Update 23 Feb 2007: Today's Bundesgesetzblatt contains the Act amending the Telecommunications Act. Key provisions, including those relating to 'emerging markets' come into effect on 24 Feb 2007.

A separate T-REGS news item addresses today's development.

Update 15 Dec 2006: The Bundesrat has now voted the Bill. The next steps are: (a) forwarding the text to the President of the Federal Republic for signature to pass it into Law, and (b) its publication in the Bundesgesetzblatt.

Update 14 Dec 2006: The Bundesrat (Upper House of Parliament, representing the Länder) is now expected to debate the Bill on 15 Dec 2006 (item 74 on the agenda). The full text (in German) can be accessed by clicking clicking here. 

Update 30 Nov 2006: The Bill was voted today by the Bundestag (Lower House of Parliament). 

The parties that currently constitute the majority in the German Federal parliament (CDU/CSU and SPD) have agreed to make modifications to the Telecommunications Bill, a draft of which was approved by the Federal Government in May this year.

(see also the T-REGS news item of 17 May 2006 which addressed the previously adopted text).

The proposed amendments to the Telecommunications Act, which have been under intensive discussions within Germany and between the German authorities and the European Commission for well over a year, focus mainly on the regulatory approach to 'emerging markets' and on consumer issues.

It is with regard to the concept of 'emerging markets' that today's political agreement contains important modifications.

Modifications were agreed to Paragraph 9a of the Bill, which now reads as follows:

§ 9a (Regulierung neuer Märkte): 

(1) Vorbehaltlich des nachfolgenden Absatzes unterliegen neue Märkte grundsätzlich nicht der Regulierung nach Teil 2.

(2) Wenn Tatsachen die Annahme rechtfertigen, dass bei fehlender Regulierung die Entwicklung eines nachhaltigen wettbewerbsorientierten Marktes im Bereich der Telekommunikationsdienste oder -netze langfristig behindert wird, kann die Bundesnetzagentur einen neuen Markt abweichend von Absatz 1 nach den Bestimmungen der §§ 9, 10, 11 und 12 der Regulierung nach Teil 2 unterwerfen. Bei der Prüfung der Regulierungsbedürftigkeit und der Auferlegung von Maßnahmen berücksichtigt die Bundesnetzagentur insbesondere das Ziel der Förderung von effizienten Infrastrukturinvestitionen und die Unterstützung von Innovationen.

A new Paragraph (Paragraph 3, Nr. 12b) was also agreed and contains the definition of 'new markets':

§ 3 Nr. 12b - neu (Definition "neuer Markt"): "ein Markt für Dienste oder Produkte, die sich von den bislang vorhandenen Diensten oder Produkten hinsichtlich der Leistungsfähigkeit, Reichweite, Verfügbarkeit für größere Benutzerkreise (Massenmarktfähigkeit), des Preises oder der Qualität aus Sicht eines verständigen Nachfragers nicht nur unerheblich unterscheiden und diese nicht lediglich ersetzen".

The modifications have as a consequence that emerging markets are now more explicitly excluded from regulation (the new point 1 of Paragraph 9a affirms that: "in principle, new markets markets are not regulated" (economic regulation)).

IF there are facts that justify the assumption that, without regulatory intervention, (this is now stated explicitly) the development of a sustainable competition-oriented market for telecommunications services or networks would be hampered in the long-term, the Regulatory Authority can regulate according to Paragraphs 9, 10, 11 and 12 of the Telecommunications Act.

T-REGS Note: The previous draft approved by the Federal Government only contained a reference to regulation according to Paragraph 10, which pertains to market definition, whereas in the text that has now been agreed, potential regulation also refers to the market analysis (§ 11) and the consultation and consolidation procedures (§ 12) and the basic principles stipulated in Paragraph 9.

With regard to the verification as to whether a market should be regulated and concerning the regulatory remedies that can be imposed, the text makes no reference to the principle of proportionality. The only criteria are now promotion efficient infrastructure investment and the support of innovation.

The definition of 'new markets', which is new in the text adopted today, is as follows:

"A market for new services or products, which differ in a non-insignificant way with regard to their performance, reach, availability to larger user groups (capability to sell to mass market), price or quality, from the perspective of an intelligent customer and which are not a mere substitute thereof."

