CELEX: 62007CJ0424
Language: en
Date: 2009-12-03
Title: Judgment of the Court (Fourth Chamber) of 3 December 2009.#European Commission v Federal Republic of Germany.#Failure of a Member State to fulfil obligations - Electronic communications - Directive 2002/19/EC - Directive 2002/21/EC -Directive 2002/22/EC - Networks and services - National rules - New markets.#Case C-424/07.

Case C-424/07
      European Commission
      v
      Federal Republic of Germany
      (Failure of a Member State to fulfil obligations – Electronic communications – Directive 2002/19/EC – Directive 2002/21/EC – Directive 2002/22/EC – Networks and services – National rules – New markets)
      Summary of the Judgment
      Approximation of laws – Electronic communications networks and services – Regulatory framework – Directives 2002/19, 2002/21
            and 2002/22
      (European Parliament and Council Directives 2002/19, Art. 8(4), 2002/21, Arts 6 to 8(1) and (2), 15(3) and 16, and 2002/22,
            Art. 17(2))
      A Member State which adopts legal provisions which limit the discretion of the national regulatory authority (NRA) and do
         not comply with the consultation and consolidation procedures laid down in Articles 6 and 7 of Directive 2002/21 on a common
         regulatory framework for electronic communications networks and services, fails to fulfil its obligations under Article 8(4)
         of Directive 2002/19 on access to, and interconnection of, electronic communications networks and associated facilities, Articles
         6 to 8(1) and (2), 15(3) and 16 of Directive 2002/21 and Article 17(2) of Directive 2002/22 on universal service and users’
         rights relating to electronic communications networks and services.
      
      In carrying out their regulatory functions, the NRAs have a broad discretion in order to determine the need to regulate an
         electronic communications market according to each situation on a case-by-case basis. Under Article 15 of Directive 2002/21,
         in particular subparagraph 3 thereof, the NRAs are required to define the relevant markets in that sector in close collaboration
         with the Commission. In accordance with Article 16 of that directive, the NRAs then carry out the analysis of the markets
         thus defined and determine whether those markets are effectively competitive. If that is not the case, the NRA concerned imposes
         ex ante regulatory obligations on undertakings with significant market power on that market. Those articles relate to the
         electronic commutations sector in general and do not exclude new markets or any other markets from their scope.
      
      A national provision which expressly provides that new markets should not be regulated unless certain factors, such as the
         absence of sustainable competition on the market, show that it is necessary to do so, encroaches on the wide powers conferred
         on the NRA, preventing it from adopting regulatory measures appropriate to each particular case, and thus is not consistent
         with Article 16 of Directive 2002/21. The limitation of the NRA’s discretion which results from such a provision also necessarily
         affects its ability to define the market. The NRA will no longer be led to define the relevant markets in accordance with
         Article 15(3) of that directive, inasmuch as the markets identified in the annex to the Commission recommendation on relevant
         production and service markets within the electronic communications sector susceptible to ex ante regulation in accordance
         with Directive 2002/21 already fall within the definition of a new market established by the national legislation.
      
      Similarly, it is clear from Article 8(4) of Directive 2002/19 and Article 17(2) of Directive 2002/22 that the obligations
         imposed under those articles are based on the nature of the problem identified, and are proportionate and justified in the
         light of the objectives sent out in Article 8 of Directive 2002/21, and that it is for the NRAs to promote the regulatory
         objectives referred to in that article and, therefore, to balance those objectives when defining and analysing a relevant
         market susceptible to regulation. A national provision which gives priority to only one of those objectives, such as the objective
         of promoting effective investment in infrastructure and supporting innovation, in the analysis by the NRA of the need to regulate
         a new market infringes Article 8(4) of Directive 2002/19, Article 8(1) and (2) of Directive 2002/21 and Article 17(2) of Directive
         2002/22 and limits the NRAs discretion in a manner incompatible with those directives.
      
      A national provision which imposes conditions more restrictive than those laid down by that directive for analysing relevant
         markets susceptible to regulation, such as that which provides as a criterion, so that a new market may by way of exception
         be subject to ex ante regulation, that there be a risk of a long-term impediment to the development of sustainable competition
         on those markets, is also contrary to Article 16 of Directive 2002/21.
      
      Lastly, a national provision, which imposes a principle of non-regulation of new markets, limits the NRA’s discretion to subject
         new markets to definition and to market analysis. That necessarily involves a failure in certain circumstances to follow the
         procedures laid down in Articles 6 and 7 of Directive 2002/21, to which Articles 15(3) and 16(6) thereof refer with respect
         to the definition and analysis of the market.
      
      (see paras 55-56, 61, 64, 66, 78, 82-83, 86, 90-91, 93-94, 98-99, 105-106, 108, operative part)
JUDGMENT OF THE COURT (Fourth Chamber)
      3 December 2009 (*)
      
      (Failure of a Member State to fulfil obligations – Electronic communications – Directive 2002/19/EC – Directive 2002/21/EC – Directive 2002/22/EC – Networks and services – National rules – New markets)
      In Case C‑424/07,
      ACTION under Article 226 EC for failure to fulfil obligations, brought on 13 September 2007,
      European Commission, represented by G. Braun and A. Nijenhuis, acting as Agents,
      
      applicant,
      v
      Federal Republic of Germany, represented by M. Lumma, acting as Agent, and by Professor C. Koenig, and S. Loetz, Rechtsanwalt,
      
      defendant,
      THE COURT (Fourth Chamber),
      composed of K. Lenaerts, President of the Third Chamber, acting for the President of the Fourth Chamber, R. Silva de Lapuerta,
         E. Juhász, G. Arestis (Rapporteur), and T. von Danwitz, Judges,
      
      Advocate General: M. Poiares Maduro,
      Registrar: K. Sztranc-Sławiczek, Administrator,
      having regard to the written procedure and further to the hearing on 5 February 2009,
      after hearing the Opinion of the Advocate General at the sitting on 23 April 2009,
      gives the following
      Judgment
      1        By its application, the Commission of the European Communities seeks a declaration that, by adopting Paragraphs 3(12b), and
         9a of the Law on Telecommunications, of 22 June 2004, (Telekommunikationsgesetz, BGBl. 2004 I, p. 1190) (‘the TKG’), introduced
         by the Law amending the provisions on telecommunications (Gesetz zur Änderung telekommunidationsrechtlicher Vorschriften)
         of 18 February 2007 (BGBl. 2007 I, p. 106), the Federal Republic of Germany has failed to fulfil its obligations under Article
         8(4) of Directive 2002/19/EC of the European Parliament and of the Council of 7 March 2002 on access to, and interconnection
         of, electronic communications networks and associated facilities (Access Directive) (OJ 2002 L 108, p. 7), Articles 6 to 8(1)
         and (2), 15(3) and 16 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 (Framework Directive) (OJ 2002 L 108, p. 33), and Article 17(2)
         of Directive 2002/22/EC of the European Parliament and of the Council of 7 March 2002 on universal service and users' rights
         relating to electronic communications networks and services (Universal Service Directive) (OJ 2002 L 108, p. 51).
      
