Notice by the Commission concerning a draft directive on competition in the markets for electronic communications services (Text with EEA relevance)
Date: 2001-03-27
Institutions: European Commission
Subjects: competition law, electronic equipment, telecommunications, transmission network

C 96/2

EN

Official Journal of the European Communities

27.3.2001

Notice by the Commission concerning a draft directive on competition in the markets for elec-
tronic communications services

(2001/C 96/02)

(Text with EEA relevance)

The Commission approved a draft Commission Directive on competition in the markets for electronic
communications services.

The Commission intends to adopt the Directive after having heard the comments of all interested parties.

The Commission invites interested parties to submit their observations on the draft Directive published
below.

Observations must reach the Commission not later than two months following the date of this publication.
Observations may
e-mail:
Lambros.Papadias@cec.eu.int, or by post to:

the Commission by

(32-2) 296 98 19)

sent

(No

fax

by

be

to

European Commission
Directorate-General for Competition
Unit C1
Office J-70 2/271
Rue de la Loi/Wetstraat 200
B-1049 Brussel.

Draft Commission Directive on competition in the markets for electronic communications
services

THE COMMISSION OF THE EUROPEAN COMMUNITIES,

Having regard to the Treaty establishing the European
Community, and in particular Article 86(3) thereof,

Whereas:

for

(1) Commission Directive 90/388/EEC of 28 June 1990 on
competition in the markets
telecommunications
services (1) has been substantially amended several times,
95/51/EC (2), Directive
in
96/2/EC (3),
Directive
1999/64/EC (5). Since further amendments are to be
made, those Directives should be recast in the interests
of clarity. Directive 94/46/EC (6) should also be amended.

by Directive

96/19/EC (4)

particular

Directive

and

(2) Article 86 of the Treaty entrusts the Commission with the
task of ensuring that, in the case of public undertakings
and undertakings enjoying special or exclusive rights,
Member States comply with their obligations under
Community law. Pursuant to paragraph 3 of Article 86,
the Commission can specify and clarify the obligations
arising from that article and, in that framework, set out

(1) OJ L 192, 24.7.1990, p. 10.
(2) OJ L 256, 26.10.1995, p. 49.
(3) OJ L 20, 26.1.1996, p. 59.
(4) OJ L 74, 22.3.1996, p. 13.
(5) OJ L 175, 10.7.1999, p. 39.
(6) OJ L 268, 19.10.1994, p. 15.

conditions which are necessary
perform effectively

the
Commission
surveillance imposed upon it by that paragraph.

to allow the
of
duty
the

to

to

abolish

services

and mobile

(3) Directive 90/388/EEC on competition in the markets for
telecommunications services required Member States to
abolish special and exclusive rights for the provision of
telecommunications services, other than voice telephony,
radiocommunications.
satellite
Directive 94/46/EC required Member States
to also
abolish exclusive and special rights for the supply of
satellite services, other than voice telephony. Directive
all
95/51/EC required Member
States
restrictions on the supply of
transmission capacity by
cable television networks for the provision of telecom-
munications services, other than voice telephony. A year
later, Directive 90/388/EEC was once again amended by
Directive 96/2/EC which liberalised the mobile and
personal communications market. Full competition in
the
introduced by
Directive 96/19/EC which required Member States also
to abolish exclusive and special rights for the provision
of voice telephony and the establishment and provision of
telecommunications networks for the provision of tele-
communications services. Directive 1999/64/EC required
Member States to ensure that telecommunications under-
the
takings which are dominant
provision of public telecommunications networks and
public voice telephony services and operated a cable
television network established under special or exclusive
rights use different legal entities for the operation of their
telecommunications and cable television networks.

telecommunications market was

in the market

for

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Official Journal of the European Communities

