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IP/10/320

Brussels, 18th March 2010

Telecoms: Commission requests information from Poland on national wholesale price regulation rules

The European Commission has decided to send a formal request for information to Poland concerning its implementation of EU telecoms rules. In particular, the Commission is concerned that Poland may have failed to correctly implement into national law EU rules on the setting of prices for wholesale telecom services. This has created legal uncertainty and could be discriminatory for telecoms companies. The request for information takes the form of a "letter of formal notice under EU infringement procedures (Article 258 of the Treaty on the Functioning of the European Union). Poland has two months to reply. If the Commission receives no reply, or if the observations presented by the Polish Government are not satisfactory, the Commission may issue a 'reasoned opinion' under EU infringement procedures (requesting Poland to amend its legislation to ensure full compliance with EU rules).

Digital Agenda Commissioner Neelie Kroes said "The Commission has to verify that the Polish regulator has the right tools to impose the right remedies in wholesale telecom markets. This principle is one of the cornerstones of EU telecoms rules.

The Commission's concerns stem from an amendment to the Polish Telecommunications Act of 24 April 2009, which gives the Polish regulator broad discretion to set the level of prices for wholesale telecommunications services by applying its own methodology, which can include comparison with other comparable markets. This methodology can be applied independently of an imposed cost-orientation, a mandated cost accounting system currently in place and the positive verification of compliance by a qualified independent body. This does not comply with the relevant requirements of the EU regulatory framework, which requires national regulators to carefully select the remedies, ensuring that the obligations imposed are appropriate and proportionate in relation to the nature of the problem identified.

Background

Under EU rules, if national regulators consider in their market analysis that there is no, or only limited, competition on certain telecoms markets, they can impose appropriate specific obligations on operators with significant market power on a specific market, following a market analysis. The remedy chosen should be proportionate and based on the nature of the problem identified. For example, price control remedies can be relatively light, such as an obligation that prices are reasonable. These remedies can also be heavier, such as an obligation that prices charged by the operator have to be justified by underlying costs (principle of cost orientation), combined with a specified cost accounting system which is then verified by a qualified auditor.

A detailed overview of telecoms infringement proceedings is available at:

http://ec.europa.eu/information_society/policy/ecomm/implementation_enforcement/infringement/


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