C-69/91
ECLI:EU:C:1992:240
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O P I N I O N O F MR TESAURO — CASE C-69/91
OPINION OF ADVOCATE GENERAL TESAURO delivered on 3 June 1992
Mr President, the prior authorization or type-approval of Members of the Court, the competent national bodies. 2
Introduction: disputes referred to the Court of Justice concerning the marketing of ter- minals without type-approval
Such a proliferation of judicial proceedings within what is, after all, a short space of time cannot be due to mere coincidence. On closer examination the dispute appears to be the tell-tale sign of tension manifesting itself — in some countries at least — over the mar- keting of terminals by independent operators The present case — like the Taillandier case (that is, operators unconnected with public (Case C-92/91 [1993], ECR 1-5383) in entities trading in the telecommunications which I am delivering my Opinion today — sector). Those tensions are attributable to the must be seen in the context of a series of process of liberalization which has taken requests for preliminary rulings, ' all arising place in recent years in the market for tele- from the same fact, namely the marketing communications terminals; it is a process (and in some instances, the mere possession) largely due to technological innovation and of telecommunications terminal equipment the consequent changes in economic and (usually telephones, cordless telephones and telefax equipment) which has not received
2 — There arc, obviously, differences between the various cases. Those differences do not, however, relate to the event at * issue, which is invariably the marketing of terminals without Original language: Italian. approval of the specific type of terminal under consideration 1 — Besides the present case and Taillandier, I would point out — a difference which sometimes carries implications for the RTT v GB-Inno-BM, on which judgment was delivered on scope of the national provisions which apply. 13 December 1991 (Case C-18/88 [1991] ECR I-5941) In addition, the event in question may clearly arise in the together with the references to the Court in Lagattchc (Case context of different legal relations, whether substantive or C-46/90 [1993] ECR I-5267, in which the Court decided procedural. For example, whereas the reference to the Court to reopen the oral procedure following the Opinion of in RTT v GB-Inno-BM arose from an action brought by a Advocate General Lenz), Evrard (Case C-93/91 [1993] competitor, namely the national telecommunications body, ECR I-5267), Sauges (Case C-164/91, still pending), which sought an injunction against a trader selling terminal Henryon and Others (Joined Cases C-238 to 240/91, still equipment without type-approval, this case derives from pending), Gleyzes (Case C-288/91, still pending) and criminal proceedings brought against a trader who had been Marchandeait (Case C-323/91, still pending). selling equipment without type-approval.
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legal relations 3, which has tended gradually 16 May 1988 on competition in the markets to eliminate national monopolies and privi- in telecommunications terminal equipment 5 leges and hence to secure acceptance of the (hereinafter 'the directive on terminal equip- right of traders to import and market freely ment'), and was finally upheld by the Court the equipment concerned. in the well-known judgment in Case 202/88 (France v Commission [1991] ECR I-1223).
At Community level, the principle of liberal- ization, already identified as the essential aim In itself, the assertion of the right to import of the Commission's Green Paper on tele- and market terminal equipment does not, communications 4 was later embodied in law, however, ensure that the markets are effec- as Commission Directive 88/301/EEC of tively integrated. Clearly, the importation and (still more) the marketing of terminal equipment continues to be subject, at least in part, to a complex system of national rules 3 — Specialized publications emphasize how technological deve lopment has played a crucial role in the evolution of econ- and inspections.
Although the enforcement omic and legal structures in the telecommunications sector in general and in the market for terminals in particular. The of such rules and inspections is to some speed of innovation, the merging of sectors wnich were pre- extent indispensable in the absence of a viously separate and characterized by diflering economic and legal structures (postal services and telecommunications, framework of Community or international information and audio-visual activities), the variety of means provisions, it may in some circumstances for transmitting information (which, of course, has its coun terparl in the range of terminals available) — in short, the have the effect of obstructing trade in a man- emergence of that broad and complex area of activity com monly known as 'information technology' — have pro- ner which is unjustified or at least dispropor- foundly changed the nature and characteristics of the goods tionate to the (legitimate) aims pursued. and services bought and sold, opening up new fields of action to vigorous international competition. Hence the need for proper guarantees, pre- As far as telecommunications terminal equipment is con cerned, there is no doubt that, even before Community pro- cisely with a view to preventing the freedom visions were adopted, the changes mentioned above had far- reaching repercussions on the structure and functioning of to import and sell terminal equipment from the European markets. The competition (mainly) from non- remaining a dead letter, having no practical member countries (the USA, Japan and the newly industri- alized countries) and the necci for industrial cooperation on effect. account of the scale of the investment required have gradu- ally reduced the divisions between the various national mar- kets of Europe, thereby weakening not only the exclusive rights enjoyed (de pure or de facto) by national (public) bod- ies with regard to the supply of terminal equipment but also the privileged links between such bodies and certain national producers (Alcatel, Siemens, Italici and so on). It is precisely the influence of those factors which explains Amongst those guarantees, the first and per- why the Member States were largely willing to accept the haps most important is the rule set out in the liberalization programme set out by the Commission in the Green Paper and later embodied in the directive on terminal Green Paper and laid down in Article 6 of
equipment. That directive was — as I had occasion to point out in my Opinion in Case 202/88 — challenged before the the directive on terminal equipment, requir- Court by certain Member States on formal grounds alone, ing the independence (or, as it is sometimes relating to the use of Article 9C(3) as its legal basis; its liber- alizing tendency, which had already received general assent, termed, the separation) of regulatory and went unchallenged. supervisory functions with regard to termi- With regard to developments in the telecommunications sec- tor and the market for terminal equipment, sec E. Stevers, nals (including the granting of type- 'Telecommunication Regulation in the European Commu- nity' (Working Paper N o 89/421), Istituto Universitario approval) from activities of an economic or Europeo, 1990, pp. 12 ff; AA. W , 'Vers une nouvelle régle- commercial nature; this fundamental guaran- mentation des télécommunications', Brussels 1990, pp. 1 ff and 175 ff; C. Overbury and P Ravaioli, 'The Application of tee may be supplemented by others, govern- EEC Law to Telecommunication', Annual Proceedings of ford/jam Corporate Lau Institute, 1989, pp. 271 ff. 4 — Commission communication. Green Paper on the develop ment of the common market for telecommunications services
and equipment, COM (87) 29C of 30 June 1987. 5 — OJ 1988 L 131, p. 73.