       Legal background
       Community law
      2        Article 8(4) of the Access Directive provides:
      
      ‘Obligations imposed in accordance with this Article shall be based on the nature of the problem identified, proportionate
         and justified in the light of the objectives laid down in Article 8 of [the Framework Directive]. Such obligations shall only
         be imposed following consultation in accordance with Articles 6 and 7 of that Directive.’
      
      3        In accordance with recital 27 in the preamble to the Framework Directive ‘[i]t is essential that ex ante regulatory obligations
         should only be imposed where there is not effective competition, i.e. in markets where there are one or more undertakings
         with significant market power, and where national and Community competition law remedies are not sufficient to address the
         problem. It is necessary therefore for the Commission to draw up guidelines at Community level in accordance with the principles
         of competition law for national regulatory authorities [“NRAs”] to follow in assessing whether competition is effective in
         a given market and in assessing significant market power. [NRAs] should analyse whether a given product or service market
         is effectively competitive in a given geographical area, which could be the whole or a part of the territory of the Member
         State concerned or neighbouring parts of territories of Member States considered together. An analysis of effective competition
         should include an analysis as to whether the market is prospectively competitive, and thus whether any lack of effective competition
         is durable. Those guidelines will also address the issue of newly emerging markets, where de facto the market leader is likely to have a substantial market share but should not be subjected to inappropriate obligations.
         The Commission should review the guidelines regularly to ensure that they remain appropriate in a rapidly developing market.
         [NRAs] will need to cooperate with each other where the relevant market is found to be transnational’.
      
      4        Recital 11 in the preamble to the Framework Directive states that ‘[i]n accordance with the principle of the separation of
         regulatory and operational functions, Member States should guarantee the independence of the [NRA or NRAs] with a view to
         ensuring the impartiality of their decisions. …’ 
      
      5        Article 1(1) of the Framework Directive states:
      
      ‘This Directive establishes a harmonised framework for the regulation of electronic communications services, electronic communications
         networks, associated facilities and associated services. It lays down tasks of [NRAs] and establishes a set of procedures
         to ensure the harmonised application of the regulatory framework throughout the Community.’
      
      6        Article 3(2) and (3) of that directive provides:
      
      ‘2.       Member States shall guarantee the independence of the [NRAs] by ensuring that they are legally distinct from and functionally
         independent of all organisations providing electronic communications networks, equipment or services. Member States that retain
         ownership or control of undertakings providing electronic communications networks and/or services shall ensure effective structural
         separation of the regulatory function from activities associated with ownership or control.
      
      3.       Member States shall ensure that [NRAs] exercise their powers impartially and transparently.’
      7        Under Article 6 of the Framework Directive:
      
      ‘Except in cases falling within Articles 7(6), 20 or 21, Member States shall ensure that where the [NRAs] intend to take measures
         in accordance with this Directive or the Specific Directives which have a significant impact on the relevant market, they
         give interested parties the opportunity to comment on the draft measure within a reasonable period. The [NRAs] shall publish
         their national consultation procedures. Member States shall ensure the establishment of a single information point through
         which all current consultations can be accessed. The results of the consultation procedure shall be made publicly available
         by the [NRA], except in the case of confidential information in accordance with Community and national law on business confidentiality.’
      
      8        Article 7 of the Framework Directive provides:
      
      ‘1.       In carrying out their tasks under this Directive and the Specific Directives, [NRAs] shall take the utmost account of the
         objectives set out in Article 8, including in so far as they relate to the functioning of the internal market.
      
      2.       NRAs shall contribute to the development of the internal market by cooperating with each other and with the Commission in
         a transparent manner to ensure the consistent application, in all Member States, of the provisions of this Directive and the
         Specific Directives. To this end, they shall, in particular, seek to agree on the types of instruments and remedies best suited
         to address particular types of situations in the market place.
      
      3.       In addition to the consultation referred to in Article 6, where a national regulatory authority intends to take a measure
         which:
      
      (a)       falls within the scope of Articles 15 or 16 of this Directive, Articles 5 or 8 of Directive 2002/19/EC (Access Directive)
         or Article 16 of Directive 2002/22/EC (Universal Service Directive), and
      
      (b)       would affect trade between Member States,
      it shall at the same time make the draft measure accessible to the Commission and the [NRAs] in other Member States, together
         with the reasoning on which the measure is based, in accordance with Article 5(3), and inform the Commission and other [NRAs]
         thereof. [NRAs] and the Commission may make comments to the national regulatory authority concerned only within one month
         or within the period referred to in Article 6 if that period is longer. The one-month period may not be extended.
      
      4.       Where an intended measure covered by paragraph 3 aims at:
      (a)       defining a relevant market which differs from those defined in the recommendation in accordance with Article 15(1), or
      (b)       deciding whether or not to designate an undertaking as having, either individually or jointly with others, significant market
         power, under Article 16(3), (4) or (5),
      
      and would affect trade between Member States and the Commission has indicated to the [NRA] that it considers that the draft
         measure would create a barrier to the single market or if it has serious doubts as to its compatibility with Community law
         and in particular the objectives referred to in Article 8, then the draft measure shall not be adopted for a further two months.
         This period may not be extended. Within this period the Commission may, in accordance with the procedure referred to in Article
         22(2), take a decision requiring the [NRA] concerned to withdraw the draft measure. This decision shall be accompanied by
         a detailed and objective analysis of why the Commission considers that the draft measure should not be adopted together with
         specific proposals for amending the draft measure.
      
      5.      The [NRA] concerned shall take the utmost account of comments of other [NRAs] and the Commission and may, except in cases
         covered by paragraph 4, adopt the resulting draft measure and, where it does so, shall communicate it to the Commission.
      
      …’
      9        Under the heading ‘Policy objectives and regulatory principles’, Article 8(1) and (2) of the Framework Directive provides:
      
      ‘1.      Member States shall ensure that in carrying out the regulatory tasks specified in this Directive and the Specific Directives,
         the [NRAs] take all reasonable measures which are aimed at achieving the objectives set out in paragraphs 2, 3 and 4. Such
         measures shall be proportionate to those objectives.
      
