C_2007283EN.01001902.xml

24.11.2007

Official Journal of the European Union

C 283/19

Action brought on 13 September 2007 — Commission of the European Communities v Federal Republic of Germany

(Case C-424/07)

(2007/C 283/35)

Language of the case: German

Parties

Applicant: Commission of the European Communities (represented by: G. Braun and A. Nijenhuis, acting as Agents)

Defendant: Federal Republic of Germany

Form of order sought

—

declare that, with the provisions made in paragraphs 3 No 12(b) and 9(a) of the German Law on Telecommunications (Telekommunikationsgesetz — ‘TKG’), newly inserted into the TKG by the Law amending the laws governing telecommunications of 18 February 2007, the Federal Republic of Germany has infringed Articles 6, 7, 15(3), 16 and 8(1) and (2) of Directive 2002/21/EC of the European Parliament and of the Council of 7 March 2002 on a common regulatory framework for electronic communications networks and services (1), Article 8(4) of Directive 2002/19/EC of the European Parliament and of the Council of 7 March 2002 on access to, and interconnection of, electronic communications networks and associated facilities (2), as well as Article 17(2) of Directive 2002/22/EC of the European Parliament and of the Council of 7 March 2002 on universal service and users' rights relating to electronic communications networks and services (3);

—	order the Federal Republic of Germany to pay the costs.

Pleas in law and main arguments

The common regulatory framework for electronic communications networks introduced in 2002 sets out aims for the actions of national regulatory authorities and lists the measures that national regulatory authorities can take to achieve those aims. By providing room for the exercise of discretion, this regulatory framework allows national regulatory authorities to proceed — following careful analysis of the market — in a manner that takes into careful consideration the particular features of each individual case. According to the provisions of Community law, national regulatory authorities shall define the relevant markets appropriate to national circumstances, in accordance with the principles of competition law, taking the utmost account of the Commission's recommendation and the guidelines. Therefore, it is the national regulatory authorities that define the relevant markets, and not the national legislator or another national institution. In view of the independence of national regulatory authorities, which are under an obligation to exercise their powers in a manner that is impartial and transparent, this is a central structural element in the procedure leading to the definition of the market, which is not within the legislator's discretion. In addition, if necessary, national regulatory authorities undertake an analysis of the markets and determine whether — and, if required, which — remedies have to be imposed. There is a mechanism for consultation as regards definition and analysis of the market.

In contrast to the market definition and market analysis procedures under Community law, the German legislator lays down the definition of ‘new markets’ and establishes in advance the conditions under which the regulatory authority is entitled, exceptionally, to regulate new markets, instead of leaving it to the regulatory authority to conduct this assessment. In addition, the German legislator imposes on the regulatory authority a regulatory aim to which it must pay particular attention. Those provisions of the German Law on Telecommunications infringe the provisions of Directives 2002/19/EC, 2002/21/EC and 2002/22/EC, by circumventing the rules on the regulation of the market provided for in those directives and unduly limiting the regulatory authority's discretion.

The German rules in issue make it impossible for the national regulatory authority to define all markets in accordance with the principles of competition law and — by including a global provision that, by law, certain markets cannot be regulated — to take decisions on the merits that take into consideration each individual case. The regulatory authority is only obliged to follow the procedures for consultation and cooperation provided for in the Community regulatory framework, and to inform market participants, European regulatory authorities and the Commission of the result of its analysis of a ‘new market’, if, at the same time, it reaches the conclusion that additional conditions are fulfilled and it therefore considers that regulation is required. The provisions of the German Law on Telecommunications in issue could cause the German regulatory authority to define and analyse a market and take the decision not to regulate it without following the intended procedures for consultation and cooperation.

Therefore, in the Commission's view, there is a danger that those provisions would significantly undermine the liberalisation of the markets for electronic communication, as well as the opening of those markets to competition, that have been achieved because of the common regulatory framework. There is a threat that some markets, such as, for example, broadband markets — which use the fixed line networks of the former monopoly operators and which are particularly important for technological development — could be re-monopolised, which would be a reversal of what has been achieved so far, also partly thanks to the common regulatory framework.

(1) OJ L 108, 24.4.2002, p. 33.

(2) OJ L 108, 24.4.2002, p. 7.

(3) OJ L 108, 24.4.2002, p. 51.