Keywords
Summary

Keywords

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1. Competition - Public undertakings and undertakings to which the Member States have granted special or exclusive rights -- Powers of the Commission - Adoption of directives specifying in general terms the obligations of the Member States

(EEC Treaty, Art. 90(1) and (3))

2. Competition - Undertakings to which the Member States have granted special or exclusive rights - Compatibility with the Treaty of the rights conferred - No presumption to that effect

(EEC Treaty, Art. 90(1)

3. Competition - Public undertakings and undertakings to which the Member States have granted special or exclusive rights - Powers of the Commission by virtue of its duty of supervision and legislative powers of the Council

(EEC Treaty, Arts 87, 90(3) and 100a)

4. Free movement of goods - Quantitative restrictions - Measures having equivalent effect - Interpretation of Article 30 of the Treaty in the light of Articles 2 and 3 - Telecommunications terminals - Exclusive importation and marketing rights granted by the Member States - Not permissible - Corollary - Exclusive rights regarding the connection, bringing into service and maintenance of terminal equipment not permissible - Withdrawal legally required by Directive 88/301 - Obligation, in order to ensure equal opportunities between economic agents, to entrust the drawing up of technical specifications and type-approval of equipment to an independent body

(EEC Treaty, Arts 2, 3(f) and 30; Commission Directive 88/301, Arts 2, 3 and 6)

5. Competition - Undertakings to which the Member States have granted special or exclusive rights - Recourse to Article 90 of the Treaty in order to deal with anti-competitive conduct engaged in by undertakings on their own initiative - Illegality - Appropriate legal basis - Articles 85 and 86 of the Treaty

(EEC Treaty, Arts 85, 86 and 90; Commission Directive 88/301, Art. 7)

Summary

1. Article 90(3) of the Treaty empowers the Commission to specify in general terms, by adopting directives, the obligations imposed on the Member States by Article 90(1) as regards public undertakings and undertakings to which they have granted special or exclusive rights. That power, which is exercised without taking into consideration the situation prevailing in any particular Member State, differs by its very nature from that exercised by the Commission when seeking a declaration that a Member State has failed to fulfil a particular obligation under the Treaty.

2. The fact that Article 90(1) of the Treaty presupposes the existence of undertakings which have special or exclusive rights cannot be construed as meaning that such rights are necessarily compatible with the Treaty. They must be assessed in the light of different rules of the Treaty, to which Article 90(1) refers.

3. The subject-matter of the power conferred on the Commission by Article 90(3) of the Treaty, namely supervision of measures adopted by the Member States in relation to undertakings with which they have certain specific links, is different from, and more specific than, that of the powers conferred on the Council by either Article 100a or Article 87. Furthermore, the possibility that rules containing provisions which impinge upon the specific sphere of Article 90 might be laid down by the Council by virtue of its general power under certain articles of the Treaty does not preclude the exercise of the power which Article 90 confers on the Commission.

4. The grant by a Member State of exclusive importation and marketing rights in the telecommunications terminals sector is capable of restricting intra-Community trade and therefore constitutes a measure having an effect equivalent to a quantitative restriction within the meaning of Article 30 of the Treaty. In the first place, the existence of such rights deprives traders without such rights of the opportunity of having their products purchased by consumers, and secondly the diversity and technical nature of the products in that sector are such that there is no certainty that the holder of exclusive rights can offer the entire range of models available on the market, inform customers about the state and operation of all the terminals and guarantee their quality. Accordingly, Article 2 of Directive 88/301 rightly requires such rights to be withdrawn, whilst Article 3 sets limits thereto which are imposed by the requirements of safety, protection of networks and interworking of equipment.

Furthermore, Article 30 et seq. of the Treaty has to be interpreted in the light of Articles 2 and 3. Those articles set out to establish a market characterized by the free movement of goods where the terms of competition are not distorted, which means that the competition aspect of Article 3(f) has to be taken into account. In addition, if exclusive rights regarding the connection, bringing into service and maintenance of terminal equipment were retained, traders engaged in the marketing of such equipment might not be able to carry on business in conditions of competition which are not distorted, since there would be no certainty that the holder of those exclusive rights would be able to guarantee the reliability of those services for every type of terminal available on the market and the utilization of all those terminals, nor would he have any incentive to do so. Consequently the directive rightly requires those rights to be withdrawn also.

That same need to ensure that competition is not distorted and to secure equality of opportunity as between the various economic operators justifies the requirement laid down in Article 6 of the directive to the effect that Member States must entrust responsibility for drawing up technical specifications, monitoring their application and granting type-approval to a body independent of public or private undertakings offering competing goods and/or services in the telecommunications sector.

5. Where undertakings to which Member States have granted special or exclusive rights engage in anti-competitive conduct on their own initiative, Article 90 of the Treaty, which confers powers on the Commission only in relation to State measures, does not constitute an appropriate legal basis for requiring such conduct to be brought to an end. Such conduct can be called in question only by individual decisions adopted under Articles 85 and 86 of the Treaty.

Consequently, it is necessary to annul Article 7 of Directive 88/301, by which the Commission sought to require Member States to make it possible to terminate, with maximum notice of one year, leasing or maintenance contracts which concern terminal equipment subject to exclusive or special rights granted to certain undertakings at the time of the conclusion of the contracts, since it has not been established that the conclusion of long-term contracts, which are regarded as anti-competitive, was the result of encouragement or coercion on the part of the national authorities.