      Member States shall ensure that in carrying out the regulatory tasks specified in this Directive and the Specific Directives,
         in particular those designed to ensure effective competition, [NRAs] take the utmost account of the desirability of making
         regulations technologically neutral.
      
      …
      2.       The [NRAs] 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, 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;
      (c)       encouraging efficient investment in infrastructure, and promoting innovation, and
      (d)      encouraging efficient use and ensuring the effective management of radio frequencies and numbering resources.’
      10      Article 15 of the Framework Directive concerns the market definition procedure. Paragraph 3 thereof provides:
      
      ‘[NRAs] shall, taking the utmost account of the recommendation and the guidelines, define relevant markets appropriate to
         national circumstances, in particular relevant geographic markets within their territory, in accordance with the principles
         of competition law. [NRAs] shall follow the procedures referred to in Articles 6 and 7 before defining the markets that differ
         from those defined in the recommendation.’
      
      11      Article 16 of the Framework Directive which concerns the market analysis procedure provides:
      
      ‘1.       As soon as possible after the adoption of the recommendation or any updating thereof, [NRAs] shall carry out an analysis of
         the relevant markets, taking the utmost account of the guidelines. Member States shall ensure that this analysis is carried
         out, where appropriate, in collaboration with the [NRAs].
      
      2.       Where [an NRA] is required under Articles 16, 17, 18 or 19 of Directive 2002/22/EC (Universal Service Directive), or Articles
         7 or 8 of Directive 2002/19/EC (Access Directive) to determine whether to impose, maintain, amend or withdraw obligations
         on undertakings, it shall determine on the basis of its market analysis referred to in paragraph 1 of this Article whether
         a relevant market is effectively competitive.
      
      3.      Where [an NRA] concludes that the market is effectively competitive, it shall not impose or maintain any of the specific regulatory
         obligations referred to in paragraph 2 of this Article. In cases where sector specific regulatory obligations already exist,
         it shall withdraw such obligations placed on undertakings in that relevant market. An appropriate period of notice shall be
         given to parties affected by such a withdrawal of obligations.
      
      4.       Where [an NRA] determines that a relevant market is not effectively competitive, it shall identify undertakings with significant
         market power on that market in accordance with Article 14 and the [NRA] shall on such undertakings impose appropriate specific
         regulatory obligations referred to in paragraph 2 of this Article or maintain or amend such obligations where they already
         exist.
      
      5.       In the case of transnational markets identified in the Decision referred to in Article 15(4), the [NRAs] concerned shall jointly
         conduct the market analysis taking the utmost account of the guidelines and decide on any imposition, maintenance, amendment
         or withdrawal of regulatory obligations referred to in paragraph 2 of this Article in a concerted fashion.
      
      6.       Measures taken according to the provisions of paragraphs 3, 4 and 5 of this Article shall be subject to the procedures referred
         to in Articles 6 and 7.’
      
      12      Article 17(2) of the Universal Services Directive provides:
      
      ‘Obligations imposed under paragraph 1 shall be based on the nature of the problem identified and be proportionate and justified
         in the light of the objectives laid down in Article 8 of [the Framework Directive]. The obligations imposed may include requirements
         that the identified undertakings do not charge excessive prices, inhibit market entry or restrict competition by setting predatory
         prices, show undue preference to specific end-users or unreasonably bundle services. [NRAs] may apply to such undertakings
         appropriate retail price cap measures, measures to control individual tariffs, or measures to orient tariffs towards costs
         or prices on comparable markets, in order to protect end-user interests whilst promoting effective competition.’
      
      13      According to recital 15 in the preamble to the Commission Recommendation of 11 February 2003 on relevant product and service
         markets within the electronic communications sector susceptible to ex ante regulation in accordance with Directive 2002/21
         (OJ 2003 L 114, p. 45) (‘the Commission recommendation’), new and emerging markets, in which market power may be found to
         exist because of ‘first-mover’ advantages, should not in principle be subject to ex ante regulation.
      
      14      Paragraph 1 of the Commission recommendation provides:
      
      ‘In defining relevant markets in accordance with Article 15(3) of the [Framework Directive], [NRAs] are recommended to analyse
         the product and service markets identified in the Annex.’
      
      15      According to point 1 of the Commission’s guidelines for market analysis and assessment of significant market power under the
         Community regulatory framework for electronic communications networks and services (OJ  2002 C 165, p. 6) (‘the guidelines’):
      
      ‘These guidelines set out the principles for use by [NRAs] in the analysis of markets and effective competition under the
         new regulatory framework for electronic communications networks and services.’
      
      16      Paragraph 6 of the guidelines states:
      
      ‘These guidelines are intended to guide NRAs in the exercise of their new responsibilities for defining markets and assessing
         [significant market power]. …’ 
      
      17      In accordance with point 32 of the guidelines:
      
      ‘As far as emerging markets are concerned, recital 27 of the Framework Directive notes that emerging markets, where de facto the market leader is likely to have a substantial market share, should not be subject to inappropriate ex ante regulation.
         This is because premature imposition of ex ante regulation may unduly influence the competitive conditions taking shape within
         a new and emerging market. …’
      
       National legislation
      18      According to Paragraph 2(2) of the TKG, entitled ‘Regulation and objectives’:
      
      ‘The objectives of the regulation are as follows:
      1.       protecting the interests of users, particularly consumers, in the telecommunications sector, and telecommunications confidentiality;
      2.       guaranteeing fair competition and promoting sustainable competitive telecommunications markets for telecommunications networks
         and services together with associated facilities and services in both rural and urban areas;
      
      3.       encouraging effective investment in infrastructure and supporting innovation;
      4.       promoting the development of the internal market of the European Union;
      5.       guaranteeing the basic provision of telecommunications services at affordable rates throughout the territory (universal service);
      6.       promoting telecommunications services at the level of public institutions;
      7.       guaranteeing an effective use of frequencies free from interference, and taking account of the interests of radiobroadcasts;
      8.       ensuring efficient use of numbering resources,
      9.        protecting the interests of public safety.’
      19      According to Paragraph 3(12b) of the TKG, entitled ‘Definitions’:
      
      ‘A “new market” is a market for services or products which are significantly different from currently available services or
         products in terms of their effectiveness, their range, their availability for a large number of users (mass-market capacity),
         their price or their quality from the point of view of a knowledgeable buyer, and which do not simply replace those products…’
      
      20      Under Paragraph 9a of the TKG, entitled ‘New markets’:
      
      ‘1.       Save as provided for in the following paragraph, new markets shall not, in principle, be subject to regulation within the
         meaning of Part 2.
      
