TELECOMMUNICATIONS BILL
Article 6
After chapter II of title I of book II of the Posts and Telecommunications Code there shall be inserted chapter III and IV, worded as follows:
"Chapter III
Public service obligations Art. L. 35 The public telecommunications service shall be provided in accordance with the principles of equality, continuity and adaptability. It shall comprise:
a) - the universal telecommunications service defined, provided and financed under the conditions set out in articles L. 35-1 to L. 35-4;
b) - the mandatory telecommunications services defined and provided for under the conditions set out in article L. 35-5;
c) - telecommunications activities undertaken in the public interest, particularly in the interests of national defenc and public security, public research and higher education, under the conditions set out in article L. 35-6.
Art. L. 35-1 The universal telecommunications service means the provision to the public of a quality telephone service at an affordable price. It includes the conveyance of telephone calls to and from subscriber points, the provision of an information service and a telephone directory in both printed and electronic form, the provision throughout the territory of public pay phones installed on the public domain and the conveyance of emergency calls free of charge.
The universal service shall be provided under tariff and technical conditions which enable social categories with special needs, such as low income users and disabled users, to access the service.
Any person who so requests may obtain a subscription to the telephone service from an operator responsible for the universal service under the conditions provided for by this code. A landlord or his agent may not oppose a telephone installation requested by a bona fide occupant or tenant.
Art. L. 35-2 I - An operator may be given the responsibility of providing the universal service if it agrees to provide the service to the whole of the country and is capable of doing so.
France Télécom shall be the public operator responsible for the universal service. The schedule of conditions incumbent on the operator responsible for providing the universal service shall be established after consultation with the public service commission for posts and telecommunications. These conditions shall govern the provision of the universal service, and in particular the tariff obligations required to ensure the access of all social categories to the universal service and to avoid discrimination based on the geographical location of subscribers. It shall also determine the conditions under which the universal service tariffs and quality of service are controlled.
II - The conveyance of emergency calls free of charge shall be compulsory for all public telephone service providers.
Art. L. 35-3 I - The cost of universal service obligations shall be calculated on the basis of an appropriate cost accounting system put in place by operators and audited, at their expense, by an independent body designated by the telecommunications regulatory authority.
II - The costs attributable to universal service obligations shall be financed by public network operators and public telephone service providers under the following conditions.
1) The net costs of tariff averaging obligations, corresponding on the one hand to geographical price averaging obligations and on the other hand to the current unbalanced telephone tariff structure, shall be financed by a charge levied in addition to and in the same way as the interconnection charge referred to in article L. 34-8, by the operator responsible for the universal service.
This additional charge shall constitute the remuneration for the universal provision of the network and telephone service. It shall be calculated in proportion to the telecommunications traffic volume of the operator requesting interconnection. The telecommunications regulatory authority shall propose the sum payable for interconnection to be set by the telecommunications minister.
2) - A universal telecommunications service fund shall be created. The accounts and finances of the fund shall be administered by the Caisse des dépôts et consignations (hereinafter referred to as the "deposit and consignment office") in a specifically designated account. The expenses incurred by the deposit and consignment office for such management shall be paid out of the fund.
The fund shall be used to finance the net costs of the following universal service obligations: the offer referred to in paragraph 2 of article L. 35-1 of special tariffs for certain subscriber categories in order to guarantee the accessibility of the service; the provision of public pay phones throughout the territory; the universal directory and the corresponding information service.
If an operator agrees to offer special tariffs to certain subscriber categories in order to guarantee them access to the telephone service under the conditions set out in its schedule of conditions, the net cost of this offering shall be deducted from its contribution.
In the event of the default of an operator, the telecommunications regulatory authority may impose a penalty in accordance with the provisions of article L. 36-11.
3) - The public operator shall gradually rebalance telephone tariffs to correct the disequilibrium resulting from the current telephone tariff structure. When rebalancing has been completed the additional charge referred to in 1) above shall no longer be levied and the net cost of the geographic price averaging obligation shall be financed by the fund mentioned in 2) above.
The transition to this new regime for financing shall be decided by the telecommunications minister, on the advice of the telecommunications regulatory authority following the opinion of the public service commission for posts and telecommunications.
III - The methods used to calculate, offset and share the net costs of universal service obligations shall be published at least one year before the use thereof.
IV - A State Council decree shall stipulate the terms of application of this article. It shall also establish the methods for evaluating, offsetting and sharing the net costs of the universal telecommunications service, as well as the terms of management of the universal telecommunications service fund.
