Key Benefits:
The Telecommunications Regulatory Authority,
Having regard to Directive 2002/22/EC of the European Parliament and the Council of 7 March 2002 on universal service and user rights in relation to electronic communications networks and services (the "universal service" directive);
Considering the Post and Telecommunications Code, including articles L. 35 to L. 35-8, L. 36-7, R. 10-8 and R. 20-31 to R. 20-44;
Having regard to Act No. 2003-1365 of 31 December 2003 on the Public Service Obligations of Telecommunications and France Télécom, in particular its article 9;
Having regard to Decree No. 96-1225 of 27 December 1996 approving the specifications of France Télécom;
In view of the Minister's request for advice to industry dated 9 June 2004;
After deliberating on 29 June 2004,
I. Context
Act No. 2003-1365 of 31 December 2003 on the obligations of the public service of telecommunications and France Télécom constitutes, in the case of universal service, the transfer of the above-mentioned "universal service" directive.
It maintains the structure of the public telecommunications service established in 1996, which distinguishes three components of the public service: the universal service, the mandatory services and the missions of general interest in defence, security, research and higher education.
The Autorité recalls that, in addition to the obligations to the carriers of universal service providers, there are general obligations related to public service obligations that weigh on all operators. Thus, on the occasion of the renewal of the licences of Orange France and SFR, and on the proposal of the Authority (see decision No. 2004-150 of 24 March 2004), the Minister has strengthened the obligations of mobile operators, including accessibility to service for persons with disabilities, protection of the environment and the sharing of radio sites, coverage of white zones, consumer protection through measures against theft of terminals.
The universal service, defined by the "Universal Service" directive, includes four components: the provision of quality fixed telephone service at an affordable price, the provision of an information service and annuary, access to telephone booths and special measures for the disabled. This content is likely to evolve as early as 2005, with the obligation of the European Commission under this directive to review the scope of universal service by July 2005.
This Act also introduces a new designation mechanism by which the Minister responsible for telecommunications designates for each component the attribute operator following a call for applications. Once designated, the operator in charge of one of the obligations of the universal service may be compensated by the universal service fund for the net cost of its obligations, as long as they constitute an excessive charge.
The decree submitted for advice to the Authority shall specify this new device in accordance with articles L. 35-1 to L. 35-3 of the Post and Telecommunications Code. It includes three categories of provisions: those relating to the definition of components, those relating to the procedure for the designation of operators in charge of one of the components of the universal service, and finally those relating to the calculation of the cost of universal service and the contributions of each operator.
II. - The provisions on the definition of components of the universal service (art. 2 of the draft decree)
The Autorité notes that draft article R. 20-30-1 provides, inter alia, an obligation for the operator in charge of the first component of the universal service, namely, the provision of high-quality, affordable telephone service, to provide free subscribers with selective outgoing calling services offered as part of its telephone service offer.
The Autorité considers that the list provided for in this article could be amended to create a selective appeal ban service in the following segmentation:
- national interpersonal calls to fixed networks. This category would include local, long distance, and non-geographical calls of type 087BPQMCDN. These three types of calls are relatively homogeneous in terms of use and pricing. The overcost between a local call and a long distance call tends to disappear and the tariff offers combining these three types of calls are common;
- national interpersonal calls to mobile networks. Given their specific nature and higher price levels, it seems legitimate to isolate calls to mobile phones by specifying that these are only national calls;
- international calls. These calls, whether they are to fixed or mobile networks, could be grouped in a separate category, given their different nature and the great variability of their price;
- calls to service providers. All calls to service providers, or calls to special numbers, could be grouped into a single category, the boundary between shared and shared revenue services becoming increasingly tenuous and the pricing of such communications being subject to no tariff reductions contrary to interpersonal communications;
- pay calls. Finally, a global call ban option to non-free numbers could also be added. Such an option would block all calls, with the exception of calls to 0800 free numbers and emergency services.
Under draft article R. 20-30-3, the obligations imposed on the designated operator in charge of the "publiphony" component were amended. Thus, this operator will now have to set up a cabin per commune and an additional one for municipalities with a population of between 1,000 and 2,500 inhabitants. This flexibility allows to adapt the obligations of the component to the reality of current telecommunications uses.
The Autorité notes that draft article R. 20-30-4 specifies the measures that the operator designated for one of the components of the universal service must adopt in favour of the disabled.
The Autorité considers that persons with disabilities should be able to benefit from such measures by all operators, whether or not they are in charge of one of the universal service obligations, and would welcome a law establishing such a general obligation. As long as such an obligation is general, it should not give rise to compensation.
III. - On the provisions of the calculation procedure
costs of universal service (arts. 3-13 of the draft decree)
On draft article R. 20-31:
Article 3 of the draft decree amends Article R. 20-31 of the Post and Telecommunications Code relating to the costs of universal service. The reference to section R. 20-34, relating to social tariffs, should be quoted in section R. 20-31 as it relates to the "telephone service" component and not to the "b" for components 2 and 3 of the universal service.
