Competition Law and Regulation in European Telecommunications

by Larouche, Pierre

• ISBN13: 9781841131443
• ISBN10: 184113144X
• Format: Hardcover
• Copyright: 2000-05-24
• Publisher: Hart Publishing

Summary

Using numerous practical examples,this book examines the evolution of EC telecommunications law following the achievement of liberalisation, the main policy goal of the 1990s. After reviewing the development of regulation in the run-up to liberalisation, the author identifies the methods used to direct the liberalisation process and tests their validity in the post-liberalisation context. A critical analysis is made of the claim that competition law will offer sufficient means to regulate the sector in the future. Particular emphasis is given to the way in which EC Competition Law changed in the 1990s using the essential facilities doctrine, an expansive non-discrimination principle and the policing of cross-subsidisation to tackle what were then thought of as regulatory matters. Also examined within the work is the procedural and institutional interplay between competition law and telecommunications regulation. In conclusion, Larouche explores the limits of competition law and puts forward a long-term case for sector-specific regulation, with a precise mandate to ensure that the telecommunications sector as a whole fulfils its role as a foundation for economic and social activity.

Author Biography

Pierre Larouche is a lecturer at the University of Maastricht.

Table of Contents

Preface	xi
Table of Frequently Cited Materials	xiii
Table of Abbreviations	xv
Table of Cases	xx
Table of Legislation	xxviii
Introduction	xxxv
The Successive Regulatory Models
The Starting Model (Until 1990)	1	(2)
The Regulatory Model of the 1987 Green Paper (1990-1996)	3	(16)
History and legislative instruments	3	(4)
Key concepts and distinctions	7	(1)
Regulatory and operational functions	7	(1)
Services and infrastructure	7	(2)
Reserved and non-reserved services	9	(5)
Access and interconnection	14	(3)
Modifications between 1990 and 1996	17	(2)
The Transitional Model of The 1992 Review and The 1994 Green Paper (1996-1997)	19	(3)
History	19	(1)
Alternative infrastructure	20	(1)
Legislative instruments	21	(1)
The Fully Liberalized Model (1998-)	22	(13)
History and legislative instruments	22	(2)
The model of Directive 96/19	24	(2)
The model of the new ONP framework	26	(4)
Main substantive elements	30	(1)
Universal service	31	(2)
Interconnection	33	(1)
Licensing	34	(1)
Conclusion	35	(2)
The ``Hard Core'' Of Regulation And Article 86 EC
The Integration of Articles 86 and 95 EC in the Run-up to Liberalization	37	(54)
The Starting Positions	37	(2)
The position of the Commission	39	(3)
The position of the Council	42	(1)
The position of the European Parliament	43	(1)
The Compromise of December 1989	43	(5)
The Legal Assessment of the ECJ	48	(5)
The use of Article 86(3) EC as a Legal Basis After 1990	53	(7)
The Integration of Articles 86(3) and 95 EC in an Original Legislative Procedure	60	(1)
``Liberalization'' and ``harmonization'' directives	61	(1)
The first phase	61	(1)
The second phase	62	(1)
Article 86 EC directives as the hard core of EC telecommunications law	63	(6)
Resulting procedure	69	(1)
Concrete Examples	70	(1)
Universal service	71	(5)
Interconnection	76	(1)
A priori categorizations in Directive 97/33	77	(3)
Implementation in France	80	(2)
Implementation in Germany	82	(4)
Individual licenses	86	(3)
Conclusion	89	(2)
The Use of Article 86(3) EC in a Liberalized Environment	91	(17)
Article 86(1) EC	91	(1)
Public undertakings	91	(4)
Special and exclusive rights	95	(5)
The need for ``mischief'' (Zweckmaigkeit) analysis	100	(5)
Article 86(2) EC	105	(3)
Conclusion	108	(4)
The New Competition Law As Applied In The Telecommunications Sector
Sources and Epistemology	112	(17)
Sources of EC Competition Law	112	(3)
A Model for the Legitimacy of EC Competition Law	115	(12)
The 1991 Guidelines and 1998 Access Notice	127	(2)
Relevant Market Definition	129	(36)
Substitutability Patterns	132	(2)
Relevant Markets in a Network-Based Industry	134	(1)
The case-law on the relevant product market in the air transport sector	135	(1)
The implications for the telecommunications sector	136	(4)
Resulting Approach and Assessment of the Decision Practice of the Commission	140	(1)
An original approach to market definition in telecommunications	140	(3)
The decision practice of the Commission	143	(1)
General principles set out under the MCR	143	(2)
