Recent developments of EU case law on radio spectrum management

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1 BROADBAND DEPLOYMENT & SPECTRUM MANAGEMENT IN THE DIGITAL SINGLE MARKET: FROM POLICY TO JUDICIAL CONTROL Recent developments of EU case law on radio spectrum management Ignacio ULLOA RUBIO Judge at EUGC Brussels, 2nd December

2 I. C-Lon broadband deployment related to Competition ECJ , Telia Sonera ECJ , Telefónica EGC , Colt Telecommunications France II. C-L on D. 2002/20/EC, Authorisation Directive ECJ , Vodafone Omnitel NV ECJ , Commission V. Cyprus ECJ , Vodafone Malta Ltd ECJ , Commission V. France ECJ , Belgacom ECJ , Vodafone España SA ECJ , Telefónica Móviles España ECJ , Telefónica de España SA III. C-L on D. 2002/21/EC, , Framework Directive, & D. 2002/22/EC, , on Universal Service Directive ECJ , Telekomunikacja Polska SawWarszawiek ECJ , Commission V. Belgium ECJ , Commission V. Poland IV. C-L on D. 95/46/CE, , on personal data-protection directive. ECJ , Joseph Probst ECJ , Bonnier Audio AB ECJ , Deutsche Telecom AG 2

3 Case Law on broadband deployment related to Competition : Art. 102 TFUE (abuse of a dominant position) EUCJ (1st Ch.) Judgment , preliminary ruling from the Stockholms tingsrätt (Sweden), in Konkurrensverket V Telia Sonera Sverige AB in the absence of any objective justification, the fact that a vertically integrated undertaking, enjoying a dominant position on the wholesale market for ADSL input services, applies a pricing practice of such a kind that the spread between the prices applied on that market and those applied in the retail market for broadband connection services to end users is not sufficient to cover the specific costs which that undertaking must incur in order to gain access to that retail market may constitute an abuse within the meaning of Art.102 TFEU. 113: all of the circumstances of each individual case should be taken into consideration. In particular: - as a general rule, primarily the prices and costs of the undertaking concerned on the retail services market should be taken into consideration. Only where it is not possible, in particular circumstances, to refer to those prices and costs should those of competitors on the same market be examined, and -it is necessary to demonstrate that, taking particular account of whether the wholesale product is indispensable, that practice produces an anti-competitive effect, at least potentially, on the retail market, and that the practice is not in any way economically justified. 114: The following factors are, as a general rule, not relevant to such an assessment: - the absence of any regulatory obligation on the undertaking concerned to supply ADSL input services on the wholesale market in which it holds a dominant position; - the degree of dominance held by that undertaking in that market; - the fact that that undertaking does not also hold a dominant position in the retail market for broadband connection services to end users; - whether the customers to whom such a pricing practice is applied are new or existing customers of the undertaking concerned; - the fact that the dominant undertaking is unable to recoup any losses which the establishment of such a pricing practice might cause, or - the extent to which the markets concerned are mature markets and whether they involve new technology, requiring high levels of investment. 3