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ing the procedures for the adoption of The French rules on terminal equipment national technical specifications, and indeed capable of being connected to the State their content, or the proper conduct of telecommunications network inspections to ensure that the equipment complies with those specifications.
Pursuant to Article D440 et seq. of the French Code des Postes et Télécommunica- tions (Postal and Telecommunications Code) (hereinafter 'the PTT Code'), terminal equip- That being so, it may readily be seen that the ment (telephonic, telegraphic and radio- extent of the scope of those guarantees is the electrical equipment) may be supplied either central issue in the judicial proceedings aris- by the PTT or by private competitors. In the ing from the marketing of terminal equip- latter case the PTT does not intervene in ment without type-approval. On that issue dealings between user and supplier but there are two opposing interests: on the one requires type-approval for the equipment in hand, the interest of traders in being allowed question (Article D444 of the PTT Code, as to market terminal equipment as freely as amended by Article 3 of Decree No possible, and in any event without impedi- 85/336 of 12 March 1985). ments or restrictions lacking any objective justification, and, on the other, the public interest in ensuring that such marketing complies with the provisions and procedures which are the only means of upholding cer- tain essential requirements, the most impor- tant of which are the safety of users and In pursuance of that principle, and for the operators and the proper functioning of the purpose of regulating the marketing of ter- public telecommunications network. minal equipment intended for connection to the public telecommunications network, the French Government adopted Decree No 85-712 on 11 July 1985. Article 2 of Decree No 85-712 provides that terminal equipment may not be manufactured for the domestic market, imported, kept for sale, sold or dis- tributed (with or without a charge) unless it complies with the provisions laid down in The Court of Justice has already made an the decree. important contribution to resolving the issue in its judgment in RTT v GB-Inno-BM, mentioned above. The present case should serve to enlarge upon that earlier ruling, not only — I believe — on account of the special nature of the legal arguments adduced but also because, of the cases cited, Decoster is Under Articles 3 and 4 the equipment must the first to involve events which occurred meet a number of essential requirements for after the entry into force of the directive on the proper functioning of the network and terminal equipment. user safety.
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To that end, Article 6 of the decree provides — the Centre National d'Études des Télé- that manufacturers, importers, retailers and communications (CNET) is authorized distributors of the equipment must show that by the Minister for Industry to issue the the equipment complies with the essential 'report' under Article 6 mentioned above; requirements set out in Articles 3 and 4.
— type-approval (agrément) is to be issued by the Direction Générale des Télécom- munications, pursuant to the PTT Code, Article 6 further provides that the evidence in respect of equipment complying with may be supplied by the person concerned by the specifications set out in the list submitting any one of four documents, annexed to the Notice; namely a report drawn up by a body autho- rized by the Minister for Industry, a type- approval certificate (agrément) issued pursu- ant to the PTT Code, a certificate of — other documents attesting compliance, compliance issued under Law No 78-23 of referred to in Article 6, are to be estab- 10 January 1978 on consumer protection and lished later. information, or any other document accepted as equivalent by decree of the Min- ister for Industry. It should be noted that the judicial proceed- ings have not disclosed whether, following the Notice issued in November 1985, any evidential documents other than the type- In order to implement Decree No 85-712 the approval certificate and the CNET report Ministère du Redéploiement Industriel et du were drawn up. Commerce Extérieur issued a formai 'Notice' on 1 November 1985 regarding the terminal equipment liable to be connected to the State telecommunications network. The Notice first contains a list, updated to Proceedings before the national court 30 September 1985, of the technical stan- dards and specifications to be used for the purposes of Articles 3 and 4 of Decree No 85 712, and establishes that equipment com The facts of the case before the national plying with those standards or specifications court are extremely straightforward: between is regarded as being in conformity with those May and October 1989 Francine Gillon, née two articles. Dccoster, marketed telecommunications equipment (in particular telefax machines) without first obtaining either the type- approval certificate or any other document accepted as evidence of compliance with the The Notice further describes how interested essential requirements under Articles 2 and parties can show evidence, in accordance 3 of Decree No 85-712. Indeed, it is clear with the requirements of Article 6 of Decree from the order for reference that Mrs Gillon No 85-712, that the terminal equipment did not even apply for the documents in complies therewith. It establishes that: question.