T-REGS Note: This new definition focuses on services (rather than on the underlying infrastructure), which addresses what was a key issue for the European Commission, but the new definition inserts new elements as well, which will be the subject of substantial debate going forward.

For a discussion of this important development, please contact This e-mail address is being protected from spam bots, you need JavaScript enabled to view it .

The Dutch Trade and Industry Appeals Tribunal (College van Beroep voor het Bedrijfsleven - CBB) has granted the appeals filed against the OPTA decisions of 14 Nov 2005 and 31 May 2006 relating to the wholesale markets for voice call termination on individual mobile networks. 

The Tribunal has proceeded to completely annul the OPTA decisions, which relate to the wholesale call termination charges of KPN Mobile/Telfort, Vodafone, T-Mobile, Orange and Tele2. This decision affects the entire programme of reductions of wholesale mobile call termination charges, including the reduction which came into effect on 1 July 2006. 

OPTA is directed to take new decisions with regard to the market for voice call termination on individual mobile networks (Market 16 of the European Commission's Recommendation on Relevant Markets Susceptible to Ex-Ante Regulation), taking into account the ruling of the Tribunal. 

Only the decision to grant the appeals has been published at this stage. It can be accessed (in Dutch) by clicking here. The full content and reasoning of the ruling will be sent to the parties and will be published within two weeks.

Update 28 August 2006: The European Commission’s letter has now been published. Pages 3-6 of the letter contain comments on the regulatory obligations proposed by the German regulatory authority BNetzA.

Key comments by the European Commission in its letter SG-Greffe(2006)D/204686 include the following:

Scope of the access obligation

The European Commission welcomes that the access obligation includes bitstream over all variants of infrastructure, including ADSL2, ADSL2+, SDSL and VDSL “unless they are not substitutes to other bitstream access products”, and goes on to comment:

"[…] Against this background and in order to provide regulatory certainty the Commission finds it appropriate for BNetzA to set out explicitly that remedies in the present case also relate to the VDSL network. In view of the VDSL-based retail products that DT has recently launched, such an application of remedies should no longer be postponed.” and […] the Commission has at present no indication of a lack of substitution between VDSL and other xDSL products, whether at retail or at wholesale level. It is recalled in particular that a mere upgrade of an existing service (such as an offering with a higher bandwidth) is not considered in itself to constitute a new market. The Commission hence considers that the question about the substitutability between bitstream access to VDSL connections and other forms of bitstream access should be answered positively from the outset. Excluding DT’s VDSL-based infrastructure from the access obligation would jeopardise the effectiveness of that obligation to the detriment of competition in the downstream market and of the consumer. […]"

Stand alone bitstream access

The letter also reveals that the European Commission asked BNetzA to confirm whether “stand-alone bitstream access” (i.e. wholesale “naked-DSL”, the ability to obtain wholesale broadband access without a requirement for the end-user to have a PSTN/ISDN subscription from Deutsche Telekom) would be mandated, and that BNetzA replied that this would be introduced “in parallel with the European harmonised development”.

The European Commission comments on this as follows:

"The Commission asks BNetzA to impose this remedy without delay in order to enable competitors to offer broadband connections to end customers without an obligation to buy a telephone connection from DT. This would stimulate competition in particular in rural areas less susceptible to local loop unbundling, where competition on the retail services is particularly weak in Germany. Such an offer will also provide an adequate means to increase competition in the retail voice markets via Voice over IP."

Effective price regulation

The European Commission criticises BNetzA’s lack of clarity in its approach to wholesale charge regulation for bitstream access, rejects benchmarking as a means to set the wholesale charges, and concludes its comments on this issue as follows:

"[…] the Commission asks BNetzA to impose either retail minus or cost-oriented price control. If BNetzA chooses cost-orientation, it is invited, in order to increase transparency, to communicate to the market players a cost model on which cost-orientation will be based."

The European Commission’s letter also contains information and comments on the number of points of connection/access (confirmation that the competitors can freely choose the points and are not obliged to interconnect at all points) and insists that BNetzA should swiftly notify its proposals for ATM bitstream access. 

T-REGS Note: It will be seen from the citations above that the European Commission has issued an exceptionally strongly worded statement. These are comments of which the German regulatory authority ‘shall take the utmost account’ (article 7.5 of the Framework Directive 2002/21/EC) but are not directly applicable in the Member State concerned. BNetzA must now adopt a final decision, and Deutsche Telekom will be required to publish a reference offer for IP bitstream access within 3 months from the publication of the final BNetzA decision. 