C 96/3

in particular Directive 98/10/EC of

(4) A number of other directives in this field have also been
adopted under Article 95 of the Treaty by the European
Parliament and the Council aiming, principally, at
the
establishment of an internal market
for telecommuni-
cations services through the implementation of open
network provision and the provision of a universal
service in an environment of open and competitive
markets,
the
European Parliament and of the Council of 26 February
1998 on the application of open network provision (ONP)
to voice telephony and on universal service for telecom-
munications in a competitive environment (1), Directive
97/33/EC of
the
the European Parliament
Council of 30 June 1997 on interconnection in telecom-
munications with regard to ensuring universal service and
interoperability through the application of the principles
of open network provision (ONP) (2), as amended by
the
Directive
European Parliament and of the Council of 6 October
1997 amending Council Directives 90/387/EEC and
92/44/EEC for the purpose of adaptation to a competitive
in telecommunications (4), and Directive
environment
97/13/EC of
the
the European Parliament
Council of 10 April 1997 on a common framework for
general authorisations and individual licences in the field
of telecommunications services (5).

98/61/EC (3), Directive

97/51/EC of

and of

and of

maintained. For the sake of clarity, provisions which have
become obsolete should be deleted. Furthermore, certain
definitions used in those Directives have been amended in
order to reflect the latest technological developments in
in general. Finally, the wording of
telecommunications,
certain provisions should, where possible, be clarified in
order to facilitate their application, taking into account,
where appropriate, the relevant Directives adopted under
Article 95 of
the Treaty, and the experience acquired
through the implementation of Directives 90/388/EEC,
94/46/EC, 95/51/EC, 96/2/EC, 96/19/EC and 1999/64/EC.

and

services(cid:146)

(cid:145)electronic

(7) This Directive makes reference to (cid:145)electronic communi-
cations
communications
networks(cid:146) rather than the previously used terms (cid:145)telecom-
munications services(cid:146) and (cid:145)telecommunications networks(cid:146).
These new definitions are indispensable in order to take
account of
the convergence phenomenon which has
shaped the information technology, media and telecom-
munications industries over the last years by bringing
electronic
together under one
communications services and/or networks involved in
the transmission of electromagnetic signals (i.e.
fixed,
wireless, cable television, satellite networks).

single definition all

the Council,

the Economic

(5) In its (cid:145)1999 Communications Review(cid:146) to the European
Parliament,
and Social
Committee and the Committee of the Regions, entitled
(cid:145)Towards a new framework for electronic communications
infrastructure and associated services(cid:146) (6), the Commission
announced the adoption of a new legislative policy
framework for telecommunications aiming at promoting
and sustaining an open competitive European market for
electronic communications services. The stated aim was to
reduce the number of the existing legislative texts from 26
to six. Accordingly,
the Commission proposed the
adoption of one framework Directive identifying general
and specific policy objectives, and four specific Directives
concerning licensing, access and interconnection, universal
service, and privacy and data protection. Those Directives
would be based on Article 95 of the Treaty. In addition,
the Commission would consolidate and simplify Directive
90/388/EEC.

(6) In the light of the developments which have marked the
liberalisation process and the gradual opening of the tele-
communications markets in Europe since 1990, when
Directive 90/388/EEC was
first adopted, only those
provisions which are still necessary for attaining the
the Directives 90/388/EEC, 94/46/EC,
objectives of
95/51/EC, 96/2/EC, 96/19/EC and 1999/64/EC should be

(1) OJ L 101, 1.4.1998, p. 24.
(2) OJ L 199, 26.7.1997, p. 32.
(3) OJ L 268, 3.10.1998, p. 37.
(4) OJ L 295, 29.10.1997, p. 23.
(5) OJ L 117, 7.5.1997, p. 15.
(6) COM(1999) 539.