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Mrs Gillon was accordingly prosecuted and specifications ..., monitoring their application ordered at first instance to pay a fine of FF and granting type-approval is entrusted to a 50 000. The first-instance court held that the body independent of public or private marketing of terminal equipment without undertakings offering goods and/or services the mandatory certificates under Decree No in the telecommunications sector.' 85-712 amounted to commercial deception {fraude commerciale) for the purposes of Article 1 of the Law of 1 August 1905.
Neither at first instance nor on appeal did The accused claims that at the material time the accused deny the facts as alleged. How- the French authority responsible for drawing ever, she disputes their relevance under crim- up technical specifications and monitoring inal law, claiming that the marketing of the compliance of equipment with the pre- equipment without type-approval or other scribed requirements was not independent of certificates of compliance does not constitute the body which managed the public telecom- an offence, because Decree No munications network and, simultaneously, 85-712 requiring the prior acquisition of marketed terminal equipment in competition such documents is inapplicable inasmuch as with other economic operators. It follows — it conflicts with certain provisions of the according to the accused — that application directive on terminal equipment and Council of Decree No 85-712 must be suspended on Directive 83/189/EEC of 28 March 1983 lay- the ground that it subjects traders to techni- ing down a procedure for the provision of cal specifications and monitoring procedures information in the field of technical stan- which are respectively laid down and con- dards and rules 6 (hereinafter 'the directive ducted by a body unable to provide the on technical standards'). essential guarantee of independence required by the Community directive.
There are two objections raised by Mrs Gillon which are recorded in the order for reference.
The second objection relates to the infringe- ment of the provisions of both the directive on technical standards and the directive on The first objection concerns an infringement terminal equipment requiring Member of Article 6 of the directive on terminal States, as a preliminary matter, to communi- equipment. Article 6 reads as follows: cate to the Commission in draft form the technical standards and specifications for cer- tain products, including in particular tele- communications terminals. The accused 'Member States shall ensure that, from 1 July claims that the technical specifications for 1989, responsibility for drawing up ... the equipment at issue were adopted without the prior communication laid down by the Community legislation: in the circumstances 6 — OJ 1983 L 109, p. 8. of this case, this calls for suspension of the
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application of Decree No 85-712, and hence The discussion which follows is principally authorizes her to market the equipment concerned with the question of the indepen- freely, that is, 'en dehors de toute procédure dence of the national regulatory and supervi- d'agrément OH d'homologation . sory body (heading A below). The other points put forward will, for reasons to be given later, be considered briefly (heading B below).
In view of the arguments relied upon by the accused, the appellate court considered it necessary to refer to the Court of Justice three questions on the matter, as to whether A — Independence of the body drawing up the abovementioned directives have direct the technical specifications, monitoring their effect and what the implications must be as application and granting type-approval regards the applicability of the contested national decree in this case. 7
(a) Legal basis for the requirement of inde- pendence It should, however, be noted that in the pro- cedure before the Court of Justice Mrs Gillon presented arguments on matters not included amongst those discussed in the order for reference. Besides repeating the As pointed out earlier, the rule under which points regarding lack of independence on the Member States must entrust responsibility part of the regulatory and supervisory body, for drawing up technical specifications, mon- and failure to communicate the relevant itoring their application and granting the rel- technical specifications (respectively Chapter evant type-approval, to a body independent II and Chapter I of her observations), she of public or private undertakings offering put forward three further arguments, as fol- goods or services in the telecommunications lows: the existence of discriminatory prac- sector — envisaged earlier in the Commis- tices by the French authorities to the detri- sion's Green Paper — was expressly set out ment of terminals imported from other in Article 6 of the directive on terminal Member States (Chapter III); practices by equipment. France Télécom involving abuse of a domi- nant position (Chapter IV); and the question whether national technical specifications which have not been harmonized under Community law arc applicable to terminals The preamble to the directive shows clearly which have already received type-approval in that Article 6 is an essential part of the gen- another Member State (Chapter V). eral plan to liberalize the market in telecom- munications terminals which underlies the directive. The guarantee of independence — that is, the impartiality of the regulatory, 7 It is wotrh emphasizing that in all the requests tor prelimi supervisory and licensing functions — is nary rulings from French courts arising from proceedings brought against persons charged with the marketing ol unap rightly presented as a key to ensuring that no proved terminals, the questions submitted to the Court arc conflict of interests arises in the market in the same as. or at least largely comparable to. the questions raised here question and hence that transparency and
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true competitive equality prevail. 8 The 90(3) of the Treaty to adopt measures of a leg- importance of that guarantee is consistently islative nature, specifying 'the obligations emphasized, moreover, in the commentaries arising from the Treaty'. 10 In the second on recent developments in European tele- place, the Court held that Article 6 of the communications law. 9 directive on terminal equipment does not conflict with the Treaty. On this point the Court gave judgment in general terms, with- out specifying the provisions of the Treaty against which the compatibility of Article 6 was assessed. In its reasoning the Court in fact reiterates the ideas (discussed above) set As noted above, the validity of Article out in the preamble to the directive: 6 (together with other provisions of the direc- tive on terminal equipment) was upheld by the Court in Case 202/88. That judgment pro- vides two points of relevance to the present case. In the first place, the Court held that the Commission is empowered under Article
8 — To that end paragraph 9 of the preamble to the directive states: 'a system of undistorted competition, as laid 'Stronger competition in the terminal equipment market requires the introduction of transparent technical specifica- down in the Treaty, can be guaranteed only if tions and type-approval procedures . . . To ensure that [these] arc applied transparently, objectively and without discrimi- nation, the drawing-up and application of such rules should be entrusted to bodies independent of competitors in the market in question.' 10 — In this connection it may be useful to point out that the Similarly, paragraph 17 states that: directives adopted by the Commission under Article 90(3) 'Monitoring of type-approval specifications and rules cannot are binding for the purposes of Article 189 of the Treaty be entrusted to a competitor in the terminal equipment mar- (see judgment in Case 226/87 Commission v Greece [1988] ket in view of the obvious conflict of interest. Member States ECR 3611), so that the obligations laid down in those should therefore ensure that the responsibility for drawing directives, even if limited to defining (or 'determining* or up type-approval specifications and rules is assigned to a 'expressing', to use other terms occurring in the judgment) body independent of the operator of the network and of any obligations already substantively embodied in the Treaty, other competitor in the market for terminals.' arc still to be regarded as formally autonomous.
