Antitrust: Commission takes Bulgaria to Court over assignment of digital terrestrial broadcasting authorisations

Brussels, 25-1-2013 — /europawire.eu/ — The European Commission has decided to refer Bulgaria to the EU’s Court of Justice over the assignment of digital broadcast spectrum. The Commission found that the procedure followed by Bulgaria was based on disproportionately restrictive award conditions, leading to the exclusion of potential candidates. This hampers competition in the future Bulgarian digital terrestrial television (DTT) infrastructure market, in breach of the applicable EU Directives on electronic communications (see background).

The efficient reallocation of radiospectrum as a result of the transition from analogue to digital broadcasting (the ‘digital dividend’) is part of the EU’s policy objectives under the Digital Agenda. In order to ensure that this process leads to the entry of new players capable of enhancing competition in the market and expanding viewer choice, the Commission has adopted a set of rules for the allocation of this extra spectrum capacity (the “competition”, “authorisation” and “framework” Directives, see background). These rules require that spectrum is allocated under open, transparent, objective, non-discriminatory and proportionate criteria.

The Commission considers that Bulgaria did not comply with the requirements of the Competition Directive when it assigned in 2009 the five spectrum lots available via two contest procedures, limiting without justification the number of companies that could potentially enter the market. Moreover, the selection criteria of the contest procedures were disproportionate, refusing applicants that had links with content providers (TV channels operators), including operators active only outside Bulgaria, or with broadcasting network operators, in breach of the three directives.

In March 2012, the Commission requested the Bulgarian authorities to address the breach of EU law and allow effective entry into the Bulgarian DTT infrastructure market. Bulgaria had announced the launch of a new tender procedure for the assignment of further spectrum. However, this spectrum will not be available before 1 September 2013, date of the analogue switch off. It is expected that current TV channels will enter into agreements with broadcast network operators before the switchover so as to be broadcast on the new DTT infrastructure on that date. There is a strong likelihood that there will be no business case for an operator entering after that date. The Commission has therefore decided to refer Bulgaria to the Court.

Background

In May 2011, the Commission initiated infringement proceedings against Bulgaria for the assignment of broadcasting spectrum by sending a letter of formal notice. As there was no improvement of the competitive situation, the Commission sent Bulgaria a reasoned opinion, detailing its objections in March 2012. Notwithstanding Bulgaria’s announcement of a new tender procedure, no further spectrum is expected to be assigned before 1 September 2013, the date of the analogue switch off. Today’s decision therefore refers Bulgaria to the ECJ, as the third and last step in EU infringement proceedings under Article 258 TFEU.

The Commission has also intervened regarding the assignment of digital broadcasting spectrum in other Member States, notably in Italy (see IP/06/1019) and in France (see IP/11/1115).

The following EU legislation applies:

Commission Directive 2002/77/EC of 16 September 2002 on competition in the markets for electronic communications networks and services (‘Competition Directive’), Official Journal L 249, 17.9.2002, pp. 21-26.

Directive 2002/20/EC of the European Parliament and of the Council of 7 March 2002 on the authorisation of electronic communications networks and services (‘Authorisation Directive’), Official Journal L 108, 24.4.2002, pp. 21-32.

Directive 2002/21/EC of the European Parliament and of the Council of 7 March 2002 on a common regulatory framework for electronic communications networks and services (‘Framework Directive’), Official Journal L 108, 24.4.2002, pp. 33-50.

Current figures on infringements in general can be found here.

On the January infringement package decisions, see MEMO/13/22

On the general infringement procedure, see MEMO/12/12