Court Accepted Argument of President of the Office of Telecommunications and Post Regulation (URTiP) in the Litigation Opposing Netia Telecom Lublin and TP S.A. - UKE

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Court Accepted Argument of President of the Office of Telecommunications and Post Regulation (URTiP) in the Litigation Opposing Netia Telecom Lublin and TP S.A.


2003-06-02

On 27 May 2003, the Court for Competition and Consumer Protection dismissed an appeal of incumbent operator, Telekomunikacja Polska S.A. (TP SA), against a decision issued by the President of the URT (currently URTiP) on amendment to the interconnection agreement between TP SA and Netia Telecom Lublin S.A. Thus the settlement entitles Netia Lublin to offer to TP SA subscribers Internet access services in the Lublin area numbering zone.

The proceeding was initiated by the appeal of TP SA against the decision of the President of URT of 15 February 2002 in which the regulator enabled TP SA subscribers to benefit from the offer of the ISPs connected to the network of NETIA Lublin SA.  Moreover the President established the accounting principles between these operators.

The above-mentioned settlement (dismissing the appeal of TP SA and upholding the decision of the President of URTiP) significantly strengthens position of the regulatory body. The settlement is also important for the fulfillment of the main aims of the Telecommunications Law, which is among others, support for fair and effective competition in the market of telecommunications services.

Argumentation of TP S.A.

In the course of appeal proceeding, TP S.A. pointed out a number of alleged infringements of substantive as well as procedural law provisions. In particular the operator alleges that at the moment of issuance of the decision, TP S.A. did not have formally the status of the dominant operator yet. Therefore the President of URTiP was not entitled to interfere “imperiously” in the relations between the two operators.

Moreover TP S.A. argued that it was unacceptable to employ a comparative method for setting the interconnection price by the President of URTiP, based on the regulation of the Minister of Post and Telecommunications of 9 September 1999 on general conditions of interconnection and the rules of accounting.  According to TP S.A.  the above-mentioned regulation is in breach with art. 80 item 1 of Telecommunication Law so in this case a cost method rather than comparative one should be used.

In terms of infringements of administrative proceeding rules, TP S.A. accused the President of the URTiP of both not sufficient consideration of the facts and irrelevant premises.

Resolution Of the Court

In the course of appeal proceeding, President of the URTiP argued that all charges put forward by TP S.A. are groundless.

In the reasoning for the settlement, the Court emphasized that it upholds the decision issued by the President of URTiP and fully shares his arguments along with his interpretation of relevant Telecommunication Law provisions.

The Court affirmed all the charges put forward by TP SA to be unfounded and stated that at the time when the decision was issued TP SA was a public operator.

The Court shared also the position of President that the provisions of article 85 of Telecommunication Law constitute a self-contained base for President to interfere in contractual relations established between the operators. Furthermore, the Court judged legitimate the comparative method (benchmarks) as the basis to set the interconnection price. The Court added that this method remains in accordance with the EU standards regarding transparency and objectivity. The Court stressed also the pointlessness of the accusations regarding non-application of the cost method by President of the URTiP. According to the Court, TP S.A. did not present any arguments indicating that the rates set by President of the URTiP would not cover the justified costs. Moreover TP S.A. did not propose any model of cost calculation either in the course of administrative proceeding or before the Court.

Furthermore, the President of URTiP set the same principles of invoicing as applied to date by TP S.A. and added that the obligation put on TP S.A. to include the services provided by different operators in one invoice is not contrary to tax law provisions.

The Court for Consumer and Competition Protection fully accepted arguments of President of the URTiP and affirmed his remit to issue decisions and the rightness of content-related settlement. According to the President, Witold Graboś, The Court, as a body making legal appraisal of issued decisions, indicates both legitimacy of the regulator’s decision and  the rightness of its interpretation of Telecommunication Law.  It will be reflected while instituting next proceedings before the Office of Telecommunications and Post Regulation.

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