European Commission v Federal Republic of Germany.
Date: 2009-12-03
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).
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).
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.
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.
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).