      2.       Where certain facts suggest that, in the absence of regulation, the development of a sustainable competitive market in the
         area of services or telecommunications networks would be hindered in the long term, the “Bundesnetzagentur” [German regulatory
         authority in the telecommunications sector] may, by way of derogation from subparagraph 1 above, submit a new market to regulation
         within the meaning of Part 2, in accordance with Paragraphs 9, 10, 11 and 12. In order to assess the need for regulation and
         in imposing specific measure, the “Bundesnetzagentur” shall take into particular account the objective of promoting efficient
         investment in infrastructure and of supporting innovation.’
      
       Pre-litigation procedure
      21      Following contacts between the Commission and the Federal Republic of Germany regarding the Commission’s reservations as to
         compatibility of the new provisions of the TKG with the common regulatory framework for electronic communications, the Commission,
         by letter of 26 February 2007, initiated the present infringement action under Article 226 EC, giving the Federal Republic
         of Germany formal notice to submit its observations within 15 days. At the request of that Member State that period was extended
         for a further 15 days.
      
      22      By letter of 28 March 2007, the Federal Republic of Germany submitted that the new provisions of the TKG were perfectly compatible
         with Community law.
      
      23      On 3 May 2007, the Commission issued a reasoned opinion calling on that Member State to take the measures necessary to comply
         with that opinion within one month from the date of its receipt. By letter of 4 June 2007, the Federal Republic of Germany
         defended its position and, on 5 June 2007, it submitted to the Commission an administrative provision from the Bundesnetzagentur,
         entitled ‘Principles of interpretation by the Bundesnetzagentur regarding Paragraph 9a of the TKG’.
      
      24      In those circumstances, the Commission decided to bring the present proceedings.
      
       The action
       Admissibility
       Arguments of the parties
      25      The Federal Republic of Germany takes the view that the present proceedings are inadmissible on the ground that the Commission
         neither initiated nor conducted the pre-litigation procedure correctly and did not respect its rights of defence.
      
      26      First, the Commission decided to initiate the infringement proceedings on 20 December 2006 when no national law existed which
         could have justified such an alleged infringement, since that law was published in the Budesgesetzblatt on 23 February 2007.
         Second, it is clear from the Commission’s attitude and, in particular, from its press releases, that it was determined to
         reject the arguments relied on by the Federal Republic of Germany without any examination whatsoever, and to bring proceedings
         before the Court as soon as possible. Such an attitude prevented that Member State from defending itself effectively during
         the pre-litigation procedure.
      
      27      The Federal Republic of Germany also claims that the action is inadmissible in so far as, in order to establish an infringement
         of the provisions of the relevant directives, the Commission should have used the procedure laid down in Article 7 of the
         Framework Directive which aims to consolidate decisions of the NRAs vis-à-vis the Commission. That provision provides for
         an independent procedure, having the same purpose as infringement proceedings, intended to ensure an application which is
         compatible and consistent with the common regulatory framework in all the Member States in order to allow the completion of
         the internal market in networks and communication services. 
      
      28      The Commission replies, first of all, that it sent the letter of formal notice to the Federal Republic of Germany after the
         publication of the contested law in the Bundesgesetzblatt. The Commission also points out that it is not required to wait
         for all the formalities provided for in national law before deciding to initiate infringement proceedings. 
      
      29      Next, the Commission takes the view that it examined the Federal Republic of Germany’s arguments during the pre-litigation
         procedure, but was unable to concur with them. In any event, that Member State did not mention the issue of admissibility,
         but challenged the substance of the proceedings. 
      
      30      Finally, the Commission submits that the Court has already held that the general power granted to the Commission under Article
         226 EC cannot be derogated from by a specific procedure laid down in a directive.
      
       Findings of the Court
      31      First, it must be observed that the new provisions of the TKG were published in the Budesgesetzblatt on 23 February 2007 and
         entered into force on the day after their publication. Although it is true that on 20 December 2006 the Commission authorised
         the commissioner responsible to initiate infringement proceedings against the Federal Republic of Germany, the fact remains
         that the proceedings were initiated against that Member State only by sending the letter of formal notice, on 26 February
         2007, after the publication and entry into force of the provisions concerned. Therefore, in any event, the alleged infringements
         preceded the sending of the letter of formal notice.
      
      32      Second, the Federal Republic of Germany submits that it is clear from the Commission’s attitude that it had decided to reject
         the arguments relied on by that Member State without any examination whatsoever. 
      
      33      In that connection, it must be observed, first of all, that it does not appear from the Commission’ press release of 26 February
         2007, to which the Federal Republic of Germany refers, that the Commission failed to respect the rights of the defence of
         the Member State concerned. The fact that the Commission announced the initiation of an expedited procedure against that Member
         State in that press release does not mean that the Commission intended to ignore the arguments that the Member State was going
         to put forward in the pre-litigation procedure. 
      
      34      Finally, it must be held, first, that the Federal Republic of Germany had an opportunity effectively to express its views
         during the pre-litigation procedure and, second, that the Commission did in fact take into consideration the position defended
         by that Member State. It must be recalled that, in the letter of formal notice of 26 February 2007, the Federal Republic of
         Germany was called on to lodge observations within 15 days, which was subsequently extended to 1 month at the request of that
         Member State. The latter sent its response to the letter of formal notice on 28 March 2007. It is clear from the reasoned
         opinion, and particularly from paragraph 4 thereof entitled ‘Germany’s arguments and the Commission’s reply’, that the Commission
         duly took account of the arguments put forward by that Member State in its response to the letter of formal notice. 
      
      35      In those circumstances, the complaint alleging an infringement of the rights of defence must be rejected. In so far as it
         is asserted that the Commission incorrectly analysed the Federal Republic of Germany’s response to the letter of formal notice,
         it must be recalled that even if that assertion were well founded, it would not constitute a ground of inadmissibility but
         a factor which the Court must, where appropriate, take into account in the assessment of the substance of the case (Case C-148/05
         Commission v Ireland [2007] ECR I-82, paragraph 39).
      
      36      Third, as regards the argument that the Commission should have used the procedure provided for in Article 7 of the Framework
         Directive in order to establish an infringement of the provisions of the directives concerned, it must be recalled that special
         procedures in a directive can neither derogate from nor replace the powers of the Commission under Article 226 EC (see, in
         particular, Case C-359/93 Commission v Netherlands [1995] ECR I-157, paragraph 13).
      