Art. L. 35-4 A universal directory shall be made available to the public in both printed and electronic form, as well as a universal information service. Subject to protection of personal data, these shall provide access to the telephone numbers and addresses of all public network subscribers.
An entity legally distinct from the companies providing telecommunications goods and services shall establish and update the list required for publication of the universal directory. Public network operators and public telephone service providers shall be required to provide the said entity with their lists of subscribers.
A State Council decree shall determine the terms of application of this article. In particular, it shall determine the name of the entity, the guarantees required to ensure the confidentiality of data, particularly with regard to the commercial interests of operators, and protection of personal privacy.
Art. L. 35-5 Mandatory services shall include access, throughout the country, to the integrated services digital network, leased lines, packet switched data services, enhanced voice telephony services and telex.
The schedule of conditions incumbent on the operator responsible for the universal service shall determine which of the mandatory services it shall be required to provide and the conditions governing the provision thereof.
France Télécom shall provide all the mandatory services refrred to in the first paragraph.
Art. L. 35-6 The services required in the interests of national defence and public security and the fair payment due for these services shall be determined, at the request of the State, by the schedule of conditions incumbent on the licensed operators, in application of articles L. 33-1 and L. 34-1.
The State shall be responsible for higher education in the field of telecommunications and shall also assume financial responsibility thereof as of the beginning of 1997, under the conditions provided for in the Finance Acts.
Public telecommunications research shall be carried out under the control of the State, by the State or on behalf of the State.
Art. L. 35-7 Every five years, after public consultation and the opinion of the telecommunications regulatory authority and the public service commission for posts and telecommunications, a report on this chapter shall be submitted by the Government to Parliament. This report shall propose, where appropriate, the inclusion of new services in the scope of the universal service and the review of the list of mandatory services, in order to take into account developments in telecommunications technology and services.
Chapter IV
Regulatory framework for telecommunications Art. L. 36 There shall be established a telecommunications regulatory authority
as of 1 January 1997.
Art. L. 36-1 The telecommunications regulatory authority shall consist of a chairman and of two other members, appointed by decree, according to their legal, economic and technical expertise, for an irrevocable term of six years.
One third of the members of the telecommunications regulatory authority shall be renewed every two years. If a member is not able to complete his term of office, the member appointed to replace him shall hold office for the remainder of the term of the person he is replacing.
The chairman of the first telecommunications regulatory authority shall be appointed for a term of six years. The term of office of the two other members shall be determined by the drawing of lots. One of the members shall be appointed for a term of 4 years and the other for a term of 2 years.
Members of the authority shall not be eligible for reappointment. However, this rule shall not apply to members who have held office for a term not exceeding two years, as a result of the measure provided for in the above two paragraphs.
Art. L. 36-2 This office shall be incompatible with any other professional activity and any direct or indirect interest in a company in the telecommunications, broadcasting and information technology sectors.
The members of the authority shall not disclose any information pertaining to their activities.
The chairman and the other members of the telecommunications regulatory authority shall receive respectively a salary equal to that pertaining to the two highest senior administration grades for civil servants.
Art. L. 36-3 The telecommunications regulatory authority shall be provided with staff placed under the authority of its chairman.
The telecommunications regulatory authority may employ civil servants currently in post, under the same conditions as the telecommunications ministry. The telecommunications regulatory authority may recruit contractual staff.
The staff employed by the telecommunications regulatory authority shall not disclose any facts, acts and information brought to their knowledge during the performance of their functions.
Art. L. 36-4 The resources of the telecommunications regulatory authority shall include payment for services provided, and the taxes and fees payable under the conditions set out by the Finance Act or by State Council decree.
During the drafting of the annual Finance Act, the regulatory authority shall submit to the telecommunications minister its proposals for the funds needed to carry out its functions, over and above the resources referred to in the first paragraph.
These funds shall be included in the general State budget. The provisions of the law of 10 August 1922 on the control of expenditure shall not be applicable to the management thereof.
The chairman of the telecommunications regulatory authority shall have the power to authorise expenditure. He shall submit the accounts of the telecommunications regulatory authority to the Revenue Court for auditing.
Art. L. 36-5 The telecommunications regulatory authority shall take part in drafting the enactments and regulations governing the telecommunications sector and shall enforce the application thereof. It shall be consulted on decrees relating to the telecommunications sector and shall participate in the implementation thereof.