(8) In this context,

definition of

it should be made clear that Member
States must remove (if they have not already done so)
exclusive and special rights for the provision of all elec-
tronic communications networks, not just those for the
provision of electronic communications services, although
this Directive does not alter the scope of application of
electronic
Directive 90/388/EEC. The
communications networks also implies
that Member
States should not restrict
the right of an operator to
establish and/or provide a cable network on the ground
that such network could also be used for the transmission
of television signals. This is, however, without prejudice to
in
the specific rules adopted by the Member States
accordance with Community law, and,
in
in particular,
accordance with Council Directive 89/552/EEC of 3
October 1989 (7), on the
certain
provisions laid down by law, regulation or administrative
action in Member States concerning the pursuit of
television
by
Directive 97/36/EC of the European Parliament and of
the Council (8), governing the distribution of audiovisual
programmes intended for the general public.

coordination of

broadcasting

activities,

amended

as

(9) The possibility for Member States with less developed
networks to obtain a derogation for up to five years
from the
previously
liberalisation
full
provided for in paragraph 2,
fourth subparagraph, of
Article 2 of Directive 90/388/EEC should be deleted
since [. . .] no such derogation is still in force.

obligation,

(7) OJ L 298, 17.10.1989, p. 23.
(8) OJ L 202, 30.7.1997, p. 60.

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Official Journal of the European Communities

27.3.2001

supported by Directive [. . .] of

(10) On the basis of the principle of proportionality, Member
States should no longer make the provision of electronic
communications services, including the provision of voice
telephony, and the establishment and provision of elec-
tronic communications networks subject to a licensing
regime. This
the
is
European Parliament and of
the Council, according to
which electronic communications services or networks
should be provided on the basis of an authorisation and
not on the basis of a licence. An aggrieved party should
have the possibility to challenge a decision preventing him
from providing electronic communications services or
networks before an independent body and, ultimately,
is a fundamental
before a court or a tribunal.
It
is
an individual
principle of Community law that
entitled to effective judicial protection whenever a State
measure violates
rights conferred upon him by the
provisions of a Directive (1)

(11) Public authorities may exercise a dominant influence on
the behaviour of public undertakings as a result either of
the rules governing the undertaking or of the manner in
which the shareholdings are distributed. Therefore, where
Member States
control vertically integrated network
operators which operate networks which have been estab-
lished under special or exclusive rights, those Member
States should ensure that,
in order to avoid potential
breaches of the Treaty competition rules, such operators
do not discriminate in favour of their own affiliates, in
particular when attaching conditions to general authoris-
ations for mobile and personal communications systems.
Therefore, Member States
should take all measures
necessary to prevent any discrimination between such
vertically integrated operators and their competitors.

from that

time onwards such rights

(12) With regard to the rights of use of radio frequencies,
although Directive 96/2/EC did not
require Member
States to abolish exclusive or special rights of use of
it made it clear
radio frequencies existing at the time,
that
should be
allocated on objective and non-discriminatory criteria
and that the granting of licences issued for mobile and
personal communications systems should be limited only
on the basis of the need for effective use of the frequency
spectrum or
interference
the avoidance of harmful
between radio-based electronic communications systems
and other, space-based or terrestrial,
technical systems
and only where related to the lack of availability of
the
frequency
principle of proportionality. This Directive thus clarifies
the principle
derived from Directive 96/2/EC, by
providing that Member States should not grant exclusive
or special rights of use of radio frequencies. However,
rights of use of radio frequencies assigned according to
objective, non-discriminatory and transparent procedures

in conformity with

spectrum and

(1) See Cases C-70/95, Sodemare SA v Regione Lombardia [1997] ECR
I-3395, and 222/86, Unectef v Heylens and Others [1987] ECR 4097.

do not constitute special rights and they do not therefore
come within this prohibition.

up

setting

conventions

(13) To the extent that rights and obligations arising from
international
international
satellite organisations
compatible with the
are not
competition rules of the Treaty, Member States should
take all measures necessary to eliminate such incompati-
bilities. Under Article 3 of Directive 94/46/EC, Member
States were merely required to (cid:145)communicate to the
the information they possessed on such
Commission(cid:146)
incompatibilities. Article 11 of
this Directive aims to
strengthen the obligation on Member States to guarantee
the full liberalisation of the satellite markets by removing
any restrictions which could still be in force because of
those international conventions. This reflects the second
paragraph of Article 307 of the Treaty, which only applies
to agreements concluded by a Member State before 1
January 1958 (or,
for acceding Member States, before
accession). This provision does not apply to agreements
concluded by a Member State after that date, meaning
that if they are incompatible with the competition rules
of the EC Treaty, then Community law prevails. In the
interests of legal certainty, a Member State party to such
an agreement the terms of which are incompatible with
the competition rules of the Treaty should ensure that the
relevant provision is formally repealed.