      37      It is clear from the foregoing considerations that the action must be declared admissible.
      
       Substance
      38      In support of its action, the Commission relies essentially on two complaints. The first alleges that the Federal Republic
         of Germany, in violation of Articles 8(1) and (2), 15 and 16 of the Framework Directive, Article 8(4) of the Access Directive
         and Article 17(2) of the Universal Service Directive, limited the discretion of the NRAs by defining the concept of ‘new markets’
         in the new provisions of the TKG, by laying down in them the principle of non-regulation of those markets, by imposing more
         restrictive conditions in them than those provided for by the common regulatory framework when, exceptionally, those markets
         may be subject to regulation, and by giving priority to a specific regulatory objective in the analysis of those markets.
         The second complaint alleges failure to comply with the consultation and consolidation procedures laid down in Articles 6
         and 7 of the Framework Directive.
      
      39      The Federal Republic of Germany contests the allegation that it has failed to fulfil its obligations. 
      
       The complaint alleging the limitation of the discretion of the NRA
       Arguments of the parties
      40      The Commission claims that the new rules introduced by Articles 3(12b) and 9a of the TKG limit the discretion of the NRA.
         Those provisions circumvent the definition and market analysis procedures and those imposing corrective regulatory measures
         which were put in place by the common regulatory framework on electronic communications.
      
      41      By adopting Paragraphs 3(12b) and 9a of the TKG, the German legislature has defined the concept of ‘new markets’, has laid
         down the principle of non-regulation of those markets, has fixed in advance the restrictive conditions under which the NRA
         is authorised, by way of exception, to regulate them, and has required it to give priority to a specific regulatory objective.
         Those provisions of the TKG are contrary to the provisions of the Community regulatory framework which concern the whole range
         of the NRA’s powers, such as Article 8 of the Access Directive, Articles 8, 15 and 16 of the Framework Directive and Article
         17 of the Universal Service Directive.
      
      42      The Commission takes the view, first of all, that, by defining the ‘new markets’, Paragraph 3(12b) of the TKG limits the discretion
         of the German NRA laid down by Article 15(3) of the Framework Directive. Under that provision, the NRAs are to define relevant
         markets appropriate to national circumstances, in particular relevant geographic markets within their territory, in accordance
         with the principles of competition law.
      
      43      Next, the Commission submits that contrary to the definition and market analysis procedures laid down by the common regulatory
         framework, Paragraph 9a(1) of the TKG provides that, in principle, the new markets are not subject to ‘regulation’ within
         the meaning of Part 2 of the TKG. 
      
      44      Furthermore, the Commission points out that where Paragraph 9a(2) of the TKG provides that a new market is, by way of exception,
         to be subject to regulation, the conditions laid down for that purpose are more restrictive than those in Article 16 of the
         Framework Directive. The latter article only requires the absence of effective competition in the relevant market and not,
         as Paragraph 9a(2) provides, a long-term impediment to the development of a sustainable competitive market. 
      
      45      Finally, in the Commission’s opinion, Paragraph 9a(2) of the TKG infringes Article 8(1) and (2) of the Framework Directive.
         That provision specifically emphasises a single regulatory objective, namely the promotion of effective investment in infrastructure
         and support for innovation. However, Article 8(2) of the Framework Directive does not establish a hierarchy for those objectives
         and Article 8(4) of the Access Directive and Article 17(2) of the Universal Service Directive clearly state that the NRAs
         are to impose corrective measures which are proportionate and justified in the light of the objectives in Article 8 of the
         Framework Directive, without giving particular priority to one of the objectives.
      
      46      The Federal Republic of Germany takes the view that Paragraphs 3(12b) and 9a of the TKG are compatible with the common regulatory
         framework for electronic communications networks.  
      
      47      That Member State contends that the directives in the regulatory framework are designed to harmonise the laws of the Member
         States and, therefore, allow them enough flexibility to define the abstract concepts used by those directives and to ensure
         the effectiveness of the objectives to which they refer. The Commission’s complaints are based on a very broad interpretation
         of the regulatory framework for telecommunications and on an incorrect assessment of the effects of the provisions of the
         TKG. 
      
      48      The Federal Republic of Germany notes that Paragraphs 3(12b) and 9a of the TKG effect a pre-structuring of the NRA’s discretion,
         seeking to ensure greater legal certainty, in accordance with the objectives of Article 4 of the Framework Directive. The
         Commission does not indicate in that regard which provision of the directives in the common regulatory framework for electronic
         communications points to the existence of such a discretion nor, in any event, which provision of the TKG limits that discretion.
         The use of the word ‘may’ in Paragraph 9a(2) of the TKG shows that the NRA must use its discretion in examining the need to
         regulate a new market. The Commission therefore requires a literal transposition of the provisions of those directives, as
         if it were a regulation, thus tending toward standardisation rather than towards a harmonisation of the laws of the Member
         States.
      
      49      According to the Federal Republic of Germany, it is clear from recital 27 in the preamble to the Framework Directive, point
         32 of the guidelines and recital 15 in the preamble to the Commission recommendation that, as a general rule, new markets
         should not be subject to ex ante regulation. In that connection, Paragraph 9a of the TKG does not have the effect of introducing
         a new free-standing verification procedure but sets out, with respect to new markets, the provisions relating to the general
         regulatory procedure for the markets laid down in Paragraphs 10 and 11 of the TKG. Thus, the need to regulate a market is
         examined in every case, but the adoption of regulatory measures by the NRA is excluded, by virtue of Paragraph 9a(1) of the
         TKG, where such a need has not been identified.
      
      50      As regards the definition of the relevant market, the Federal Republic of Germany states that the common regulatory framework
         does not preclude rules on definition of the market from the national legislature. It notes that, in any event, Paragraph
         3(12b) of the TKG does not constitute a definition of market, but sets out abstract criteria which, once the market has been
         defined, make it possible to determine whether of not it is a new market. Thus, Paragraphs 3(12b) and 9a of the TKG enable
         the NRA to define, on a case-by-case basis, the relevant market in accordance with the principles of competition law and do
         not lead to a divergence from the usual procedure for the definition of a market.
      
      51      Furthermore, the Federal Republic of Germany submits that the criterion for a sustainable competitive market and the requirement
         of a long-term impediment in the relevant market, laid down in Paragraph 9a(2) of the TKG, are not more restrictive conditions
         than those imposed by the directives on the common regulatory framework and do not alter the definition and analysis resulting
         from Paragraphs 10 and 11 of the TKG. They are conditions recognised in recital 27 in the preamble to the Framework Directive
         and in the Commission recommendation, which explain the notion of effective competition in the context of new markets. 
      
