The recent changes to the German communications law prompted the European Commission to open an infringement procedure against the country, to which the regulator has 15 days to respond. At the heart of the controversy is the introduction of a kind of regulatory rest for the incumbent operator, who can now develop his activities in broadband in the light of competition law.
This change removes Germany from the other Member States and frees the incumbent operator from a set of obligations to which it was subject in a model in which the company with significant market power is analyzed, for each of the telecommunications services provided, and imposed a set of obligations that guarantee competition access to the network.
The progressive elimination of a priori regulation and its substitution by competition rules, as a way of regulating the market is an objective defended also by the EC, but with clear divergences of timing. The European Union’s executive body recommends this measure, but only in a scenario of effective competition, after the elimination of historical monopolies and the democratization of access to the historical network in each country.
Regarding Germany, the EC considers that the time to ease the regulation on incumbent is not appropriate, a position that had already been communicated to the local regulator, but which was not respected. Neither by the Government, which in September last year proposed the legislative review, nor by the regulator itself, which did not stop the introduction of the review, although at the end of last year a set of corrective measures was aligned.
The legislative changes will allow Deutshe Telekom, with a share of more than 70 percent in a broadband market that does not reach 17 percent of the German population, to make available on the market a new offer of VDSL without wholesale obligations to its competitors .
The EC reacts with the opening of an infringement procedure which, as a matter of urgency, grants only a period of 15 days for the German State to react. The case continues with the threat of an appeal, as soon as possible, to the European Court of Justice. The EC claims that the changes introduced by the German government violate the Electronic Communications Law approved by the European Parliament and adopted by all EU countries.
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