4 EUGC (8th Ch.) Judgment , annulment of Commission Decision C (2007) 3196 final ( ): Telefónica, SA V Commission (T-336/07). General Advocate Wathelet Conclusions Relevant market 111: the possibilities of competition must be judged in the context of the market comprising the totality of the products which, with respect to their characteristics, are particularly suitable for satisfying constant needs and are only to a limited extent interchangeable with other products. Moreover, since the determination of the relevant market is useful in assessing whether the undertaking concerned is in a position to prevent effective competition from being maintained and to behave to an appreciable extent independently of its competitors, its customers and consumers, an examination to that end cannot be limited solely to the objective characteristics of the relevant products, but the competitive conditions and the structure of supplyanddemand onthemarketmustalsobetakenintoconsideration The concept of the relevant market implies that there can be effective competition between the products which form part of it and this presupposes that there is a sufficient degree of interchangeability between all the products forming part of thesamemarketinsofarasaspecificuseof suchproductsisconcerned [a] relevant product market comprises all those products and/or services which are regarded as interchangeable or substitutable by the consumer, by reason of the products characteristics, their prices and their intended use. [From an economic POV, definition of the relevant market, demand-side substitution Supply-side substitutability ]. That means that suppliers are able to switch production to the relevant products and market them in the short term without incurring significant additional costs or risks in response to small and permanent changes in relative prices(p.20 of that notice) the Court must reject the applicants argument that there is sufficient substitutability between the regional wholesale product, the national wholesale product and local loop unbundling, owing to the fact that in each of Telefónica s exchanges a sufficient number of alternative operators use a combination of different wholesale products that best meet their needs and that that substitutability on the margin is sufficient in the present case for those products to be considered to belong to the same relevant product market. 4

5 Dominat position 146 the question whether a pricing practice introduced by a vertically integrated dominant undertaking in a wholesale market and resulting in the margin squeeze of competitors of that undertaking in the retail market does not depend on whether that undertaking is dominant in that retail market. 162 The possible existence of competition on the market is indeed a relevant factor for the purposes of determining the existence of a dominant position. However, even the existence of lively competition on a particular market does not rule out the possibility that there is a dominant position on that market, since the predominant feature of such a position is the ability of the undertaking concerned to act without having to take account of this competition in its market strategy and without for that reason suffering detrimental effects from such behaviour. 166 Although the ability to impose regular price-increases unquestionably constitutes a factor capable of pointing to the existence of a dominant position, it is by no means an indispensable factor, as the independence which a dominant undertaking enjoys in pricing matters has more to do with the ability to set prices without having to take account of the reaction of competitors, customers and suppliers than with the ability to increase prices However, since all the competing wholesale access products are based on Telefónica s local loops or on its regional wholesale product, the availability of competing products depends not only on the actual availability of unbundled local loops and/or the regional wholesale product, but also on the economic conditions under which they are provided. Pricing 187 itmustbeborneinmindthatitisthemarginsqueezethat,intheabsenceofanyobjectivejustification,isin itself capable of constituting an abuse within the meaning of Art. 82 EC. A margin squeeze is the result of the spread between the prices for wholesale services and those for retail services and not of the level of those prices as such. In particular, that squeeze may be the result not only of an abnormally low price on the retail market, but also of an abnormally high price on the wholesale market (see, to that effect, TeliaSonera, p. 146). Accordingly, the Commission was not required to demonstrate in the contested decision that Telefónica charged excessive prices for its wholesale indirect access products or predatory prices for its retail products. 5

6 190. In order to assess the lawfulness of the pricing policy applied by a dominant undertaking, reference should be made, in principle, to pricing criteria based on the costs incurred by the dominant undertaking itself and on its strategy In particular, as regards a pricing practice which causes a margin squeeze, the use of such analytical criteria can establish whether that undertaking would have been sufficiently efficient to offer its retail services to endusers otherwise than at a loss if it had first been obliged to pay its own wholesale prices for the intermediary services The validity of such an approach is reinforced by the fact that it also conforms to the general principle of legal certainty, since taking into account the costs and prices of the dominant undertaking enables that undertaking, in the light of its special responsibility under Art. 82 EC, to assess the lawfulness of its own conduct. While a dominant undertaking knows its own costs and prices, it does not as a general rule know those of its competitors. Furthermore, an exclusionary abuse also affects potential competitors of the dominant undertaking, which might be deterred from entering the market by the prospect of a lack of profitability Admittedly, it also follows from the case-law that it cannot be ruled out that the costs and prices of competitors may be relevant to the examination of the pricing practice at issue. However, it is only where it is not possible, in the light of the particular circumstances indicated by the Court of Justice, to refer to the prices and costs of the dominant undertaking that the prices and costs of competitors on the same market should be examined(teliasonera, ), and the applicants have not maintained that this is the case here. 201 that Art. 82 EC prohibits, in particular, an undertaking in a dominant position on a specific market from adopting pricing practices which have an exclusionary effect on its equally efficient actual or potential competitors (see p. 189). In that regard, examination of such a position calls for an assessment of the possibilities of competition in the context of the market consisting of all the products which, according to their characteristics, are particularly appropriate for satisfying consistent needs and are not readily interchangeable with other products, the determination of the relevant market serving to evaluate whether the undertaking concerned is able to hinder effective competition on that market (see p. 111). In fact, it has been held, first, that the Commission was correct to take the view that local loop unbundling, the national wholesale product and the regional wholesale product did not belong to the same market and, second,, that a margin squeeze onarelevantmarketwasinitselflikelytoconstituteanabusewithinthemeaning ofart.82ec. 202 Those wholesale products are not part of the same product market. 6