Accord- 9 — See Stevers, op. cit., p. 17, where the measures needed 'to ingly, Member States arc bound to give effect to them ensure market participation in the competitive markets on unless they intend to challenge the legality of the directive fair terms' are described as including the 'separation of reg- by applying to the Court for its annulment (as has occurred ulatory and operational activities in order to prevent possible in respect of all directives adopted under Article 90(3) to abuse of dominant position in type approval', and also ibid, date). Moreover, should such an application to the Court be p. 39; see also H. lingerer, 'Comments on Telecommunica- out of time, it is at least doubtful whether the Member State tion Regulatory Reform in the European Community', pub- appearing as defendant in proceedings under Article 169 for
lished in AA. W . , Deregidation or Re-regulation}, London, failure to implement the directive is entitled to raise, as an 1990, p. 103; M. Coleman, 'European Competition Law in ancillary matter, the issue of its legality by reference to the the Telecommunications and Broadcasting Sectors', Euro- exception under Article 184 of the Treaty. pean Competition Law Review, 1990, p. 204; AA. W . , 'Vers It will be recalled that, in the case of a decision adopted by une Nouvelle Réglementation des Télécommunications', op. the Commission under Article 90(3), the Court held in cit., pp. 200 ff and pp. 224 ff; J. Schcrcr, 'European Telecom- Case 226/87 that the Member State to which the decision munication Law', published in AA. W , The Law of Infor- was addressed may not — having failed to challenge it in mation Technology in Europe, Deventer, 1991, p. 228; time — plead its illegality in proceedings brought by the C. Overbury, P. Ravaioli, op. cit, pp. 282 ff and 302 ff; Commission for failure to give effect to it. B. Amory, Vers une Nouvelle Réglementation Européenne However, the right of a Member State, in an action for failure des Télécommunications', Revue Française d'Administration to fulfil its obligations, to object that a regulation or (more Publique, 1989, p. 671; E. Bordón Iglesias, 'La Libertad de importantly) a directive is illegal (and Article 184 refers to Circulación de Mercancías y Política de la Competencia en el regulations alone), is a matter of dispute for which no firm Mercado de Terminales de Telecommunicaciones', Revista de guidance may be found in previous judgments.
An exhaustive Estudios y Investigación de las Comunidades Europeas, 1990, study both of the academic debate on the point and of the rel- pp. 559 ff; M. Hoskins, 'A Review of EEC Telecommunica- evant case-law of the Court is set out in the Opinion of tions Policy: Too Much of a Good Thing', European Busi- Advocate General Darmon in Case C-258/89, to which I ness Law Review, 1992, p. 8; P. Ravaioli, 'La Communauté would draw attention, whilst pointing out that the Court did Européenne et les Télécommunications: Développements not address itself explicidy to the question of principle raised Récents en Matière de Concurrence', Revue Internationale by the Advocate General (judgment in Case C-258/89 Com- de Droit Economique, 1991, p. 103. mission v Spain [1991] ECR I-3977).
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equality of opportunity is secured as management of the telecommunications net- between the various economic operators. To work then combines the business of market- entrust an undertaking which markets termi- ing terminals with the responsibilities of lay- nal equipment with the task of drawing up ing down the relevant technical the specifications for such equipment, moni- specifications, monitoring their application, toring their application and granting type- and granting type-approval for the equip- approval in respect thereof is tantamount to ment concerned. conferring upon it the power to determine at will which terminal equipment may be con- nected to the public network, and thereby placing that undertaking at an obvious According to the Court, in order to maintain advantage over its competitors.' effective competition and guarantee transpar- ency, it is necessary 'to entrust responsibility for drawing up technical specifications, mon- itoring their application and granting type- Thus the Court seems to follow the Com- approval to a body independent of public or mission's approach, whereby fair conditions private undertakings offering competing of competition may be said to exist only in goods and/or services in the telecommunica- so far as the system set up by the Member tions sector.' States guarantees independence and impar- tiality of legislation and supervision, which presupposes the separation of those func- tions from activities of an economic or com- The judgment therefore makes it clear that mercial nature. the legal basis for the obligation to guarantee the independence of regulatory and supervi- sory functions in respect of telecommunica- tions terminals is to be found, in some cir- That approach was later confirmed by the cumstances at least, in Article 86 of the recent ruling in RTT v GB-Inno-BM. The Treaty, read in conjunction with Articles 3(f) judgment — which relates to facts predating and 90 thereof. As regards the circumstances the entry into force of the directive on termi- which must be present before the abovemen- nal equipment — establishes primarily, in tioned provisions may be applied in combi- general terms, that Articles 3(f), 90 and 86 of nation, these may be summarized as follows: the Treaty arc automatically infringed when- ever a body with a (statutory) monopoly over the management of the telecommunica- — the body in question holds a dominant tions network derives from State provisions position in the market in telecommunica- the opportunity to distort competition in the tion services; related, but separate, market in terminal equipment.