The full text of the European Commission's letter SG-Greffe(2006)D/204686 can be accessed by clicking here.

For a discussion of IP bitstream access and issues relating to VDSL roll-out in Germany, please contact This e-mail address is being protected from spam bots, you need JavaScript enabled to view it . 

(the previous T-REGS news item on this topic - containing links to the European Commission press release and FAQ - remains available) 

The European Commission today adopted Commissioner Reding's proposal to make use of the unusual instrument of a Regulation to address wholesale charges and retail tariffs for international roaming on public mobile networks.

The full text of the 'Proposal for a Regulation of the European Parliament and of the Council on roaming on public mobile networks within the Community and amending Directive 2002/21/EC on a common regulatory framework for electronic communications networks and services' can be accessed by clicking here.

Downloading is available for registered users only, but registration is free and subject to our Terms of Use, including our Privacy Statement.

The essence of the proposal is as follows:

Wholesale level

Article 3: Wholesale charges for the making of regulated roaming calls

The total wholesale charge that the operator of a visited network may levy from the operator of the roaming customer’s home network for the provision of a regulated roaming call, including inter alia origination, transit and termination, shall not exceed the applicable amount per minute determined in accordance with Annex I.

ANNEX I

The total wholesale charges that the operator of a visited network may levy from the operator of the roaming customer’s home network for the making of a regulated roaming call originating on that visited network shall not exceed, on a per-minute basis, an amount equal to the average mobile termination rate published pursuant to Article 10(3) multiplied:

a) by a factor of two, in the case of a regulated roaming call to a number assigned to a public telephone network in the Member State in which the visited network is located; or

b) by a factor of three, in the case of a regulated roaming call to a number assigned to a public telephone network in a Member State other than that in which the visited network is located. The charge limits in this Annex shall include any fixed elements, such as call set-up charges.

Retail level

Article 4: Retail charges for the making of regulated roaming calls

Subject to Article 5, the total retail charge, excluding VAT, which a home provider may levy from its roaming customer for the provision of a regulated roaming call may not exceed 130% of the applicable maximum wholesale charge for that call determined in accordance with Annex I. The charge limits in this Article shall include any fixed elements associated with the provision of regulated roaming calls, such as call set up charges or opt-in fees.

Article 5: Timing of application of maximum retail charge limits for regulated roaming calls

The obligations in Article 4 shall take effect six months after the entry into force of this Regulation.

Article 6: Retail charges for the receipt of calls while roaming in the Community

The total retail charge, excluding VAT, which a home provider may levy from its roaming customer in respect of the receipt by that customer of voice telephony calls while roaming on a visited network shall not exceed, on a per minute basis, 130% of the average mobile termination rate published pursuant to Article 10(3). The charge limits in this Article shall include any fixed elements associated with the provision of regulated roaming calls, such as one-off charges or opt-in fees.

T-REGS Note: As will be seen from the text above, the proposal is that only voice calls would be subject to wholesale and retail price regulation. However, a role is reserved for the National Regulatory Authorities for messaging services, expressed as follows:

Article 8.6 National regulatory authorities shall monitor developments in wholesale and retail prices for the provision to roaming customers of voice and data communications services, including the Short Message Service (SMS) and the Multimedia Messaging Service (MMS), in particular in the outermost regions of the Community, and shall communicate the results of such monitoring to the Commission on request.

An interesting aspect going forward will be the implementation and enforcement. In this regard, we draw attention to the following:

Article 9: Penalties

The Member States shall lay down the rules on penalties applicable to infringements of the provisions of this Regulation and shall take all measures necessary to ensure that they are implemented. The penalties provided for must be effective, proportionate and dissuasive. The Member States shall notify those provisions to the Commission not later than six months following the entry into force of this Regulation and shall notify it without delay of any subsequent amendment affecting them.

As regards the inclusion of the wholesale international mobile roaming market in the Revised Recommendation on Relevant Markets Susceptible to Ex-Ante Regulation (this market is included in the list in Annex of the Consultation Document), page 10 of the explanatory document associated with today's proposal contains a statement as follows:

For an in-depth discussion of this key development, please contact This e-mail address is being protected from spam bots, you need JavaScript enabled to view it