7 Distortion of competition 204. According to the case-law, a system of undistorted competition, as laid down in the Treaty, can be guaranteed only if equality of opportunity is secured as between the various economic operators. Equality of opportunity means that Telefónica and its at least equally efficient competitors are placed on an equal footing on the retail market. That is not the case, 1 st, if the prices of national and regional wholesale products paid to Telefónica by the alternative operators could not be reflected in their retail prices and, 2 nd, if the alternative operators, given the prices of Telefónica s national and regional wholesale products, could offer those products onlyataloss,whichtheywouldhavetooffsetbyrevenuescoming from othermarkets Furthermore, the applicants argument based on the use by the alternative operators during the infringement period, in each exchange, of an optimal combination of wholesale products, which would include local loop unbundling, is inconsistent, Telefónica had maintained the possible existence of a margin squeeze must be carried out solely on the basis of the regional wholesale product For the purposes of establishing an infringement of Art. 82 EC, it is sufficient to show that the abusive conduct of the undertaking in a dominant position tends to restrict competition or, in other words, that the conduct is capable of having, or likely to have, that effect The pricing practice concerned must have an anticompetitive effect on the market, but the effect does not necessarily have to be concrete, and it is sufficient to demonstrate that there is a potential anti-competitive effect that may exclude competitors who are at least as efficient as the dominant undertaking(teliasonera, p.146 above, p.64) the competition rules laid down in the EC Treaty supplement, by ex-post review, the regulatory framework adopted by the EU legislature for ex-ante regulation of the telecommunications markets. Relevance of National Law 328. It must be borne in mind that Art. 82 EC applies only to anti-competitive conduct engaged in by undertakings on their own initiative. If anti-competitive conduct is required of undertakings by national legislation or if the latter creates a legal framework which itself eliminates any possibility of competitive activity on their part, Art. 82 EC does not apply. In such a situation, the restriction of competition is not attributable, as that provision implicitly requires, to the autonomous conduct of the undertakings. 7

8 Intetion: Due diligence 319. In the first place, as regards the question whether an infringement was committed intentionally or negligentlyand is thereforeliabletobepenalised byafineunder Art.23(2)of Regulation No 1/2003, it follows from the case-law that that condition is satisfied where the undertaking concerned could not have been unaware that its conduct was anti-competitive, whether or not it was aware that it was infringing the competition rules of the Treaty According to the case-law, an undertaking is aware of the anti-competitive nature of its conduct where it is aware of the essential facts justifying both the finding of a dominant position on the relevant market and the finding bythecommission ofanabuseofthatposition As a diligent economic operator, Telefónica ought to have been familiar with the principles governing market definition in competition cases and, where necessary, taken appropriate legal advice to assess, to a degree that is reasonable in the circumstances, the consequences that a given act may entail. That is particularly true in relation to persons carrying on a professional activity, who are used to having to proceed with a high degree of caution when pursuing their occupation. They can on that account be expected to take special care in assessing the risks that such an activity entails Furthermore, there can be no doubt, for a prudent economic operator, that, although the possession of large market shares is not necessarily and in every case the only factor determining the existence of a dominant position, it has however a considerable significance which must of necessity be taken into consideration by him in relation to his possible conduct on the market Telefónica, the historical operator and owner of the only significant infrastructure for the supply of the regional and national wholesale products, could not be unaware that it held a dominant position on the relevant markets. Accordingly, the significance of the market shares held by Telefónica on the national and regional wholesale markets means that Telefonicas belief that it did not occupy a dominant position on those markets could only be the outcome of an inadequate study of the structure of the markets on which it operated or a refusal to take those structures into consideration. The argument that Telefónica could not have foreseen that the Commission would adopt a different definition of the market from that adopted by the Spanish authorities cannot therefore succeed. 8