— it distorts competition in the neighbour- ing market in terminal equipment; As is evident from the reasons given by the Court for its decision, such a distortion of competition may be said to arise whenever — it docs so by virtue of a national measure the body enjoying a monopoly in the which enables it to alter unilaterally the
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conditions under which terminal equip- the one hand, and of legislation and supervi- ment is marketed. sion, on the other, will, if it interferes with equal opportunities as between competitors, automatically result in discrimination — at least potential discrimination — against imported products, irrespective of whether the body in question is present and holds a Furthermore — even though in RTT v monopoly or at least a dominant position in GB-Inno-BM the Court gives no express the separate market in telecommunication ruling on the point — the basis for the services. requirement of independence in question may be found not only in Articles 3(f), 86 and 90 of the Treaty but also in Article 30 thereof. According to the case-law of the Court, a national provision whose effect is to facilitate an abuse of a dominant position lia- ble to impair intra-Community trade is usu- It is precisely that broader view which is ally incompatible with the prohibition under reflected by Article 6 of the directive on ter- Article 30 of measures having equivalent minal equipment. Article 6 demands, with- effect (judgments in Case C-179/90 Merci out qualification, the separation of marketing Convenzionali Porto di Genova v Siderur- activities from regulatory and monitoring gica Gabrielli [1991] ECR I-5889 and Case activities, and it shows clearly that this sepa- 13/77 Inno v ATAB [1977] ECR 2115). ration is required even where the body mar- Moreover, in the RTT ruling the Court made keting terminal equipment does not at the a point of observing that the national mea- same time operate in the market for telecom- sures in dispute were likely to impede munication services. 12 imports of equipment from other Member States and thereby adversely affect trade between Member States 11 for the purposes of Article 86.
In the light of those considerations, there- fore, I take the view that the specific obliga- That is not all, however. There may be tion set out in Article 6 of the directive on adverse effects on trade even if there is no terminal equipment, although broader in dominant position of the kind described in scope than the obligation laid down by the RTT. The merging, or combining, within a Court in RTT v GB-Inno-BM, does not rep- single body of the functions of marketing, on resent an innovation in relation to the Treaty, in that its legal effects on Member States are not substantially different from those already arising from Article 30 and the combined 11 — The judgment refers to the impairment of competition between Member States (paragraph 27). However, not only provisions of Articles 3(f), 86 and 90 of the the reasoning as a whole, which emphasizes the impact of Treaty. national legislation on imports, but also the general struc- ture of the ruling, which seeks in the passage in question to show that one of the conditions for the application of Arti- cle 86, namely an adverse effect on intra-Community trade, has been fulfilled demonstrates that the Court in fact stressed the distortion, not so much of competition as of 12 — This accords with the view of P. Ravaioli; op. cit., p. 120, trade between Member States. note 29.
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(b) Direct effect of Article 6 of the directive on a body, whether public or private, in on terminal equipment competition with them.
(c) The Community system in force prior to the commencement date set by Article 6 of the directive on terminal equipment
Since it has been established that Article That being so, the reply to the questions of 6 has direct effect, it is necessary briefly to interpretation raised in this case seems rela- deal with a second issue. It seems desirable tively simple. To begin with, as far as Article to outline the law as it stood prior to the 6 of the directive on terminal equipment (the commencement date (1 July 1989) after subject of the second question from the which, pursuant to Article 6, Member States national court) is concerned, I believe that its come under the obligation to ensure the direct effect should be recognized without independence of bodies responsible for any hesitation. As was observed above, Arti- drawing up specifications, monitoring their cle 6 in fact merely defines obligations which application and granting type-approval. the Treaty itself lays down and imposes on Admittedly, the latter point was not specifi- Member States. It would thus be illogical to cally referred to by the national court; how- maintain that the specific provision adopted ever, it is undoubtedly relevant to the settle- by the Commission pursuant to Article 90(3) ment of the dispute, inasmuch as the material does not have direct effect when the general events (that is, the marketing by Mrs Gillon provisions of the Treaty to which it gives of terminal equipment without type- effect do. Moreover, whilst it is true that approval) occurred between May and Octo- Article 6, in obliging Member States to ber 1989, and hence during a period which entrust regulatory and supervisory functions straddles the date laid down by Article 6. to an independent body, allows them a mar- gin of discretion as to the system to be cre- ated to that end, it is equally true that, if viewed in the light of the preamble to the In the light of the earlier observations, more- directive, that provision lays down a clear, over, the answer presents no difficulties. It is precise and unconditional prohibition of the sufficient to note that, even prior to the date retention of any system whatsoever which under Article 6, and indeed before the adop- allows any single entity to combine those tion of the directive on terminal equipment functions with the supply of goods and/or itself, the requirement of independence services in the telecommunications sector. existed and was binding on Member States, Furthermore, since that prohibition is by virtue of the Treaty provisions on the designed to ensure that equal conditions of movement of goods and on competition. The competition prevail in the relevant market, it RTT judgment which was seen earlier to is also clear that the provision is intended to refer to an episode comparable to the events protect the legitimate interests of undertak- in the present case but occurring before the ings operating in that market, which may, by adoption of the directive on terminal equip- virtue of Article 6 and the aforesaid Treaty ment, shows that legislation which docs not provisions, require Member States not to ensure independent regulating and monitor confer regulatory or supervisory functions ing of terminal equipment and thereby gives