On draft article R. 20-33:
The Autorité welcomes the disappearance of the reference to non-profit subscribers in the cost assessment method for the geographic equalization obligations.
Such a reference is poorly reconciled with an area-by-zone assessment and can lead to paradoxical situations where the offset of the service of an area is less costly than that of a part of its subscribers, which discredits the device and is a source of litigation.
In this regard, the assessments carried out by the Autorité in the case of France Télécom have required the development of complex models which, despite the care that can be provided to their implementation, remain in a questionable and fragile nature; Thus, while the final assessment, based on the audited data, of the amount of this component was 5.1 million and 5.4 million euros (before taking into account intangible benefits) for the years 2000 and 2001, the forecast amount for the year 2002 was 56 million euros.
In addition, the Authority notes that the report to the Prime Minister proposes to delete the reference that: "Invest costs are based on the replacement costs calculated on the basis of the best industrially available technologies. »
The Authority agrees with this proposal, but considers it desirable to maintain the reference to a principle of efficiency. That is why the Autorité proposes to replace the last sentence of Article R. 20-33 with: "The costs taken into account are those of an efficient operator".
On draft article R. 20-37:
Article 8 of the draft decree amends section R. 20-37 to entrust the charge of calculating the rate of pay to the Authority alone.
The Autorité considers that it would be desirable that the methods for calculating this rate should also be amended to take into account the specificity of universal service delivery; Universal service activities have a lower risk because the operator is compensated, regardless of the extent of its deficit.
The Autorité therefore considers it desirable that the decree take note of the specificities of the universal service through a general formula, such as the one proposed in the annex.
On draft article R. 20-37-1:
Decree No. 2003-338 of 10 April 2003, which had introduced into the code the definition of intangible benefits, in order to bring France into line with the judgment of the Court of Justice of the European Communities of 6 December 2001, had resumed the benefits listed by the Commission in its communication COM (96) 608, dated 27 November 1996, on the evaluation criteria for national systems of calculating the cost and financing of the universal service in telecommunications states,
The Autorité notes that section 9 of the draft decree amends section R. 20-37-1 of the Post and Telecommunications Code to clarify that the list of the four immaterial benefits is no longer exhaustive and can therefore be enriched. The Autorité questions the objective of this amendment, which may open the way to new litigation. It therefore wishes that the decree avoids the use of the term "in particular", or, where appropriate, expressly specifies the additional benefits to be taken into account.
On draft article R. 20-39:
Draft article 11 amends section R. 20-39 of the Post and Telecommunications Code. It follows the definition of the turnover to be taken into account, excluding that generated for the carriage and distribution of radio or television services, in accordance with section L. 35-3, while also excluding that related to the operation of collective antennas.
The Authority questions the meaning of the concept of "collective antennas" and considers that it would be desirable that this term be clarified by the decree in order to avoid any ambiguity.
In the same context of clarification, the Autorité considers that it is necessary to specify that the " turnover" mentioned on various occasions is always the same, namely the turnover as defined in the second and third paragraphs of this article.
In addition, the Authority supports the existence of a mechanism to simplify the management of the universal service fund. It observes in this regard that the exemption threshold, set at 400,000 euros, appears low; it could lead a small business (less than 2 employees based on commonly observed ratios) to contribute by imposing disproportionate management charges; This is why the AMF considers that raising the threshold to five million euros would reduce the burden on companies in the sector without prejudice to a principle of equity, given the high concentration of the sector.
There is also, in any case, a need for the regulatory text to remove any ambiguity as to the mechanism; the Authority is in this respect favourable, for practical and fair reasons, to that the device conducts successively:
- first to isolate the operations involved in the financing, taking into account the exemption threshold;
- then distribute the financing charge between these operators.
Finally, the Autorité notes that the proposed device leads to threshold effects. It would seem preferable to put in place a deductible system, consistent with the legislative provisions, which would distribute the financing charges on the basis of the amount of revenue over the threshold.
The Authority has been able to estimate the effect of the various changes described above: they increase by less than 1% the contributions to the expense of the largest contributors relative to the scheme provided for in the draft decree.
In addition, the Autorité notes, in light of the report made to the Prime Minister on this point, that, even in the absence of a provision in this decree relating to the assessment of the excessive burden imposed by section L. 35-3 of the Post and Telecommunications Code, it will be up to the Authority to conduct this assessment. In the interests of legal security, it seems preferable to expressly entrust this jurisdiction to the Authority.
The other articles of the draft decree do not call any particular comment on the part of the Authority. Subject to the comments set out above and the editorial amendments made in the annex, the Authority shall issue a favourable opinion on the draft decree.
This notice and attached editorial proposals will be forwarded to the Minister Delegate to the Industry and published in the Official Journal of the French Republic.
Done in Paris, June 29, 2004.
A N N E X E
DRAFT DECRET FOR PUBLIC SERVICE OBLIGATIONS
AND FINANCING OF THE UNIVERSAL SERVICE OF THE
You can see the table in the OJ
n° 269 of 19/11/2004 text number 46
The president,
P. Champsaur