9 EUGC Judgment , annulation de la compensation (59m ) de charges de service public [no-aide-d état] dans un projet de réseau de communications électroniques à très-haut-débit dans Hauts-de-Seine) Colt Telecommunications V Comission, France & Sequalum. 33 il appartient à la Commission de déterminer, en fonction des circonstances de fait et de droit propres à l affaire, si les difficultés rencontrées dans l examen de la mesure notifiée nécessitent l ouverture de la procédure formelle d examen. Cette appréciation doit respecter trois exigences ère) l article 88 CE circonscrit le pouvoir de la Commission de se prononcer sur l existence d une aide au terme de la procédure d examen préliminaire aux seules mesures ne soulevant pas de difficultés sérieuses, de telle sorte que ce critère revêt un caractère exclusif. Ainsi, la Commission ne saurait refuser d ouvrir la procédure formelle d examen en se prévalant d autres circonstances, telles que l intérêt de tiers, des considérations d économie de procédure ou tout autre motif de convenance administrative ou politique ème), lorsqu elle se heurte à des difficultés sérieuses, la Commission est tenue d ouvrir la procédure formelle et ne dispose, à cet égard, d aucun pouvoir discrétionnaire ème), la notion de difficultés sérieuses revêt un caractère objectif. L existence de telles difficultés doit être recherchée tant dans les circonstances d adoption de l acte attaqué que dans son contenu, d une manière objective, en mettant en rapport les motifs de la décision avec les éléments dont la Commission pouvait disposer lorsqu elle s est prononcée sur la qualification d aide de la mesure litigieuse. Il en découle que le contrôle de légalité effectué par le Tribunal sur l existence de difficultés sérieuses, par nature, ne peut se limiter à la recherche de l erreur manifeste d appréciation. 37. il convient de relever que la partie requérante supporte la charge de la preuve de l existence de difficultés sérieuses, preuve qu elle peut fournir à partir d un faisceau d indices concordants, relatifs, d une part, aux circonstances et à la durée de la phase préliminaire d examen et, d autre part, au contenu de la décision attaquée. 84. Il appartient, dès lors, au Tribunal d apprécier les indices tirés du contenu de la décision attaquée au regard de l existence d une difficulté sérieuse au sens de la jurisprudence citée aux points 34 à 37 ci-dessus. En revanche, il n appartient pas au Tribunal, à ce stade de la procédure d examen d une aide par la Commission, de se prononcer sur l existence d une aide ou sur sa compatibilité avec le marché commun. 9