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rise to conflicts of interest is, at least in some (d) The contested national legislation circumstances, automatically incompatible with Articles 3(f), 86 and 90 of the Treaty. Furthermore, for the reasons given above, it is correct to say that even where the precon- Turning now to the disputed provisions, I ditions for the application of Article 86 (in must make the preliminary remark that, in conjunction with Article 90) are not satisfied, France as in other Member States, there have that type of legislation creates in any event a been attempts in recent years to introduce a potential obstacle to trade within the Com- gradual deregulation of the telecommunica- munity and thus falls within the scope of the tions sector. The relevant measures adopted prohibition under Article 30 of the Treaty. by the French authorities enable, roughly speaking, three separate stages to be distin- guished:
— the first falls within the period preceding the adoption of Decree No 89-327 of 19 May 1987;
It follows that even before the directive on — the second falls within the period terminal equipment was adopted, Member between Decree No 89-327 and Law N o States were bound under the Treaty to 90-568 of 2 July 1990; ensure that the drawing-up of technical spec- ifications, the monitoring of their application and the granting of type-approval for the — the third belongs to the period following equipment was performed by a body inde- Law No 90-568. pendent of the undertakings offering goods or services in the telecommunications sec- tor. 13 Of those three stages, only the second and, conceivably, the first are relevant for present 13 — It must be said that, in the light of that conclusion, the very purposes. The third stage, on the other hand, introduction of a commencement date under Article 6 of the directive seems superfluous. That is probably due to the belongs to a period (Law No 90-586 having fact that, at the time when the directive was adopted, RTTv entered into force on 1 January 1991) which GB-Inno-BM had not yet been decided. Accordingly, the Commission was entitled to the view that the obligation to clearly post-dates the events material to this ensure independent rules and inspections could not be inferred from the Treaty but was, at least in part, created by case. the directive. Hence, in so far as the Commission may have believed that, in view of the substantive obligations laid down by the directive (that is to say, those under Articles 2, 3, 6 and 7), the directive itself was instituting new obliga- tions rather than merely setting out obligations already contained in the Treaty, it may have considered it advisable to make the effects of one of the provisions of the directive That being so, it is tolerably clear from the subject to a commencement date, clearly intended to allow States a period of grace for enacting the legislative amend- evidence produced before the Court that, ments required. either in the first or in the second stage, the On the other hand, it must be emphasized that the com- mencement date relates only to Article 6 of the directive, national system in question did not afford and docs not in any way seek to — nor indeed could it sufficient guarantees of independence, inas- — limit the effects of the obligations directly imposed by the Treaty. much as all the activities in question — that
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is to say, the drawing-up of technical specifi- — terminals other than those supplied by cations, the monitoring of their application, the administration were subject to type- the granting of type-approval for terminal approval (Article D44C et seq. of the PTT equipment and the marketing of that equip- Code); ment — were performed by administrative organs all of which formed part of the cen- tral administration of posts and telecommu- nications which, moreover, was also respon- sible for the monopolistic management of — according to the Ministerial Notice of the public telecommunications network. 1 November 1985, cited above, type- approval for terminal equipment was the responsibility of the Direction Générale des Télécommunications;
In particular, the situation prior to Decree No 89-327 was as follows: — although the French Government has not clearly defined the formal status of France Télécom at the time, it was clearly part of — under Decree No 86-129 of 28 January the central administration of the PTT and 1986 (Article 2), the drawing-up of regu- responsible at managerial level for con- lations on telecommunications and the ducting trade in the telecommunications monitoring of compliance with their gen- sector; 14 eral principles were entrusted to the Délégation Générale à la Stratégie, directly under the aegis of the Minister for Posts and Telecommunications (PTT); — as regards the report issued by the CNET and considered equivalent to type- approval for the purposes of the ministe- — the Délégation Générale à la Stratégie rial notice, it is clear that the CNET operated in concert with the other direc- forms part of France Télécom as a 'centre torates general of that ministry, including dc recherche de l'exploitant public' (reply in particular the Direction Générale des of the French Government to a question Télécommunications (Article 2 of Decree from the Court) — which evidently rules No 86-129); out any guarantee of independence in the issuing of the certificate of compliance.
14 — The assertions of the Commission and Mrs Gillon, which — the Direction Générale des Télécommuni- incidentally were in no way contradicted by the French cations embraced the Direction des Government, to the effect that iranci; Télécom was simply the 'shop front' for the F I T administration, are borne out Affaires Commerciales et Télématiques, in specialized publications Sec in particular AA. VV. 'Vers une Nouvelle Réglementation des Télécommunications', op whose task was to propose and imple- cit., p 93, which explains that France Telecom is the trade ment policy on trade and telematics name of the Direction genérale des télecommunications, sec also J. Chevallier, 'La Mutation des Postes et Télécommum (Article 14 of Decree No 86 129); calions', AJDA, 1990, p. 667.