Market definition in the alliance cases	145	(3)
Concert (BT/MCI, first phase)	148	(5)
Atlas/GlobalOne	153	(6)
Unisource/Uniworld	159	(1)
BT/MCI II	160	(3)
Conclusion	163	(2)
Substantive Principles	165	(103)
Refusal to Deal and the ``essential facilities'' doctrine	165	(2)
ECJ case-law on refusal to deal	167	(4)
The essential facilities doctrine in United States law	171	(8)
The introduction of the essential facilities doctrine in EC competition law by the Commission	179	(9)
The reaction of the ECJ and CFI to the essential facilities doctrine	188	(8)
A cost-benefit analysis of refusal to deal and essential facility cases	196	(7)
From classical to bottleneck cases	203	(8)
Conclusion	211	(7)
Discrimination	218	(1)
The rise of a new discrimination pattern	218	(3)
Discrimination between customers	221	(4)
Discrimination between a third-party customer and a subsidiary	225	(5)
Conclusion	230	(1)
Pricing, Cross-subsidization and Accounting	231	(1)
Excessive and predatory pricing	231	(4)
Cross-subsidization	235	(4)
Costing and accounting in a multi-service sector such as telecommunications	239	(1)
Terms of the economic debate surrounding costing and pricing	240	(6)
Pricing and costing under the ONP framework	246	(5)
Pricing and costing in competition law	251	(4)
The 1998 Access Notice: towards a general principle of cost-oriented pricing for dominant firms under competition law?	255	(3)
Conclusion	258	(1)
Unbundling	259	(9)
Competitive Assessment	268	(15)
General principles concerning multi-market cases	268	(7)
The competitive assessment in Atlas	275	(1)
The markets for cross-border and Europe-wide services	276	(1)
The French and German markets for packet-switched data services	277	(1)
Overarching concerns	278	(2)
The competitive assessment in BT/MCI II	280	(3)
Procedural and Institutional Framework	283	(33)
Standard elements of the procedural and institutional framework	284	(1)
Procedural and institutional framework by source	284	(1)
National sector-specific regulation	284	(2)
National competition law	286	(1)
EC competition law	287	(1)
Relationship between those frameworks	288	(1)
National competition law and EC competition law	288	(4)
National competition law and national regulation	292	(1)
EC competition law and national regulation	292	(3)
Modifications resulting from competition law as applied in the telecommunications sector	295	(1)
Integration of EC competition law and national sector-specific regulation	295	(1)
The creation of an area of overlap between EC competition law and national sector-specific regulation	295	(3)
The relationship between the Commission and the NRAs	298	(4)
Use of EC competition law to compensate for gaps in sector-specific regulation	302	(1)
The regime of conditions and obligations under EC competition law	303	(5)
The distinction between conditions and obligations	308	(8)
Resulting procedural and institutional framework	316	(1)
Conclusion	316	(6)
Rethinking Sector-Specific Regulation
The Limits of Competition Law	322	(37)
The gaps of competition law	323	(1)
Competition in subscriber networks	323	(6)
The distribution of intelligence in networks	329	(2)
The challenges for competition law	331	(1)
Change in the market structure	331	(3)
Convergence	334	(5)
Globalization	339	(4)
The downsides of competition law	343	(1)
Uniformization	343	(4)
Lack of flexibility	347	(2)
Opaqueness	349	(4)
The legitimacy of using competition law as the core of EC telecommunications policy	353	(1)
Instrumentalization of competition law	353	(3)
Beyond liberalization	356	(3)
The Case for Sector-Specific Economic Regulation	359	(44)
The terms of the case	359	(3)
The Dual role of telecommunications	362	(6)
The core regulatory mandate	368	(1)
Supplier access	369	(5)
Customer access	374	(4)
Transactional access	378	(1)
Definition	378	(4)
The scope for regulatory intervention	382	(1)
Interplay of the preferences of firms	383	(5)
Network effects in a multi-layered industry structure	388	(5)
The parameters of regulatory intervention	393	(4)
Conclusion	397	(1)
The balance with competition law	398	(5)
Sector-Specific Regulation at the EC Level	403	(22)
The need for EC sector-specific regulation	403	(2)
Current status	405	(2)
Legal basis	407	(6)
Institutional implications	413	(1)
At the legislative level	413	(1)
At the level of individual decisions	414	(4)
At the policy-making and policy coordination level	418	(5)
Coordination with EC competition law	423	(2)
Conclusion	425	(4)
Conclusion	429	(12)
Postscript: The 1999 Review	441	(6)
Bibliography	447	(12)
Index	459