10 87. Selon l arrêt Altmark, une intervention étatique ne tombe pas sous le coup de l art. 87, 1, CE(aide d état), dans la mesure où elle doit être considérée comme une compensation représentant la contrepartie des prestations effectuées par les entreprises bénéficiaires pour exécuter des obligations de service public, de sorte que ces entreprises ne profitent pas, en réalité, d un avantage financier et que ladite intervention n a donc pas pour effet de mettre ces entreprises dans une position concurrentielle plus favorable par rapport aux entreprises qui leur font concurrence En effet, il suffit de relever à cet égard que la requérante n a ni mis en évidence de doute quant à la méthode de détermination de la rentabilité du territoire départemental, ni fourni au Tribunal un minimum d éléments accréditant l utilité du document en cause (definition de zones de reference) pour les besoins de l instance l objectif visé étant la connectivité de l ensemble des établissements publics en cause, il suffit que certains d entre eux soient situés dans des zones non rentables pour que l intérêt général spécifique de l intervention publique soit reconnu. 138 la notion de «prise raccordable», qui est susceptible d être transformée et doit encore être transformée en prise raccordée, correspond précisément à l exigence d universalité telle que définie au considérant 8 de la directive 2002/22. En effet, en déployant des prises raccordables, le délégataire crée les conditions dans lesquelles il peut, à la demande des usagers, assurer à ceux-ci un raccordement au très haut débit en transformant lesdites prises en prises raccordées. Ainsi, le délégataire est obligé,...[convention de DSP], de procéder à une telle transformation, pour autant que le seuil pertinent est atteint. 166 Or, la défaillance du marché doit s apprécier en fonction des obligations de service public envisagées et, partant, en l espèce, être vérifiée à la fois dans les zones rentables et dans les zones non rentables compte tenu de l obligation de couverture universelle imposée au délégataire. 10

11 Case Law on Directive 2002/20/EC, , on authorisation of electronic communications networks and services (Authorisation Directive) EUCJ (8th Ch.) Judgment (Preliminary Ruling from Tribunale amministrativo regionale per il Lazio) Vodafone Omnitel NV & others V. Autorità per la garantie nelle Comunicazioni& others(c /12& C /12): 43 Article 12 of the Authorization Directive must be interpreted as meaning that it does not preclude legislation of a MS, such as that at issue in the main proceedings, pursuant to which undertakings providing electronic communications services or networks are liable to pay a charge intended to cover all the costs incurredbythenrawhicharenot financedbythestate,theamount ofwhichbeing determined according to the income received by those undertakings, provided that that charge is exclusively intended to cover the costs relating to the activities mentioned in Article 12(1)(a), that the totality of the income obtained in respect of that charge does not exceed the total costs relating to those activities and that that charge is imposed upon individual undertakings in an objective, transparent and proportionate manner, which is for the national court to ascertain. 11

12 EUCJ (5th Ch.) Judgment [failure to fulfill obligations of transposition of Directives 2002/20/CE (Authorization Directive) & 2002/21/CE(Frame Directive)], Commission V Cyprus (C-125/09). 42 Une transposition effective desdites dispositions suppose ainsi non seulement que l autorité compétente pour l octroi de tels droits soit clairement désignée, mais aussi que des procédures administratives transparentes soient établies pour la mise en œuvre de ceux-ci. 43. Or, le régime d autorisation en cause en matière de délivrance de droits de passage sur le domaine public manque de transparence. 44. D une part, il est constant que les autorités nationales compétentes ont procédé, lors du traitement des demandes de permis de construire ou d urbanisme, à une évaluation de l impact environnemental des champs électromagnétiques, bien qu une telle évaluation ne fût pas prévue par la législation nationale. 45. D autre part, force est de constater que la République de Chypre admet des retards relatifs à l octroi des droits de passages en ce qui concerne l installation de mâts et d antennes, ces retards résultant du chevauchement des compétences entre les autorités chargées de délivrer les permis de construire et d urbanisme. 46. Dans ces conditions, il y a lieu de constater que, en ne garantissant pas l octroi de droits de passage sur, au dessus ou au-dessous de propriétés publiques sur la base de procédures transparentes, appliquées sans discrimination et sans retard, conformément aux articles 11, paragraphe 1, de la directive «cadre», et de l article 4, paragraphe 1, de la directive «autorisation», la République de Chypre a manqué aux obligations qui lui incombent en vertu de ces directives. 12

