GERMAN COMPETITIVE CARRIERS CRITICIZE DRAFT TELECOM ACT
German competitive telecom carriers vigorously disputed the main provisions of an amendment to that country’s Telecom Act in the only public hearing held by the Economic Affairs Committee of the German Bundestag Mon. in Berlin. Competitors strongly criticized Deutsche Telekom’s (DT’s) attempts to eliminate resale obligations for broadband services and asked that the new Act require timely access for the incumbent’s new wholesale products. Meanwhile, DT threatened to revisit its investment plans if the law imposed burdensome requirements on resale services.
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The draft, which was introduced in the Bundestag in Jan., is scheduled to be voted on March 12 by the lower chamber of German Parliament, and April 2 by the upper chamber. They are expected to have final votes in May, with the Act’s publication in the Federal Gazette -- an equivalent to the U.S. Federal Register -- expected in June.
The “hearing showed that a lot of amendments to the Telecommunications Act are necessary to provide the regulator with sharp tools,” said Axel Spies, a Washington attorney representing the German Competitive Carriers Assn. (VATM). In the 6-hour hearing, VATM complained that the draft sought to reduce regulations in the subscriber segment, which it said gave DT “more leeway in this area. Such a concession can only be politically justified if the regulation concerning advance provisioning products is retained.” It said that regulation was “indispensable” for healthy competition and had to be “combined with effective and expedient controls to eliminate abusive practices. However, such an essential equilibrium is sadly lacking in the draft law.” DT didn’t return a call for comment.
The VATM also said the new Telecom Act should: (1) Define the dominant carrier’s basic duty in providing access “in clear legal principles.” (2) Expand mandatory rules and reduce optional rules in the access regulations: “The decisions of the Regulatory Authority for Telecommunications & Postal Matters can only be reliable and uniform if a clear legal framework is in place. Discretionary freedom would only result in numerous lawsuits and create investment uncertainty in the marketplace.” (3) Regulate access to wholesale and retail products so that it was “efficient” and “plannable,” and make them subject to a consistent rate schedule. (4) Broaden the list of criteria used to calculate the rate of return on equity to include economic criteria. (5) Develop a clear definition of what constituted abuse. (6) Raise the upper limit for fines for violations and add a saving clause based on antitrust law.
(7) Bring the control powers of the Regulatory Authority in line with the requirements of the EU Access Directive. (8) Dismiss the introduction of a financial telecom contribution to cover the costs of the Regulatory Authority. (9) Reject the provisions requiring that providers bear the entire cost of implementing technical surveillance equipment.