      52      Lastly, that Member State takes the view that the national legislature may, by virtue of the latitude allowed to it, focus
         on one of the regulatory objectives recognised in the directives in the common regulatory framework for electronic communications.
         The use of the expression ‘in particular’ in the second sentence of Paragraph 9a(2) of the TKG indicates, further, that the
         objective which is mentioned therein is not the only one to be taken into consideration.
      
       Findings of the Court
      53      As a preliminary point, it must be observed that, in accordance with Article 1(1) of the Framework Directive, that directive
         establishes a harmonised framework for the regulation of electronic communications services, electronic communications networks,
         associated facilities and associated services. It lays down tasks of national regulatory authorities and establishes a set
         of procedures to ensure the harmonised application of the regulatory framework throughout the Community.
      
      54      Pursuant to Article 3(2) and (3) of the Framework Directive and recital 11 in its preamble, in accordance with the principle
         of the separation of regulatory and operational functions, Member States must guarantee the independence of the national regulatory
         authority or authorities with a view to ensuring the impartiality and transparency of their decisions. 
      
      55      The Framework Directive confers on the NRAs specific tasks for regulating the electronic communications markets. In accordance
         with Article 15 of the Framework Directive, and in particular paragraph 3 thereof, the NRAs are required, in close collaboration
         with the Commission, to define the relevant markets in the electronic telecommunications sector. 
      
      56      In accordance with Article 16 of the Framework Directive, the NRAs then carry out the analysis of the markets thus defined
         and determine whether those markets are effectively competitive. If a market is not effectively competitive, the NRA concerned
         imposes ex ante regulatory obligations on undertakings with significant market power. 
      
      57      Article 15(3) of the Framework Directive states that NRAs are to take the utmost account of the Commission recommendation
         and the guidelines for the purpose of defining the relevant markets. 
      
      58      Under Article 16(1) of that directive, they must also take the utmost account of the guidelines when carrying out the analysis
         of the relevant markets in order to determine whether they are to be subject to ex ante regulation.
      
      59      In carrying out their tasks, the NRAs are required, pursuant to Article 7(1) of the Framework Directive, to take the utmost
         account of Article 8 thereof. In accordance with Article 8(1) of that directive, Member States must ensure that the NRAs take
         all reasonable measures which are aimed at achieving the objectives set out in Article 8. Furthermore, that provision states
         that the measures taken by the NRA must be proportionate to those objectives. 
      
      60      In the same way, Articles 8(4) of the Access Directive and 17(2) of the Universal Service Directive provide that the NRAs,
         when they adopt ex ante regulatory obligations on the basis of those directives, must take account of the objectives laid
         down in Article 8 of the Framework Directive. The ex ante regulatory obligations must be proportionate and justified in the
         light of those objectives.
      
      61      In carrying out those regulatory functions, the NRAs have a broad discretion in order to be able to determine the need to
         regulate a market according to each situation on a case-by-case basis (see, to that effect, Case C-55/06 Arcor [2008] ECR I-2931, paragraphs 153 to 156).
      
      62      The merits of the present proceedings must be determined in the light of those considerations.
      
      63      First, the Court considers it appropriate to examine whether, as the Commission claims, the Federal Republic of Germany has
         failed to fulfil its obligations under Article 16 of the Framework Directive, by imposing, in Paragraph 9a of the TKG, a principle
         of non-regulation of new markets.
      
      64      In that connection, it must be observed that, under Article 16 of the Framework Directive, the NRAs are to carry out an analysis
         of the relevant markets in accordance with Article 15 thereof, in order to determine whether those markets must be subject
         to ex ante regulation. Those articles relate to the electronic communications sector in general and do not exclude new markets
         or any other markets from their scope.
      
      65      Next, it must be recalled that Paragraph 9a(1) of the TKG states that, subject to subparagraph 2 thereof, new markets are
         not to be subject to regulation within the meaning of Part 2 of the TKG. In accordance with Paragraph 9a(2), where certain
         facts suggest that, in the absence of regulation, the development of a sustainable competitive market in the area of services
         or telecommunications networks would be hindered in the long term, the NRA may, by way of derogation from subparagraph 1,
         submit a new market to regulation within the meaning of  Part 2 of the TKG.
      
      66      The wording of Paragraph 9a(1) and (2) of the TKG expressly provides that new markets should not be regulated unless certain
         factors, such as the absence of sustainable competition on the market, show the need to regulate them. Thus, this general
         legal provision imposes, first of all in subparagraph 1, a principle of non-regulation of new markets, then provides, in subparagraph
         2 thereof, for exceptions to that principle.
      
      67      The Federal Republic of Germany contends that the principle of non-regulation of new markets forms part of the common regulatory
         framework for electronic communications. That Member State relies, in that respect, on recital 27 in the preamble to the Framework
         Directive, point 32 of the guidelines and recital 15 in the preamble to the Commission recommendation, according to which,
         as a general rule, new markets should not be subject to ex ante regulation.
      
      68      However, such an argument cannot be accepted.
      
      69      First of all, recital 27 in the preamble to the Framework Directive states that the guidelines will address the issue of new
         markets where de facto the market leader is likely to have a substantial market share but should not be subjected to inappropriate obligations.
         That recital envisages that the regulation of new markets is to take account of the specific characteristics of those markets.
         Consequently, such a provision cannot be understood as laying down a general principle of non-regulation of those markets.
      
      70      Next, according to point 32 of the guidelines, recital 27 in the preamble to the Framework Directive notes that emerging markets,
         where de facto the market leader is likely to have a substantial market share, should not be subject to inappropriate ex ante regulation.
         According to that provision of the guidelines, premature imposition of ex ante regulation may unduly influence the competitive
         conditions taking shape within a new and emerging market.
      
      71      Thus, that provision merely repeats the contents of recital 27 in the preamble to the Framework Directive by prohibiting the
         imposition of inappropriate ex ante obligations. Therefore, the guidelines do not lay down a general rule of non-regulation
         of new markets either. That finding is also confirmed by the wording of the last two sentences of point 32 of the guidelines,
         which state that foreclosure of emerging markets by the leading undertaking should be prevented and that NRAs should ensure
         that they can fully justify any form of early ex ante intervention.
      
      72      Finally, recital 15 in the preamble to the Commission recommendation notes that new and emerging markets, in which market
         power may be found to exist because of ‘first-mover’ advantages, should not in principle be subject to ex ante regulation.
         Such a provision envisages the non-regulation of new markets where, having regard to first mover advantages, there are undertakings
         with significant market power. Therefore, that provision calls, where necessary, for the verification by the NRA on a case-by-case
         basis of the necessary conditions for a finding that a new market does not require regulation.
      
