On the legal action initiated by the Bucharest City Hall against Regulatory Authority (ANCOM) Decision 40/2019

ANISP makes the following statements related to the action opened by the Bucharest City Hall and the project company Netcity Telecom against ANCOM President’s Decision no. 40/2019, a decision correcting a number of abusive provisions met in the contracts for accessing the underground communications city infrastructure:

ANCOM Decision 40/2019 is a very important act for the communications sector development in Bucharest and nation-wide. Prior to adoption of ANCOM’s decision 40/2019, development of fiber optic communications networks was hampered by exaggerated access fees – by the Netcity Telecom project company.

Having a monopolistic position on the market for access to underground infrastructure and interpreting for its own benefit certain provisions of the concession contract executed with the General Council of Bucharest Municipality, the project company Netcity Telecom imposed tough technical and economic conditions on the business environment, obliged to comply under the threat of immediate dismantling of previously existing networks.

As a result, many of the alternative operators have disappeared and networks development has slowed down. Restricting competition in any sector leads to higher end-user rates and lower quality services.

Even some directions declared as priorities in governmental policies (Romania’s digitalization, 5G adoption, IoT, e-government, telemedicine etc) are endangered by unregulated monopolies / oligopolies. For example, in order to the fully take advantage of the 5G technology, it is necessary to construct high density networks having fiber optic backhaul. A prohibitive cost of installing optical fiber cancels the benefits of 5G.

In view of the above considerations, Law 159/2016, which transposes into Romania a European directive on the reduction of the cost of installing communications networks (Directive 2014/61/EU), was strictly necessary and its necessity has been manifested for many years. Law 159/2016 in turn imposed ANCOM, by art. 47. par. 9, to take regulatory action in such situations as the Netcity project.

The community of communications service providers grouped in ANISP considers ANCOM’s decision 40/2019 to be an important step in the right direction, in all relevant respects (for reasons of development of the strategic sector of electronic communications, for economic, social, legal reasons) . We also call on Bucharest City Hall not to look at this decision only from the narrow perspective of lowering (albeit not very significant, if any) its revenues from the corresponding royalty fee, to cancel the court action against ANCOM 40/2019 decision – and to support the development which will bring much more benefits to the inhabitants of Bucharest, both directly (through the services offered) and indirectly (through the taxes paid by the companies that will be able to develop once the monopolistic barriers are eliminated by ANCOM regulations).

We believe the chances of success in court for PMB’s action are very low, as there can be no solid reasoning for canceling ANCOM’s decision 40/2019; a waiver of this legal action means saving time and money.

Last but not least, ANISP expresses its support for the development of the Bucharest underground infrastructure (Netcity), but only under the provisions of Law 159/2016 and under the conditions legally imposed by the market arbitrator – ANCOM.

File references, according to the just.ro portal:

http://portal.just.ro/2/SitePages/dosar.aspx?id_inst=2&id_dosar=200000000370647

http://portal.just.ro/2/SitePages/dosar.aspx?id_inst=2&id_dosar=200000000370650