On 13 March 1996, the Commission adopted a Directive amending Commission Directive 90/388/EEC regarding the implementation of full competition in telecommunications markets (Directive 96/19/EC; OJ 1996 L74/13). The Directive is based on Article 90(3) of the EC Treaty which gives the Commission power to adopt directives aiming to ensure the application of Article 90 EC Treaty which, in short, requires the Member States to abide by the rules of the Treaty, in particular in the field of competition.
Pursuant to Directive 90/388/EEC, which was adopted in June 1990, Member States were required to abolish all exclusive and special rights for the supply of telecommunications services other than voice telephony. As regards packet- or circuit-switched data services, transitional measures until the end of 1992 were provided for. Originally, the following services were explicitly excluded from the scope of Directive 90/388/EEC: radio and television broadcasting, telex, mobile radio telephony, paging and satellite services. As a result of subsequent amendments, all these services (except for radio and television broadcasting) are currently covered by the provisions of Directive 90/388/EEC. However, prior to the adoption of the last amendments, Directive 90/388/EEC still allowed Member States to maintain exclusive and special rights for the supply of voice telephony. It was argued that the financial resources of the existing telecommunication operators mainly derived from telephony services and that an immediate opening of this service to competition would threaten the financial stability of those operators and could obstruct the performance of tasks of general economic interest assigned to them, i.e. the provision and exploitation of a telecommunications network with a general geographic coverage within the Member State concerned for the provision of a minimum set of service to all users for an affordable price (i.e. the provision of universal service).
Recognising that the continuation of universal service can be ensured by less restrictive means than the provision of exclusive or special rights, the Member States are required, pursuant to the amending Directive of 13 March 1996, to abolish all restrictions for the provision of public voice telephony services and public telecommunications networks by 1 January 1998, subject to an additional transition period of maximum five years for Member States with less developed networks (i.e. Spain, Ireland, Greece and Portugal) or of maximum two years for Member States with a very small network (i.e. Luxembourg). Moreover, in order to accomplish effective competition, the Member States are required to ensure that all restrictions concerning the use of (alternative) networks for the provision of telecommunications services other than voice telephony are lifted as from 1 July 1996. According to the Commission, the continuation of exclusive or special rights on the provision and use of infrastructure will result in an infringement of Article 90(1) in combination with Article 59 and 86 EC Treaty. Consequently, as of 1 July 1996, all alternative networks, such as the telecommunications infrastructure of the railways, energy and water companies which are presently used by these companies for internal purposes only, may be used for the provision of telecommunications services other than voice telephony to third parties. The same already applies to the cable TV networks for which the Commission adopted a separate (amending) Directive in October 1995 (Directive 95/51/EC, OJ 1995, L 256/49). As from 1 January 1998, full competition in the telecommunications markets will be a reality for as of that date all (alternative) telecommunications networks may be used for the provision of telecommunications services including voice telephony to the general public.
At the same time, the amending Directive sets out some guiding principles concerning inter alia licensing, numbering, the granting of rights of way and interconnection.
For the purpose of compliance with essential requirements (i.e. conditions for safeguarding non-economic reasons in the general interest), Member States may provide for a licensing procedure for the provision of voice telephony, public telecommunications networks and other telecommunications networks involving radio frequencies and for general authorisation or declaration procedures for the supply of other telecommunications services and networks. However, the relevant conditions must be objective, non-discriminatory, proportionate and transparent. Member States may limit the number of licenses only when justified for reasons of lack of availability of frequencies and in accordance with the principle of proportionality.
As regards numbering, the Member States must ensure before 1 July 1997 that adequate numbers are available for all telecommunications services. Numbers shall be allocated in an objective, non-discriminatory, proportionate and transparent manner. Moreover, the Directive includes a prohibition for the Member States to discriminate with regard to the granting of rights of way for the provision of public telecommunications networks.
Currently, the Parliament and Council are in the process of harmonising the national interconnection regimes. The present Commission Directive is without prejudice to this future harmonisation. In this view, the present Directive stipulates that the Member States shall ensure that the telecommunication organisations provide interconnection to their voice telephony networks on objective, non-discriminatory, proportionate and transparent terms. Interconnection arrangements are subject to commercial negotiations between the parties involved. However, if no agreement is reached within a reasonable time, the Member States shall upon request of either party adopt a reasoned decision which establishes the necessary conditions for interconnection.
As regards universal service, it is recognised that its provision may in some cases only be possible at a loss. The Directive sets out the conditions to be respected in the financing schemes established by the Member States to ensure the provision of universal service. Any national scheme shall only apply to undertakings providing public telecommunications networks and allocate the respective burden to each undertaking according to objective and non-discriminatory conditions and in accordance with the principle of proportionality. If follows from the recitals to the Directive that a disproportionate burden on new entrants should be avoided. It is explicitly stated that the Member States may exempt new entrants from contributing to the national scheme for the financing of universal service for as long as they have not achieved a significant market presence.
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