13 EUCJ Judgment (3 rd Ch.) (preliminary ruling from Qorti Kostituzzjonali di Malta) Vodafone Malta Ltd. & others V Avukat Ġenerali& others (C-71/12): 25. On the other hand, a charge the trigger for which is linked not to a general authorisation procedure for access to the electronic telecommunications services market but to the use of mobile telephony services provided by operators and which is ultimately borne by the user of suchservicesdoesnotfallwithinthescopeofart.12ad. 27 thechargeatissueinthemainproceedingsisreferredtoas exciseduty, that it is not levied on all electronic telecommunications operators holding a general authorisation but only on operators proving mobile telephony services that charge is paid to the mobile telephony operators by their users on an individual basis, the sum in question subsequently being passed on to the Comptroller of Customs by all operators providing mobile telephony services and being payable only by those operators and not by other undertakings, including those providing electronic communications networks and other services. 28. In the light of those considerations, it would appear that the charge at issueinthemainproceedingsisakintoataxonconsumption,whichisamatter for the national court to verify. If that is indeed the case, that charge does not fallwithinthescopeofart.12ofad. 13

14 EUCJ (3rd Ch.) Judgment (failure to fulfill obligations of Directive 2002/20/CE) Commission V France (C- 485/11). 33. En l occurrence, il y a lieu de relever que, ainsi qu il ressort du libellé de l article 302 bis KH du CGI, le fait générateur de la taxe litigieuse prévue à cet article est lié à la fourniture d un service en France par tout opérateur de communications électroniques et. L article 302 bis KH du CGI prévoit qu un opérateur ne devient redevable de cette taxe litigieuse que lorsque ses revenus pour les services aux usagers finals excèdent 5 millions. Les opérateurs de communications électroniques qui fournissent des prestations d interconnexion, d accès, de diffusion ou de transport des services de communications audiovisuelles ne sont pas redevables de la taxe litigieuse. 34 Il en découle que la taxe litigieuse est imposée non pas à tous les opérateurs de communications électroniques titulaires d une autorisation générale ou d un droit d utilisation des radiofréquences ou des numéros, mais aux opérateurs titulaires d une autorisation générale qui fournissent déjà leurs services sur le marché des services de communications électroniques aux usagers finals. De plus, les conditions d imposition de cette taxe énoncées à l article 302 bis KH du CGI montrent qu elle n est pas imposée [que] à l activité de l opérateur consistant à fournir des prestations de communications électroniques aux usagers finals en France. Par conséquent, il y a lieu de considérer que le fait générateur de la taxe litigieuse n est pas lié à la procédure d autorisation générale ou à l octroi d un droit d utilisation des radiofréquences ou des numéros. Dès lors, elle ne relève pas du champ d application de l article 12 de la directive «autorisation». 14

15 EUCJ (4 th Ch.) Judgment (preliminary ruling from the Belgium Constitutional Court) Belgacom, Mobistar & KPN Group SA V Belgium (C-375/11). 54 Arts 12 and 13 of the Authorisation Directive must be interpreted as not precluding a MSfrom charging mobile telephone operators holding rights of use for radio-frequencies a oneofffeepayableforbothanewacquisitionof rights ofuseforradio frequenciesandforrenewals of those rights, in addition to an annual fee for making the frequencies available, intended to encourage optimal use of the resources while at the same time also covering the cost of managing the authorisation, provided that those fees genuinely are intended to ensure optimal use of the resource made up of those radio frequencies [promotion of competition] and are objectively justified, transparent, non-discriminatory and proportionate in relation to their intended purpose and take into account the objectives in Art. 8 of the Framework Directive, whichitisforthenational courttoassess. 55 the fixing of the amount of a one-off fee for rights of use for radio frequencies by reference either to the amount of the former one-off licence fee calculated on the basis of the number of frequencies and months to which the rights of use relate, or to the amounts raised through auction, may be an appropriate method for determining the value of the radio frequencies Art. 14(1) of the Authorisation Directive not precluding a MS from charging a mobile telephone operator a fee such as, provided that that amendment is objectively justified and effected in a proportionate manner and notice has been given to all interested parties in order toenablethemtoexpresstheirviews,whichitisforthenational courttoassess the fact of charging mobile telephone operators fees such as those at issue in the main proceedings is not liable to influence the content and scope of the rights of use for radio frequencies granted to the operators concerned. Consequently, the amendment to the fees scheme is not a restriction or withdrawal of the rights of use for radio frequencies for the purposes of Article 14(2) of the Authorisation Directive. 15