(14) Finally, this Directive maintains the obligation imposed on
Member States by Directive 1999/64/EC to ensure that
dominant
communications
services operate their public electronic communication
network and cable television network under separate
legal entities.

electronic

providers

of

(15) For Member States which have correctly implemented
Directives 90/388/EEC, 94/46/EC, 95/51/EC, 96/2/EC,
96/19/EC and 1999/64/EC, the only additional obligations
imposed by this Directive are those set out in Article 11.
This Directive does not affect the obligations of Member
States concerning the deadlines for implementing and
applying the Directives set out in Annex I,

HAS ADOPTED THIS DIRECTIVE:

Article 1

Definitions

For the purposes of this Directive:

(cid:151) (cid:145)exclusive rights(cid:146) means the rights that are granted by a
Member State to one undertaking through any legislative,
regulatory or administrative instrument, reserving it
the
right to provide an electronic communications service, or
undertake an activity within a given geographical area,

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(cid:151) (cid:145)special rights(cid:146) means the rights that are granted by a
to a limited number of undertakings
administrative
legislative,

Member State
through any
instrument which, within a given geographical area,

regulatory or

in the establishment of radio-
consists, wholly or partly,
communications to a mobile user, and makes use wholly
or partly of mobile and personal communications systems,

(cid:151) designates or limits to two or more the number of such
undertakings
service or
authorised to provide
undertake an activity, otherwise than according to
objective, proportional and non-discriminatory criteria,
or

a

(cid:151) (cid:145)mobile and personal communications

systems(cid:146) means
systems consisting of the establishment and operation of
a mobile network infrastructure whether connected or not
to public network termination points, to support the trans-
mission and provision of radiocommunications services to
mobile users,

legal or

(cid:151) confers on undertakings, otherwise than according to
regulatory advantages which
such criteria,
substantially affect the ability of any other undertaking
to provide the same electronic communications service
or
same
same
geographical
equivalent
conditions,

to undertake
area

activity in the

substantially

under

the

and

other

switching or

resources which permit

(cid:151) (cid:145)electronic communications network(cid:146) means transmission
routing
systems and, where applicable,
equipment
the
conveyance of signals by wire, by radio, by optical or by
any other electromagnetic means. It covers inter alia satellite
networks,
including
fixed (circuit- and packet-switched,
Internet) and mobile terrestrial networks, networks used
for radio and television broadcasting, and cable television
networks, irrespective of the type of information conveyed,

(cid:151) (cid:145)public communications network(cid:146) means an electronic
communications network used inter alia for the provision
of public electronic communications services,

(cid:151) (cid:145)electronic

communications

services(cid:146) means

services
provided for
remuneration which consist wholly or
mainly in the transmission and routing of signals on elec-
tronic communications networks. It covers inter alia tele-
in
communications
networks used for broadcasting. It does not cover services
providing or exercising editorial control over, content trans-
mitted using electronic communications networks and
services,

services and transmission services

(cid:151) (cid:145)public electronic communications services(cid:146) means elec-
tronic communications services available to the public,

(cid:151) (cid:145)network termination point(cid:146) means all physical connections
and their technical access specifications which form part of
a public communications network and are necessary for
communication through that
access
public network,

to and efficient

(cid:151) (cid:145)satellite earth station network(cid:146) means a configuration of
two or more earth stations which inter-work by means of
a satellite,

(cid:151) (cid:145)mobile and personal communications

services(cid:146) means
than satellite services whose provision

services other

(cid:151) (cid:145)voice telephony(cid:146) means the commercial provision for the
public of the direct transport and switching of speech in
real-time between public switched network termination
points, enabling any user to use equipment connected to
such a network termination point in order to communicate
with another termination point,

(cid:151) (cid:145)cable television networks(cid:146) means any mainly wire-based
the
infrastructure
delivery or distribution of radio or television signals to
the public.

approved by a Member State

for

Article 2

Exclusive and special rights for electronic communications
networks and electronic communications services

the establishment and/or

1. Member States shall not grant exclusive or special rights
for
the provision of electronic
communications networks, or for the provision of electronic
communications services.