      73      It is clear from all the foregoing that, although recital 27 in the preamble to the Framework Directive, point 32 of the guidelines
         and recital 15 in the preamble to the Commission recommendation propose that, as regards the new markets, the NRAs should
         proceed cautiously, the fact remains that those provisions do not lay down any general principle of non-regulation with respect
         to those markets.
      
      74      It should be added that, in any event, as it is clear from paragraphs 53 to 61 of this judgment, the Framework Directive confers
         on the NRA, and not on the national legislature, the task of determining the need for regulation of the markets.
      
      75      In that connection, it must be observed that Articles 15 and 16 of the Framework Directive, which are expressly addressed
         to the NRAs, constitute the legal basis on which the guidelines and the Commission recommendation are founded, and that those
         two legal instruments serve as a guide for the NRAs when defining and analysing the relevant markets in order to determine
         whether they must be subject to ex ante regulation.
      
      76      According to point 1 of the guidelines, they set out the principles for use by NRAs in the analysis of markets and effective
         competition under the regulatory framework for electronic communications. Point 6 of the guidelines also states that they
         are intended to guide NRAs in the exercise of their new responsibilities for defining markets and assessing significant market
         power. 
      
      77      In accordance with point 1 of the Commission recommendation, NRAs are advised to analyse the product and service markets identified
         in the annex thereto before defining the relevant markets in accordance with Article 15(3) of the Framework Directive.
      
      78      Therefore, by laying down a legal provision, according to which, as a general rule, the regulation of new markets by the NRA
         is excluded, Paragraph 9a of the TKG encroaches on the wide powers conferred on the NRA under the Community regulatory framework,
         preventing it from adopting regulatory measures appropriate to each particular case. As it is clear from point 54 in the Advocate
         General’s Opinion, the German legislature cannot alter a decision of the Community legislature and cannot, as a general rule,
         exempt new markets from regulation.
      
      79      It follows that Paragraph 9a(1) of the TKG, by establishing a principle of non-regulation of new markets, is not compatible
         with Article 16 of the Framework Directive.
      
      80      Second, the Commission takes the view that, by defining the concept of ‘new market’ in Paragraph 3(12b) of the TKG, the Federal
         Republic of Germany has limited the discretion of the NRA and failed to fulfil its obligations under Article 15(3) of the
         Framework Directive. 
      
      81      In that connection, it must be observed that the procedure for defining markets laid down in Article 15 of the Framework Directive
         is intended to enable NRAs to carry out an analysis of the relevant market in accordance with Article 16 of that directive
         and, in particular, to verify whether certain undertakings present on the market concerned have significant market power.
         The definition of the market therefore constitutes the starting point for the competition analysis carried out pursuant to
         Article 16 of the Framework Directive.
      
      82       In that connection, it must be held that the definition of ‘new market’ in Paragraph 3(12b) of the TKG, which refers to ‘a
         market for services and goods’ does not constitute a definition of a relevant market within the meaning of Article 15(3) of
         the Framework Directive which might be the subject of a competition analysis under Article 16 of that directive. It follows
         that Paragraph 3(12b) of the TKG cannot be regarded as limiting the power to define the market, which is the responsibility
         of the NRA under Article 15(3) of the Framework Directive.
      
      83      However, it must be held that the limitation of the German NRA’s discretion as a result of Paragraph 9a(1) of the TKG necessarily
         affects the NRA’s ability to define the market. In that connection, it must be recalled that the Commission recommendation
         identifies, in an annex, the markets which must be the subject of an examination under Article 15(3) of the Framework Directive.
         Having regard to the principle of non-regulation of new markets in Paragraph 9a(1) of the TKG, the NRA will no longer find
         it necessary to define the relevant markets in accordance with Article 15(3) of the Framework Directive, since the markets
         identified in the annex to the Commission recommendation fall within the definition in Paragraph 3(12b) of the TKG.
      
      84      In those circumstances, Paragraph 9a(1) of the TKG is also incompatible with Article 15(3) of the Framework Directive. 
      
      85      Third, the Commission submits that Paragraph 9a(2) of the TKG establishes a hierarchy of the objectives laid down in Article
         8 of the Framework Directive, contrary to that provision. 
      
      86      According to Paragraph 9a(2) of the TKG, in order to assess the need for regulation and in order to impose measures, the NRA
         is to take account, in particular, of the objective of promoting effective investment in infrastructure and supporting innovation.
         The other objectives which are to be taken into consideration by the NRA are listed in Paragraph 2 of the TKG.
      
      87      The Federal Republic of Germany claims that the new amendments to the TKG carry out a pre-structuring of the NRA’s intervention
         on new markets. That Member State takes the view that, having regard to its freedom of action in transposing the common regulatory
         framework for electronic communications, it may give priority to one of the objectives recognised by the Framework Directive
         where there is a clear link between that objective and a certain type of market, as is apparent from the reasoning in the
         Commission recommendation.
      
      88      It must be recalled, in that connection, that, under Article 8(2) of the Framework Directive, the NRAs are to promote competition
         in the provision of electronic communications networks, electronic communications services and associated facilities and services,
         inter alia, by ensuring that users derive maximum benefit in terms of choice, price, and quality, ensuring that there is no
         distortion or restriction of competition in the electronic communications sector, encouraging efficient investment in infrastructure,
         promoting innovation, and encouraging efficient use and ensuring the effective management of radio frequencies and numbering
         resources.
      
      89      In accordance with Article 8(1) of the Framework Directive, the Member States must ensure that in carrying out the regulatory
         tasks specified in the Framework Directive and the Specific Directives, the NRAs take all reasonable measures which are aimed
         at achieving the objectives set out in Article 8.
      
      90      In addition, it is clear from Article 8(4) of the Access Directive and Article 17(2) of the Universal Service Directive that
         the obligations imposed under those articles are to be based on the nature of the problem identified, proportionate and justified
         in the light of the objectives set out in Article 8 of the Framework Directive.
      
      91      It is clear from those provisions that the NRAs are required to promote the regulatory objectives referred to in Article 8
         of the Framework Directive when carrying out the regulatory tasks specified in the common regulatory framework. Consequently,
         as noted by the Advocate General, in paragraph 64 of his Opinion, it is also for the NRAs, and not the national legislatures,
         to balance those objectives when defining and analysing a relevant market which may be susceptible to regulation. 
      
      92      In that context, the Court has interpreted Article 8 of the Framework Directive as placing 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 European level (see, Case C-380/05 Centro Europa 7 [2008] ECR I-349, paragraph 81, and Case C-227/07 Commission v Poland [2008] ECR I-0000, paragraph 63).
      
