitutes a legal 
requirement. 

The Commission can neither accept Amendment 18, as 'net' cost is unclear and 
potentially too restrictive, excluding other costs which may be taken into account (e.g. 
general network costs). 

4. Conclusion 

The Commission has accepted 8 of the 17 amendments proposed by the European 
Parliament at First Reading either in whole, in part or in principle. 

In accordance with Article 189a paragraph 2 of the EC Treaty, the Commission amends 
its initial proposal, incorporating these amendments. 

- 5-

Modified  Proposal for a European Parliament and Council Directive 
amending Council Directives 90/387/EEC and 92/44/EEC 
for the purpose of adaptation to a competitive environment in  telecommunications 

Original text 

Amended text 

Recital 7 

(based on EP amendment 9) 

7. Whereas in conformity  with  the  principle of 
separation  of  regulatory  and  operational 
functions,  Member  States  should  guarantee 
the  independence  of  the  national  regulatory 
authority  or authorities,  and  ensure that  the 
national  regulatory  authority  or  authorities 
of each Member State will play à key role in 
regulatory 
the 
framework  set  out  in  relevant  Community 
legislation;  whereas  the  national  regulatory 
authorities should  have the necessary means 
to carry out fuliv the tasks assigned to them; 

implementation  of 

the 

7. Whereas in conformity  with  the principle of 
separation  of  regulatory  and  operational 
functions,  Member  States  should  guarantee 
the independence  of the  national  regulatory 
authority or  authorities, and  ensure that  the 
national  regulatory  authority  or  authorities 
of each Member State will play a key role in 
regulatory 
the 
framework  set  out  in  relevant  Community 
legislation;  whereas  the  national  regulatory 
authorities  should  be  in  possession  of  all 
terms  of 
necessary  resources,  both 
staffing,  expertise,  and  financial  means  to 
fulfil  their mission in full  autonomy: 

implementation  of 

the 

in 

ARTICLE 1(2) 

Article 2(3), first indent, of Directive 90/387/EEC 
(based on EP amendment 2) 

3.  -'telecommunications  services'  means 
services  whose  provision  consists 
wholly  or  partly  in  the  transmission 
and/or 
on 
telecommunications networks; 

routing 

signals 

of 

3.  -'telecommunications  services'  means 
services  whose  provision  consists 
wholly  or  partly  in  the  transmission 
and/or 
on 
telecommunications  networks,  with 
the exception of radio broadcasting or 
television; 

routing 

signals 

of 

ARTICLE 1(2) 

Article 2(6) of Directive 90/387/EEC 
(based on EP amendment 4) 

'essential requirements' means the non-
economic  reasons 
in  the  general 
interest  which  may  cause  a Member 
State  to  restrict  access  to  public 
telecommunications 
or 
public  telecommunications  services. 
These reasons are security of network 
operations,  maintenance  of  network 
integrity  and, 
in  justified  cases, 
interoperability  of  services  and  data 
protection. 

networks 

networks 

'essential requirements' means the non-
economic  reasons 
in  the  general 
interest  which  may  cause  a Member 
State  to  restrict  access  to  public 
telecommunications 
or 
public  telecommunications  services. 
These reasons are security of network 
operations,  maintenance  of  network 
integrity. 
the 
protection 
environment or town planning, and, in 
interoperability  of 
justified  cases, 
services and data protection. 

of 

ARTICLE 1(8) 

Article 8 of Directive 90/387/EEC 
(based on EP amendment 10) 

the 

functioning  of 

The Commission  shall  examine and report 
to  the  European  Parliament  and  to  the 
Council  on 
this 
Directive,  on  the first occasion  not  later 
than 31  December  1999.  The  report  shall 
be  based  inter  alia  on  the  information 
provided  by  the  Member  States  to  the 
Commission  and  to  the  ONP  Committee. 
Where necessary,  further measures can be 
proposed  in  the  report  for  adapting  this 
Directive, taking account of developments 
towards a fully competitive environment. 

the 

functioning  of 

The Commission  shall  examine and report 
to  the  European  Parliament  and  to  the 
Council  on 
this 
Directive,  on  the  first  occasion  not  later 
than 31  December  1999.  The  report shall 
be  based  inter  alia  on  the  information 
provided  by  the  Member  States  to  the 
Commission  and to  the  ONP  Committee. 
Where necessary, the report  shall examine 
what provisions of this Directive should be 
adapted in the light of the developments in 
the  market.  Further  measures  can  be 
in  the  report  for  . the  full 
proposed 
implementation  of 
the  aims  of  this 
Pirecfive;  jn  particular,  the  report  shajl 
examine  the  possibility  of  establishing  a 
European Regulatory Authority. 

-7-

ARTICLE 2(10)(b) 

Article 10(4) of Directive 92/44/EEC 
(based on EP amendment 13) 

4.  The national regulatory authority shall 
not  apply 
requirements  ,  of 
the 
paragraph  1  where  an  organisation 
does  not  have  significant  market 
power  in  respect  of  a  specific  leased 
line offering  in a specific  geographical 
area. 

4.  The national regulatory authority shall 
not  apply 
requirements  of 
the 
paragraph  1  where  an  organisation 
does  not  have  significant  market 
power  in respect  of  a  specific  leased 
line offering  in a specific  geographical 
the  market  power  of  an 
area, 
undertaking  being  defined  by  the 
provisions  of  European  Parliament 
on 
and  Council  Directive 
interconnection 
public 
telecommunications  networks  and 
public telecommunications  services  in 
the  context  of  Open  Network 
Provision (ONP). 

.... 

to 

ARTICLE 2(12) 

Article 14 of Directive 92/44/EEC 
(based on EP amendment 14) 

the 

functioning  of 

The Commission  shall  examine and report 
to  the  European  Parliament  and  to  the 
Council  on 
this 
Directive,  on  the first occasion  not  later 
than 31  December  1999.  The report  shall 
be  based  inter  alia  on  the  information 
provided  by  the  Member  States  to  the 
Commission  and  to  the  ONP  Committee. 
The  report  shall  include  an assessment  of 
the need for continuation of this Directive, 
taking account of developments towards a 
fully  competitive  environment.  Where 
necessary, 
further  measures  can  be 
proposed  in  the  report  for  adapting  this 
Directive, taking account  of developments 
towards a fully competitive environment. 

the 

functioning  of 

The Commission shall  examine  and report 
to  the  European  Parliament  and  to  the 
Council  on 
this 
Directive,  on  the first occasion  not  later 
than 31  December  1999.  The  report  shall 
be  based  inter  alia  on  the  information 
provided  by  the  Member  States  to  the 
Commission  and  to  the  ONP  Committee. 
The report  shall  include  an assessment  of 
the need for continuation of this Directive, 
taking account of developments towards a 
fully  competitive  environment.  Where 
necessary,  the  report  shall  examine  what 
provisions  of  this  Directive  should  be 
adapted in the light of the developments in 
the  market,  and  further  measures  can  be 
in  the  report  for  the  full 
proposed 
implementation  of 
this 
Directive. 

the  aims  of 

Annex 1(3), second  paragraph, fourth  indent 
(based  on EP amendment 17) 

tariffs  must be non-discriminatory and 
guarantee equality of treatment. 

- tariffs  must  be non-discriminatory and 
treatment,. 
equality  of 
restrictions  which  are 

guarantee 
except 
compatible with Community law. 

for 

ISSN 0254-1475 

COM(96) 418 final 

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