16 EUCJ (4th Ch.) Judgment preliminary ruling from the Tribunal Supremo(Spain) Vodafone Spn SA V Ayuntamiento de Staª Amalia y de Tudela// France Telecom Spn. SA V Ayuntamiento de Torremayor(C- 55/11, 57-58/11). 35 Article 13 of the Authorisation Directive must be interpreted as precluding the imposition of a fee for the right to install facilities on, over or under public or private property on operating undertakings which, without being proprietors of those facilities, use them to provide mobile telephony services. 38 Art. 13 of the Authorisation Directive satisfies those criteria (direct effect). That provision provides, in unconditional and precise terms, that MS may imposefees forrights in three specific cases, namely for the rights of use for radio frequencies or numbers or for the rights to install facilities on, over or under public or private property. 16

17 EUCJ (3rd Ch.) Judgment , preliminary ruling from the Tribunal Supremo(Spain) at Telefónica Móviles España SA V A.E. & SE de Telecomunicaciones(C- 85/10). 34 a charge imposed on operators of telecommunications services for the use of scarce resources must ensure an optimal use of those resources and must take account of the need to foster the development of innovative services and competition cannot, in light of the foregoing, preclude MS from establishing, for the purposes of determining the amount of that charge, a distinction even a significant one between, on the one hand, the digital or analogue technology used and, on the other, within each technology, the different uses which are made of it, so that equality of opportunity is secured as between the various economic operators. 35. In addition, those requirements cannot, in principle, prevent MS from increasing, even significantly, the charge payable for a particular technology in response to both technical and economic developments on the market for telecommunications services, but leaving unchanged the charge for another technology, provided that the different amounts imposed reflect the respective economic values of the uses made of the scarce resource at issue. 36. Lastly, the sole fact that such an increase in the amount of the charge is substantial does not in itself mean that this is incompatible with the purpose that a charge for the use of scarce resources must have under Art. 11(2) of Directive 97/13, provided that the charge is neither excessive nor too low. 38. the requirements laid down in Art. 11(2) of Directive 97/13, do indeed influence the level of that charge, but do not oblige MS to use that charge for a particular purpose or to use the income from that charge in a particular manner. 40 the answer to the questions referred is that the requirements laid down in Art. 11(2) of Directive 97/13 under which a charge imposed on operators of telecommunications services for the use of scarce resources.must be interpreted as not precluding national legislation which provides for a fee to be levied on operators of telecommunications services holding individual licences for the use of radio frequencies, but does not allocate a specific use to the income derived from that fee, and which significantly increases the fee for a particular technology but leaves it unchanged for another. 17