      93      A national provision such as Paragraph 9a(2) of the TKG, which gives priority to only one of the objectives recognised by
         the Framework Directive during the analysis by the NRA of the need to regulate a new market, gives a weighting to those objectives,
         even though such a weighting exercise is a matter for the NRA when carrying out the regulatory tasks assigned to it.
      
      94      It follows that Paragraph 9a(2) of the TKG, which gives priority to one particular regulatory objective, infringes Article
         8(4) of the Access Directive, Article 8(1) and (2) of the Framework Directive and Article 17(2) of the Universal Service Directive
         and limits the NRA’s discretion in a manner incompatible with those directives.
      
      95      Fourth, as regards the Commission’s criticism that Paragraph 9a(2) of the TKG imposes conditions which are more restrictive
         than those laid down by the Framework Directive for analysing the markets, it must be recalled that that provision states
         that where certain facts suggest that in the absence of regulation the development of a sustainable competitive market for
         telecommunications services or networks would be hindered in the long term, the NRA may, by way of derogation from Paragraph
         9a(1), subject a new market to ‘regulation’ within the meaning of Part 2 of the TKG, in accordance with the provisions of
         Paragraphs 9 to 12 thereof. 
      
      96      Thus, it is clear from Paragraph 9a(2) of the TKG that the NRA is required to analyse the need for regulation of new markets
         where there is a risk that the development of sustainable competition on that market will be hindered in the long term. 
      
      97      It must be recalled that, in accordance with Article 16 of the Framework Directive, the NRAs are required to determine whether
         the relevant markets are effectively competitive. If a market is not effectively competitive, the NRA concerned is to impose
         ex ante regulatory obligations on undertakings having significant market power. 
      
      98      The criteria laid down by Paragraph 9a(2) of the TKG for a new market, by way of exception, to be subject to ex ante regulation,
         that is the risk of a long-term impediment to the development of sustainable competition, are more restrictive than those
         in Article 16 of the Framework Directive, according to which ex ante regulation is justified merely if it is established that
         the relevant market is not effectively competitive.
      
      99      Accordingly, Paragraph 9a(2) of the TKG, by imposing conditions which are more restrictive than those laid down by the Framework
         Directive for analysing relevant markets susceptible to regulation, infringes Article 16 of the Framework Directive and limits
         the NRA’s discretion.
      
      100    It follows from the foregoing considerations that the complaint alleging limitation of the NRA’s discretion must be upheld.
      
       The complaint alleging infringement of the consultation and consolidation procedures provided for under Articles 6 and 7 of
            the Framework Directive
       Arguments of the parties
      101    The Commission submits that, under Paragraph 9a of the TKG, the NRA is require to follow the consultation and consolidation
         procedures only where it takes the view that ex ante regulation is necessary. Thus, the NRA may define and analyse a ‘market’
         within the meaning of Article 15(3) of the Framework Directive, and adopt a decision not to regulate it, in accordance with
         Article 16 of that directive, without following the procedures provided for by the common regulatory framework. 
      
      102    However, such a limitation on the consultation procedure is contrary to Articles 6 and 7 of the Framework Directive. The Commission
         submits that the Federal Republic of Germany, by taking the view that the obligation to follow those procedures exists only
         where an obligation to impose ex ante regulation is established, conflates the definition of the market and its identification
         as a market susceptible to regulation.
      
      103    The Federal Republic of Germany contends that it has already informed the Commission that, according to the interpretation
         criteria of the Bundesnetzagentur, the consultation and consolidation procedures for the new markets will be carried out in
         accordance with the requirements of the directives of the common regulatory framework for electronic communications.
      
      104    That Member State also takes the view that Paragraph 9a of the TKG ensures compliance with the consultation and consolidation
         procedures. First, that provision only applies in the context of the normal procedure for the definition and analysis of the
         market and, second, subparagraph 2 thereof assumes the existence of a market defined in the context of the market definition
         procedure in accordance with Paragraph 10(2) of the TKG, which complies with the principles of competition law. In that connection,
         the Federal Republic of Germany has wholly fulfilled its obligations in respect of consultation and consolidation arising
         from Articles 6 and 7 of the Framework. The Commission has not established any infringement of those obligations and bases
         the infringement complained of on mere presumptions. 
      
       Findings of the Court
      105    It must be observed that both Article 15(3) of the Framework Directive and Article 16(6) thereof refer, with respect to the
         definition and analysis of the market, to the procedures laid down in Articles 6 and 7 of that directive.
      
      106    In that connection, it has already been held that the principle of non-regulation of new markets provided for in Paragraph
         9a(1) of the TKG limits the discretion of the NRA under Articles 15(3) and 16 of the Framework Directive. The limitation of
         the NRA’s discretion to submit ‘new markets’ to a definition and to a market analysis necessarily involves a failure to comply
         in certain circumstances with the procedures provided for in Articles 6 and 7 of the Framework Directive. 
      
      107    Accordingly, the Commission’s second complaint must also be upheld.
      
      108    It follows from all of the foregoing considerations that, by adopting Paragraph 9a of the TKG, the Federal Republic of Germany
         has failed to fulfil its obligations under Article 8(4) of the Access Directive, Articles 6 to 8(1) and (2), 15(3) and 16
         of the Framework Directive and Article 17(2) of the Universal Service Directive.
      
       Costs
      109    Under Article 69(2) of the Rules of Procedure, the unsuccessful party is to be ordered to pay the costs if they have been
         applied for in the successful party’s pleadings. Since the Commission has applied for costs to be awarded against the Federal
         Republic of Germany, and the latter has been unsuccessful, the Federal Republic of Germany must be ordered to pay the costs.
      
      On those grounds, the Court (Fourth Chamber) hereby:
      1.      Declares that, by adopting  Paragraph 9a of the Law on Telecommunications (Telekommunikationsgesetz), of 22 June 2004, the
            Federal Republic of Germany has failed to fulfil its obligations under Article 8(4) of Directive 2002/19/EC of the European
            Parliament and of the Council of 7 March 2002 on access to, and interconnection of, electronic communications networks and
            associated facilities (Access Directive), Articles 6 to 8(1) and (2), 15(3) and 16 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 (Framework Directive), and Article 17(2) of Directive 2002/22/EC of the European Parliament and of the Council of
            7 March 2002 on universal service and users' rights relating to electronic communications networks and services (Universal
            Service Directive);
      2.      Orders the Federal Republic of Germany to pay the costs.
      [Signatures]
      * Language of the case: German.