At the request of the telecommunications minister, the telecommunications regulatory authority shall participate in the preparation of the French position in international negotiations on telecommunications issues. At the request of the minister, it shall participate in representing France in the relevant international and European Union organisations.
Art. L. 36-6 In accordance with the principles of this code and its enforcement orders, the telecommunications regulatory authority shall set out the regulations governing the following:
1) - the rights conferred and obligations arising out the operation of the various categories of networks and services, in accordance with articles L. 33-1 and L. 34-1;
2) - the provisions applicable to the technical and financial conditions governing interconnection, in compliance with article L. 34-8;
3) - the technical rules applicable, where appropriate, to networks and terminal equipment to ensure interoperability, the portability of terminals and the efficient use of scarce resources;
4) - the conditions for establishing the networks referred to in articles L. 33-2 and
L. 33-3.
Decisions taken in accordance with this article shall be published in the French Official Journal, after approval by an order of the telecommunications minister.
Art. L. 36-7 The telecommunications regulatory authority shall:
1) - examine, on behalf of the telecommunications minister, the licence applications made pursuant to articles L. 33-1 and L. 34-1; issue other licences and receive declarations required by chapter II; when licences are granted following a call for applications, the telecommunications regulatory authority shall publish the outcome of the selection procedure;
2) - issue or have issued the certificates of conformity provided for in article L. 34-9;
3) - enforce the fulfillment of obligations incumbent on operators resulting from the legislative and regulatory provisions applicable thereto and the licences which have been issued, and penalise any breach thereof under the conditions provided for in articles L. 36-10 to
L. 36-11;
4) - propose to the telecommunications minister, according to the principles and methods set out in article L. 35-3, the sum payable as the contribution to the funding of universal service obligations and supervise the corresponding financing mechanisms.
5) - deliver a public opinion on universal service tariffs, multi-annual tariff objectives and tariffs for services for which there are no competitors on the market, prior to their approval, where appropriate, by the telecommunications minister and the minister for the economy.
6) - allocate to operators and users, under objective, transparent and non-discriminatory conditions, the frequency and numbering resources needed for their activity, and ensure that they are used efficiently.
7) - after consultation with the competition authority, draw up an annual list of the operators and markets concerned by the provisions of article L. 34-8 II, which are considered to have a significant market power. An operator with a share of more than 25% of a particular telecommunications market shall be presumed to enjoy significant market power. This shall also be determined by taking into account the operator's turnover relative to the size of the market, its control of the means of access to end-users, its access to financial resources and its experience in providing products and services in the market.
Art. L. 36-8 I - In the event of an interconnection refusal, a failure of commercial negotiation or a dispute over the conclusion or execution of an interconnection or telecommunications network access agreement, an aggrieved party may call on the telecommunications regulatory authority to resolve the dispute.
After having invited the parties to make their observations, the telecommunications regulatory authority shall issue a determination, within a period set by State Council decree. The decision shall be fully reasoned and shall specify the fair technical and financial conditions governing interconnection or special access.
In the event of a breach of the rules governing the telecommunications sector the telecommunications regulatory authority may take conservatory measures in particular to guarantee the continuity of network operations.
The telecommunications regulatory authority shall publish its decisions, subject to regulatory provisions on confidentiality. It shall notify the parties concerned and the minister for the economy.
II - The telecommunications regulatory authority may be called on to settle disputes
concerning:
1) the conditions laid down in the last paragraph of article L. 34-4, governing the conformity with arrangements which prohibit or restrict the provision of the telecommunications services over the networks referred to in the first paragraph of the said article;
2) the conditions and possibilities of operators sharing facilities installed on the public domain, as provided for in article L. 47.
The telecommunications regulatory authority shall resolve disputes according to the conditions and procedures provided for in I.
III - An appeal may be made for the cancellation or reversal of the decision taken by the telecommunications regulatory authority in application of I and II, within one month of notification thereof.
The minister for the economy may only appeal on the grounds of the provisions of articles 7 and 8 of order n° 86-1243 of 1 December 1986 on the freedom of pricing and competition.
Appeal shall not be suspensive. However, execution of the decision may be deferred, if it is likely to lead to obviously excessive consequences or if new circumstances of exceptional gravity have arisen since notification thereof.
Conservatory measures taken by the telecommunications regulatory authority may be subject to an appeal or judicial review within 10 days of notification thereof. This appeal shall be judged within one month.