2. Member States shall take all measures necessary to ensure
that any undertaking is entitled to provide electronic communi-
cations services or
to establish or provide the electronic
communications networks.

3. Member States
shall ensure that no restrictions are
imposed or maintained on the provision of
electronic
communications
services over
communications
networks established by the providers of electronic communi-
cations services, over infrastructures provided by third parties,
and by means of sharing networks, other facilities or sites.

electronic

4. Member States shall ensure that an authorisation granted
to an undertaking to provide electronic communications
services or to establish and/or provide electronic communi-
cations networks, as well as the conditions attached thereto
shall be based on objective, non-discriminatory, proportionate
and transparent criteria.

from providing

Reasons shall be given for any decision preventing an
5.
undertaking
communications
services or networks. Any aggrieved party should have the
possibility to challenge such a decision before an independent
body and ultimately before a court or a tribunal.

electronic

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Article 3

Vertically integrated public undertakings

In addition to the requirements set out in Article 2(2), Member
in attaching conditions to general authorisations for
States,
mobile and personal communications systems, shall ensure
that vertically integrated public undertakings which provide
electronic communications networks do not discriminate in
favour of their own activities.

Article 4

Rights of use of frequencies

to open, non-discriminatory,

1. Member States shall not grant exclusive or special rights
of use of radio frequencies. As far as frequencies are available,
Member States shall grant rights of use of radio frequencies
and transparent
according
procedures. Member States may restrict the granting of rights
of use for radio frequencies only on the basis of the need for
effective use of the frequency spectrum or the avoidance of
harmful interference between radio-based electronic communi-
cations systems and other, space-based or terrestrial, technical
systems and only where related to the lack of availability of
frequency spectrum and justified by the principle of propor-
tionality.

The designation of

2.
for electronic
communication services shall be based on objective criteria.
regular
Procedures must be transparent and published at
intervals.

radio frequencies

Article 5

Numbering

Member States shall ensure that all exclusive and/or special
rights as regards numbering are abolished and that adequate
numbers are available for all public electronic communications
services. In doing so, Member States shall ensure that numbers
are allocated in an objective, non-discriminatory, proportionate
and transparent manner.

Article 6

Directory services

natory criteria and shall be consistent with the principle of
proportionality. In particular, where undertakings provide elec-
tronic communications services as part of universal service
obligations, this shall be taken into consideration in calculating
any contribution to the net cost of univeral service obligations.

2. Member States shall communicate any scheme of
the
kind referred to in paragraph 1 to the Commission in order
to enable it to check the scheme’s compatibility with the Treaty
and in particular with Articles 87 and 88 thereof.

The Commission shall, no later than 1 January [. . .],
3.
review the situation in the Member States and assess in
particular whether the financing schemes in place do not
limit access
the
Commission will examine whether there are other methods
and make any appropriate proposals.

to the relevant markets.

In this case,

Article 8

Rights of way

1. Member States shall not discriminate between providers
of public electronic communications networks with regard to
the provision of such
the granting of rights of way for
networks.

is not possible due to the protection of

2. Where the granting of additional rights of way to under-
takings wishing to provide public electronic communications
networks
the
environment and town and country planning objectives,
Member States shall ensure access to existing facilities estab-
lished under rights of way which may not be duplicated, on
reasonable terms.

Article 9

Independent national regulatory authorities

Member States shall ensure that the control of type approval
and mandatory specifications,
frequencies,
numbers as well as the surveillance of usage conditions as
well as any other regulatory functions are carried out by a
body independent of a public undertaking providing electronic
communications services and/or networks.

the allocation of

Member States shall ensure that all exclusive and/or special
rights with regard to the establishment and provision of
directory services, including both the publication of directories
and directory enquiry services, on their territory are abolished.

