Assessment of significant market power under the EU's new electronic communications regime

The European Commission issued its Guidelines on the assessment of market power in the electronic communications sector on 9 July 2002.

The new Guidelines provide important clarification for the assessment by national regulatory authorities (NRAs) of significant market power (SMP). This is a very important concept in the new EC Electronic Communication Directives adopted on 7 March which must be brought into force at national level by 25 July 2003. Under the new regime, NRAs can impose regulatory objections on undertakings having SMP, but cannot do so if there is effective competition, i.e. if no undertaking in the market has SMP.

The Guidelines cover the definition of relevant product and services markets, the assessment of SMP and the imposition by NRAs of regulatory obligations on undertakings having SMP. Under the new EC Directive 2002/21 on the regulatory framework for electronic communications services, SMP now equates to a dominant position in the competition law sense (Article 82 EC) and NRAs will now be able in particular to impose obligations on SMP undertakings, to ensure effective access and interconnection, under Directive 2022/19 in addition to being able to ensure effective unbundled access to the local loop (under EC Regulation 2887/2000). The new Guidelines are therefore of central importance to the new e-communications regime.

These Guidelines have been prepared pursuant to the new Framework Directive, together with the new E-communications Directives on Access and Interconnection (Directive 2022/19), Authorisation (2002/20) and Universal Service (2002/22), will be supplemented by a further Council Directive on the Processing of Personal Data and the Protection of Privacy and also a consolidating Commission Directive on Competition (abolition of special and exclusive rights). This package will replace the existing telecommunications directives.

For further information, please contact Richard Eccles on +44 20 7367 3996 or by email at [email protected].