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IP/10/340

Brussels, 23rd March 2010

Telecoms: Lithuania withdraws proposed regulatory measures on network access market

On 16 March 2010 the Lithuanian Authority, Ryšių reguliavimo tarnyba (RRT), informed the European Commission that it was withdrawing its proposed measure on network infrastructure access markets. These access services are used by alternative operators to connect their customers to telecoms services like telephone and internet. The Commission had earlier this month raised serious doubts about the compatibility of the proposed regulation with the principles of EU competition law and EU's telecoms rules and had launched a two month investigation (see IP/10/266). RRT has now indicated to the Commission that it intends to revise its findings and notify the revised measure to the Commission.

EU Digital Agenda Commissioner Neelie Kroes said: "The withdrawal of this measure will allow the Lithuanian regulator to address the concerns raised by the Commission. We will work together with RRT to resolve this matter so that it does not restrict competition on the telecoms market or penalise Lithuanian consumers."

On 11 January 2010, the Lithuanian telecoms regulator notified the Commission of its plans to regulate the market for unbundled access to local lines, i.e. the "last mile" of a telecoms network before reaching the customer. Technically, the line connecting a specific consumer can be separated from the other lines (the "bundle") traditionally owned by the incumbent and can be used by alternative operators to provide broadband and fixed telephone services to that customer.

The Lithuanian national telecoms regulator had identified differences between unbundled access provided through copper lines and optical fibre-to-the-home (FTTH) local lines and had defined separate copper and FTTH access markets. In addition, RRT had proposed to exclude unbundled access through fibre-to-the-building (FTTB) lines from both markets (see IP/10/266).

The Commission was concerned that the market definition proposed by RRT was not in line with the principles of competition law and EU telecoms rules and called for further market clarifications and data from RRT and market players.

The Lithuanian regulator has now withdrawn its measure. RRT will revise its findings and notify its revised measure to the Commission at a later stage.

Background

Draft measures are notified to the Commission in accordance with the so-called "Article 7 procedure " under the Framework Directive of the EU telecoms rules (MEMO/09/539). This procedure leaves some scope for regulators to achieve effective competition in their national telecoms markets, while ensuring consistency across the EU, and therefore requires them to notify the Commission of draft regulations. Where these concern market definitions and analyses of whether operators have significant market power, as in the present case, the Commission can require the regulator to withdraw the measure. Where they concern regulatory measures, the Commission may make comments of which the regulator must take utmost account. Before a final decision is adopted by the Commission, regulators can at any time voluntary withdraw their draft measures.

The Lithuanian regulator's letter sent today to the European Commission will be made available shortly, in accordance with EU and national rules on business confidentiality, at:

http://circa.europa.eu/Public/irc/infso/ecctf/library?I=/commissiondecisions


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