Article 10

Accounting separation

Article 7

Universal service obligations

1.
Any national scheme which is necessary to share the net
cost of the provision of universal service obligations imposed
in whole or
to
Directive [. . .], shall be based on objective and non-discrimi-

in part on public undertakings pursuant

in the authorisation schemes for the
Member States shall,
provision of public electronic communications networks and
services, at
least ensure that where such authorisation is
granted to undertakings to which they also grant special or
exclusive rights in areas other than electronic communications
services, such undertakings keep separate financial accounts as
concerns activities as providers of voice telephony and/or
networks and other activities, as soon as they achieve a
turnover of more than EUR 50 million in the relevant elec-
tronic communications market.

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Article 11

Satellites

that

shall

ensure

1. Member
States
any
regulatory
space segment
restriction on the offer of
prohibition or
capacity to any authorised satellite earth station network
operator are abolished, and shall authorise within their
territory any space-segment
the
satellite earth station network for use in connection with the
space segment of the supplier in question is in conformity with
the published conditions for access to his space segment
capacity.

to verify that

supplier

setting up international

States which are party

2. Member
international
satellite organisations
conventions
shall, to the extent that such conventions are not compatible
with the competition rules of the EC Treaty, take all appro-
priate steps to eliminate such incompatibilities.

to

Article 12

Cable networks

1.
Each Member State shall ensure that no undertaking
providing public communications networks operates its cable
television network using the same legal entity as it uses for its
other public electronic communications network, when such
undertaking:

(a) is controlled by that Member State or benefits from special

rights; and

(b) is dominant in a substantial part of the common market in
communications

the
networks and/or public voice telephony services; and

electronic

provision

public

of

(c) operates a cable television network which has been estab-
in the same

special or exclusive right

lished under
geographic area.

this
The Commission shall review the application of
2.
Article when it considers
this
the requirements of
that
Article have been complied with and the objectives pursued
attained, and, in any case, not later than [1 January . . .].

there is sufficient
3. Member States which consider that
competition in the provision of local loop infrastructure and
services
inform the Commission
accordingly.

territory,

in their

shall

Such information must include a detailed description of the
market structure. The information provided shall be made
available to any interested party on demand, regard being
had to the legitimate interest of undertakings in the protection
of their business secrets.

4.
The Commission shall decide within a reasonable period,
after having heard the comments of these parties, whether the
obligation of legal separation may be ended in the Member
State concerned.

Article 13

Mobile and personal communications

1. Member States shall not refuse to authorise the operation
of mobile systems according to the DCS 1800 standard at the
latest after adoption of a decision of the European Radiocom-
munications Committee on the allocation of DCS 1800
frequencies.

2. Member States shall, subject to the provision set out in
paragraph 4, not refuse to authorise public access, including
systems operation on the basis of the DECT standard.

the combination of
3. Member States shall not restrict
in particular where multi-
mobile technologies or systems;
standard equipment
is available. When extending existing
rights of use for radio frequencies to cover such combinations
Member States shall ensure that such extension is justified in
accordance with the provisions of paragraph 4.

4. Member States shall adopt, where required, measures to
ensure the implementation of this Article taking account of the
requirement to ensure effective competition between operators
competing in the relevant markets.

Article 14

Repeal

The Directives and provisions listed in Annex I, Part A, are
hereby repealed, without prejudice to the obligations of the
Member States concerning the time limits for transposition
and for application set out in Annex I, Part B.

References to the repealed Directives shall be construed as
references to this Directive and shall be read in accordance
with the correlation table in Annex II.

Article 15

Member States shall inform the Commission no later than four
months after the entry into force of
the
measures taken to comply with it.

this Directive of

When Member States adopt these measures, they shall contain
a reference to this Directive or shall be accompanied by such
reference on the occasion of
their official publication. The
methods of making such reference shall be laid down by
Member States.

Article 16

This Directive shall enter into force on the 20th day following
that of its publication in the Official Journal of
the European
Communities.

Article 17

This Directive is addressed to the Member States.