IV - An appeal lodged against the decisions or conservatory measures taken by the telecommunications regulatory authority, in application of this article, shall fall within the jurisdiction of the appeal court of Paris.
An appeal lodged against an order of the appeal court shall be made within one month following the notification thereof.
Art. L. 36-9 A natural or artificial person, professional organisation or the telecommunications minister may call on the telecommunications regulatory authority to undertake conciliatory measures in order to settle a dispute between operators not concerned by article L. 36-8. Conciliation shall be favoured to all other solution.
The telecommunications regulatory authority shall inform the competition authority that the conciliation procedure has been initiated. If the same matter is referred to the competition authority, the latter may decide to suspend judgment.
If conciliation fails, the chairman of the telecommunications regulatory authority shall refer the matter to the competition authority, if the matter falls within its jurisdiction.
Art. L. 36-10 The chairman of the telecommunications regulatory authority shall refer any abuse of a dominant position or any anti-competitive practice in the telecommunications sector, which may be brought to his notice, to the competition authority. He may also seek advice from the competition authority on all other matters within its jurisdiction. The competition authority shall bring to the notice of the telecommunications regulatory authority of any matters referred to it which lie within its jurisdiction and shall seek the telecommunications regulatory authority's advice on practices which have been referred to it in the telecommunications sector.
The chairman of the telecommunications regulatory authority shall inform the public prosecutor of any matters which may constitute a criminal offence.
Art. L. 36-11 The telecommunications regulatory authority may impose penalties, at the request of the telecommunications minister, a professional organisation or a natural or artificial person, or as a matter of course if a default is observed on the part of network operators or telecommunications service providers in relation to legislative and regulatory provisions pertaining to their activity, or to decisions taken to guarantee the implementation thereof. This power to impose penalties shall be administered subject to the following conditions:
1) - when a network operator or a service provider violates a legislative or regulatory provision pertaining to its activity, or in respect of which it exercises its activity, the telecommunications regulatory authority shall summon it to remedy the matter within a stipulated period of time. It may make such a summons public.
2) - when a network operator or a service provider does not comply with a decision taken in application of article L. 36-8 or the summons provided for in point 1) within the period of time stipulated, the telecommunications regulatory authority may pronounce one of the following penalties against it:
a) depending on the gravity of the default, either total or partial suspension of the licence for one month maximum, reduction in the duration of the licence up to one year, or withdrawal of the licence;
For licences subject to the provisions of III of article L. 33-1 the licence may be withdrawn without prior summons, in the event of a substantial change in the composition of the share capital.
b) or, if the default does not constitute a criminal offence, a fine may be levied in proportion to the gravity of the default and to the advantages which it affords. The fine shall not exceed 1% of turnover, increased to 3% in the case of a repeated default of the same obligation. In the absence of sufficient activity to determine this threshold, the penalty may not exceed one million French francs, increased to two million French francs in the case of a repeated breach of the same obligation.
The penalties shall be imposed after the operator has received notification of the grounds for complaint, has been given the possibility of consulting the case file and has presented written and verbal comments.
Fines shall be recovered as State debts, independently from taxes and public property.
3) - Matters dating back more than three years may not be referred to the telecommunications regulatory authority if no action has been taken in view of an inquiry, verification or penalty.
4) - Decisions shall be fully reasoned, notified to the interested party and published in the French Official Journal. They may be the subject of an appeal to the State Council or of an application for stay of execution. Where fines are concerned, applications for stay of execution shall be suspensive.
Art. L. 36-12 The chairman of the telecommunications regulatory authority shall have the capacity to institute legal proceedings pertaining to the accomplishment of his functions.
Art. L. 36-13 The telecommunications regulatory authority shall gather the information and carry out the inquiries necessary for the accomplishment of its missions, within the limits and under the conditions set out in article L. 32-4.
Art. L. 36-14 The telecommunications regulatory authority shall draw up and make public an annual report on the performance of its functions and on the application of the legislative and regulatory provisions for telecommunications. This report shall be submitted to the Government and to the chairpersons of the two parliamentary chambers - the Sénat and the Assemblée Nationale. In the report, the telecommunications regulatory authority may suggest legislative or regulatory amendments which appear to be called for due to evolutions in the telecommunications sector and the development of competition.
The telecommunications regulatory authority may be heard by the standing committees on telecommunications of the Sénat and the Assemblée Nationale.
The telecommunications regulatory authority may commission expert evaluations, conduct studies, collect data and carry out any action required to obtain information on the telecommunications sector.