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The situation does not seem to have been — it reveals further evidence of the close substantially changed by the entry into force functional relationship between the of Decree No 89-327. On the contrary, by Direction générale des télécommunica- altering the internal structure of the PTT tions — and hence France Télécom — and administration and by defining the powers of the directorate responsible for laying the various departments, Decree N o down rules in that sector (the Direction 89-327 reveals even more clearly the fusion de la réglementation générale); one of the of purely business activities and those relat- departments of the Direction générale des ing to the drawing-up of technical specifica- télécommunications (the Direction des tions, monitoring and type-approval. Thus: affaires industrielles) puts forward the technical specifications for terminal equipment (Article 4 of Decree N o 89-327). 15
— it sets up a Direction de la réglementation générale — in place of the Delegation In brief, those points disclose that at the générale à L· strategie — which defines material time neither the adoption of rules and enacts the general legal framework nor the granting of type-approval for termi- for the activities of the sector in question; nal equipment (nor more generally the mon- in particular, the directorate is responsible itoring of compliance 16 were carried out by for: a body independent of the entity marketing the terminal equipment itself. On the con- trary, all those activities were conducted by a single entity (namely the central administra- tion of the PTT). Of course, those tasks — monitoring compliance with the regula- could have been distributed between various tions in force; general directorates or other departments of that administration. Nevertheless, the tasks could be traced back to a single State admin- istration and were, in hierarchical terms, sub- — preparing draft laws and regulations and ject to a single decision-making authority. drawing up directives governing the activities of the various economic opera- tors in the sector; 15 — The French Government has not explained whether under Decree N o 89-312 type-approval was invariably issued by the Direction générale des télécommunications or by some other directorate within the Ministry for Posts and Tele- communications. The decree itself is silent on this point. In any case, even if responsibility for type-approval had been transferred to another directorate, this would not substan- tially change matters. — establishing and publishing technical 16 — Indeed, it is not clear from the documents before the Court specifications and type-approval proce- whether, subsequent to the abovementioned Ministerial Notice of November 1985, certificates of compliance were dures for terminal equipment (Article introduced which were distinct from type-approval certifi- 2 of Decree No 89-327); cates and the C N E T report. However, that is irrelevant. Even on the supposition that certificates of compliance were issued by a body totally unconnected with the PTT administration, and hence that there was at least a possibil- ity of having equipment checked for compliance pursuant to Decree N o 85-712 by an independent and impartial body, the fact remains that the technical specifications serv- ing as parameters for the inspection would nevertheless have been laid down by the PTT administration, and hence — it does not alter the commercial functions by an entity which — as wc have seen — was not indepen- performed by the PTT administration; dent.
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Moreover, the prevailing system entailed a this case that prior to Law No 90-586 the relationship — whether hierarchical or func- PTT administration was responsible not only tional — between the various directorates (as for the marketing of terminal equipment but is indeed obvious, the departments in ques- also monopolized the management of the tion being part of one and the same minis- public telecommunications network. The try). Lastly, even within the Direction national measures in question therefore générale des télécommunications itself, com- allow monopoly powers to be extended from mercial responsibilities were interwoven the market in telecommunications services to with vested powers as regards the drawing the related, but separate, market in terminal up of specifications and the granting of type- equipment; this situation must, in accordance approval. with the judgment in R TT v GB-Inno-BM, be considered to conflict with the combined provisions of Articles 3(f), 86 and 90 of the Treaty. Only later, under Law No 90-568, was a sep- aration achieved, at organizational level at least, between business activities and the other activities (drawing up and monitoring regulations and granting type-approval). The It would have been possible to reach a differ- law divorced both the management of the ent conclusion only if there had been evi- public telecommunications network and dence that, at the material time, any trader business activities from the central adminis- had, in practice, had an opportunity to have tration of the PTT. Those functions are still specific terminal equipment tested for com- performed by France Télécom but the latter pliance with the essential requirements of no longer forms part of the Ministry for safety and the proper functioning of the net- Posts and Telecommunications, operating work: instead as a body incorporated under public law and endowed with its own legal person- ality. At the same time as the constitution of France Télécom was amended, the Direction — by a body independent of the PTT générale des télécommunications within the administration; and PTT administration was abolished.
— by reference to technical parameters laid down by a body independent of the PTT In the light of the foregoing considerations I administration. believe that the conclusion must be that, at least until Law No 90-568 entered into force, the drawing-up and monitoring of regula- tions and the granting of type-approval were emphatically not performed by a body inde- Subject to the findings and appraisals which pendent of the traders who marketed termi- are the exclusive preserve of the national nal equipment, and that this points to an court, I can do no more than reiterate that infringement both of Article 6 of the direc- according to the documents before the Court tive on terminal equipment and, for the rea- the situation prevailing in France at the sons stated above, of Article 30 of the Treaty. material time did not lend itself to that Furthermore, it may safely be assumed in hypothesis in any way.