18 EUCJ (7th CH.) Judgment , preliminary ruling from the Tribunal Supremo (Spain) at Telefónica de España SA V AE. (C-284/10). 29 Directive 97/13 merely states, in Arts 6 and 11, that the fees imposed on holders of general authorisations and holders of individual licences may seek only to cover the administrative costs incurred respectively in the issue, management, control and enforcement of the applicable general authorisations scheme or the individual licences Art. 6 does not impose the requirement of a proportionate relationship between the fee applicable to general authorisations granted to a chargeable operator and the work involved in the issue, management, control and enforcement of those general authorisations for that operator. 30 Art. 12 of the Authorisation Directive provides that any administrative charges incurred in the enforcement of the general authorisation scheme are to be imposed upon the individual undertakings in a proportionate manner. It follows that the criterion of proportionality provided for in Art. 12 relates to the imposition of administrative costs upon chargeable persons and not to the relationship between the fee applicable to general authorisations and the work involved. 31. MS are entitled to determine the amount of that fee on the basis of the gross operating income of the chargeable persons, firstly, whether it is an objective, transparent and non-discriminatory criterion. Secondly, that criterion for determining the amount is not unconnected with the costs incurred by the competent national authority. 34. MS may impose on holders of general authorisations an annual fee aimed at defraying administrative costs, [and] may be made liable to pay a fee to cover, in addition to the costs of issuing the general authorisation, the administrative costs incurred in the management, control and enforcement of the authorisation during its period of validity. 35 legislation of a MS introducing a fee imposed on holders of general authorisations, to the extent that the combinedrevenuereceived bythatms bywayof suchafeedoesnotexceedallof thoseadministrativecosts. Ee 18

19 Case Law on Directive 2002/21/EC, , on a common regulatory framework for electronic communications networks and services (Framework Directive) & Directive 2002/22/EC, , on universal service and users rights relating to electronic communications networks and services (Universal Service Directive) EUCJ (3rd Ch.) Judgment (preliminary ruling from the Polska Naczelny Sąd Administracyjny) Telekomunikacja Polska SawWarszawie V Prezes Urzędu Komunikacji Elektronicznej PUKE(C-522/08) 30 the Framework Directive and the Universal Service Directive cannot preclude national legislation, such as that at issue in the main proceedings, which, for the purpose of protecting end-users, prohibits an undertaking from making the conclusion of a contract for the provision of telecommunications services contingent on the conclusion, by the end-user, of a contract for the provision of other services. 33 However, Directive 2005/29 must be interpreted as precluding national legislation which, with certain exceptions, and without taking account of the specific circumstances, imposes a general prohibition of combined offers made byavendortoaconsumer. EUTG(7 th Ch.)Order ; EUCJ(8 th Ch.)Judgment (Appeal) PUKE&Poland VCommission (rejects Cassation) 19

20 EUCJ (3rd Ch.) Judgment , failure to fulfill obligations of Directive 2002/22/CE: Comission V Belgium(C-134/10). 42. the designation of certain television channels as being subject to the must-carry obligation, under Art.13 of the Law of , constitutes a restriction of the freedom to provide services within the meaning ofart.56tfeu,asthecourthasalreadyheld. 44 a cultural policy may constitute an overriding requirement relating to the general interest which justifies a restriction of the freedom to provide services 54 Clearly, the mere statement of a general policy objective, which is not accompanied by any additional factor capable of enabling operators to determine in advance the nature and effect of the precise conditions and obligations to be fulfilled if they apply for the award of must-carry status, does not permit these requirements to be met. 55. Consequently, it must be held that the 2 nd indent of the 1 st paragraph of Art. 13 of the Law of does not clearly define the actual criteria relied upon by the national authorities to select the television broadcasters benefiting from the must-carry obligation and that that provision is not, therefore, sufficiently precise to ensure that the broadcasters thus selected are those whose content, in its entirety, is capable of meeting the general interest cultural objective pursued. 60 the criteria to be met for the award of must-carry status are unknown to the non-public television broadcasters capable of benefiting from the must-carry obligation. Consequently, such a procedure does not observe the principle of transparency, as provided for in Art. 31(1) of the Universal Service Directive. 64. a Royal Decrete designate, as benefiting from the must-carry obligation, non-public broadcasters coming under the powers of the French and Flemish Communities, so that all the programmes broadcast by those broadcasters would automatically benefit from that obligation irrespective of the overall content of those programmes and their ability to meet the legitimate general interest objectives 68 It is unclear from the 2 nd indent of the 1 st paragraph of Art. 13 of the Law of what the effect of the requirement is that non-public broadcasters must fall under the powers of the Belgian Community in order to benefit from must-carry status. 20

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