EC adopts guidelines on telecommunication regulation

The European Commission adopted guidelines on market analysis and the assessment of so-called significant market power in the telecommunications industry on Tuesday.

The guidelines set out the principles that national regulatory authorities (NRAs) will use to define markets and analyze effective competition. The guidelines were developed on the basis of existing case law and E.U. competition law, the Commission said.

The guidelines are a joint initiative of Mario Monti, Commissioner for Competition, and Erkki Liikanen, Commissioner for Enterprise and the Information Society.

They fit in to the new regulatory framework for the telecommunications industry that will be completed next year. The new laws require the Commission to adopt guidelines on market definition and the assessment of significant market power for NRAs to use to police competition in their national markets.

The new laws also grant the European Commission a veto power over competition decisions by the NRAs.

The guidelines instruct the NRAs to apply competition rules in situations where there is one company with significant power in a market. Conversely, where competition is effective and no operator is deemed to have significant market power, regulators are obliged to remove any obligations imposed on carriers previously deemed dominant under the current regulatory framework.

The guidelines are based on the relevant case law of the European Court of Justice and on the Commission’s own decision-making practice in defining the relevant market and applying the concept of single and collective dominance, in particular with regard to electronic communications markets, the Commission said.

It added that other competition law notions, such as “leveraging of market power”, are also addressed in the guidelines.