BEREC Opinion on Phase II investigation pursuant to Article 7a of Directive 2002/21/EC as amended by Directive 2009/140/EC: Case DE/2014/1605 Wholesale voice call termination on individual mobile networks (market 7) in Germany

On 20 May 2014, the Commission registered a notification from the German national regulatory authority, BNetzA, concerning the markets for wholesale voice call termination on individual mobile networks in Germany (corresponding to market 7 in the Commission’s Recommendation 2007/879/EC of 17 December 2007).
In the currently notified draft measure BNetzA proposes to impose on sipgate Wireless GmbH (sipgate) the maximum rates for mobile call termination (MTR), resulting from the application of the previously adopted national benchmarking measure, as well as the obligation to grant collocation. The proposed MTR is 1.79 €ct for the period 3 February – 30 November 2014. As a result of the proposed measure, the MTR under the present notification, whilst being symmetrical, will effectively rely on the same LRAIC+ methodology used for setting the MTRs of other SMP-operators on the relevant markets previously notified to the Commission.

The Commission has examined the notification and has concluded that the notified draft measure would affect trade between Member States and falls within Article 7a of the Framework Directive.

BEREC examined the draft measure and noted that symmetry is implemented. Nevertheless, analogous to the previous cases, DE/2013/1424 and DE/2013/1527, BEREC also considers for the present case that the Commission’s serious doubts are justified in that (i) BNetzA’s proposed MTRs are not based on a pure LRIC costing methodology, as recommended by the Commission, and (ii) BNetzA has not provided a valid justification for deviating from the TR Recommendation and in particular, has not provided evidence to support its view why this decision, when read with the previous decision to set MTRs at LR(A)IC+ or KEL, would be better suited to meet the policy objectives of promoting efficiency and sustainable competition and maximize consumer benefits than pure LRIC. BNetzA therefore did not prove that national circumstances justify the deviation from the recommended MTR costing methodology.

In addition, BEREC shares the Commission’s concerns that BNetzA’s proposal could create barriers to the internal market if other NRAs set MTRs based on the methodology recommended by the Commission (via a bottom-up model and by benchmarking) and BNetzA deviates from that methodology without valid justification.

The full text of BEREC’s Opinion is provided below.