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(e) Inapplicability of Decree No 85-712 (with the result that no criminal liability arises on the part of traders who, like Mrs Gillon, have sold terminal equipment with- out type-approval during a period in which the impartiality of the legislation and of the A further point is that failure to observe the inspections was not assured). abovementioned Community provisions should have the result of making the con- tested national decree, that is Decree No 85-712, inapplicable. As we have seen, the decree requires traders to seek type-approval for the equipment (or at least to obtain cer- tification showing its compliance with cer- tain standards). However, in so far as the This means, however, that terminal equip- body laying down technical standards (on ment may legitimately be offered for sale the basis of which type-approval is issued) without prior inspection (even by means of a and granting type-approval (or carrying out procedure providing no guarantees of impar- equivalent inspections) is simultaneously one tiality) to establish its compliance with of the traders concerned (or is closely relat- requirements such as user safety or proper ed), there is clearly no possibility of the functioning of the network. inspection procedures affording other com- petitors proper guarantees of impartiality.
Lack of independence therefore constitutes a defect which not only vitiates a particular Thus the safeguarding of those requirements decision on a given request for type-approval comes, in effect, to be subordinated to the but which goes to the very heart of the entire protection of competition: an unsatisfactory system of rules and inspections introduced result, both in general terms (since in the by a Member State with regard to the mar- Treaty non-economic imperatives of that keting of terminal equipment. It follows that kind take precedence over the protection of in this case the procedures laid down by competition and trade) and in the light of the Decree No 85-712 for the granting of type- specific provisions of the directive on termi- approval for terminal equipment do not fulfil nal equipment, which preserves the right of the essential conditions under Community Member States to refuse to allow such equip- law and must accordingly be regarded as ment to be connected when it does not meet inapplicable. essential requirements such as those specified above (Article 3 of the directive, referring to the requirements laid down in Article 2(17) of Directive 86/361/EEC). If, where the granting of type-approval is not impartial, I am, of course, perfectly aware of the impli- traders cannot be obliged to seek it, it fol- cations of that conclusion. Expressed simply, lows that the national authority, rather than it means that Member States are not entitled refusing to allow equipment to be connected, to apply type-approval (or similar) proce- will only be able to intervene ex post facto to dures unless their impartiality is guaranteed have it disconnected and, if need be, to react
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to such disruption or damage as is found to According to the report for the hearing in have occurred. 17 that case, the national court considered, in the light of those arguments, 'that it was nec- essary to ascertain whether a procedure for approval such as that imposed by the RTT was lawful because otherwise it would be unlawful to require a trader selling tele- Moreover, even though it may give rise to phones to tell his customers that it was nec- some misgivings, the matter must now in my essary to submit them for approval.' 18 opinion be regarded as settled, following the judgment in RTT v GB-Inno-BM. That rul- ing was given on a preliminary reference arising out of an action brought by a public As has been stated more than once, the judg- body (RTT) for an injunction against a pri- ment of the Court shows that the rules of vate competitor (the trading group competition in the Treaty may be invoked by GB-Inno-BM). The object of the injunction a trader opposing the application of a sought was to require GBTnno-BM to desist national system which empowers another from its practice of selling terminal equip- competitor to lay down the technical stan- ment which had not received type-approval dards for the products at issue and to moni- without informing the purchaser of that fact. tor their application.
Hence there is every reason to believe that, as a result of the Court's decision, the The defendant had pleaded inter alia the national court considered that there were no incompatibility with Community law of the legal grounds for the injunction sought by national provisions (Articles 3 and 91 of the the RTT, and accordingly permitted the Belgian Decree of 20 September 1978) which defendant to market equipment without made the connection of terminal equipment type-approval, and indeed to do so without subject to authorization by the RTT and informing the purchaser that such approval required prior type-approval for terminal had not been granted. equipment supplied by operators other than RTT. GB-Inno-BM contended that these obligations to seek authorization and type- approval were illegal inasmuch as RTT Consequently, unless the Court sees fit to thereby assumed, simultaneously, the role of revise that precedent, I believe that the regulatory and supervisory body and that of national court's question should be answered interested party, with the result that even the as follows: Articles 30, 3(f), 86 and 90 of the obligation to inform the purchaser of the EEC Treaty, together with Article 6 of the absence of type-approval had to be regarded directive on terminal equipment, preclude as illegal. the application of national provisions such as those laid down in French Decree No
17 - P. Ravaioli, op. cit.. p 113. note 18, observes significantly that since the connection of equipment, pursuant to the 18 — The Court had also noted that 'the existing situation, in directive on termina! equipment, ts no longer governed by which the R I T alone determines the conditions governing exclusive rights or subject to prior authorization, the retusai approval and also decides on the grant of approvalwas very under Article 3 to allow such connection will be permissi debatable when the RTT was also a competitor on the mar ble only in the context of the tvpc approval procedure. kct in equipment for connection to the network.'
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OPINION OF MR TESAURO — CASE C-69/91
85-712, which require traders seeking to As we know, the questions raised relate to market terminal equipment to demonstrate the following matters: — by means of type-approval or an equiva- lent procedure — that the equipment com- plies with certain requirements (relating in — the technical specifications on the basis of particular to user safety and proper function- which the French authorities should have ing of the network) where there is at the granted type-approval for the equipment same time no guarantee of the independence, in question were allegedly adopted with- in relation to any trader offering goods or out regard to the procedural require- services in the telecommunications sector, of ments under the directive on technical the body which: standards and the directive on terminal equipment, which — in the contention of Mrs Gillon and the Commission — means that those specifications are inap- plicable; — issues the type-approval certificate (or an equivalent document); — terminal equipment already granted type- approval in another Member State should — according to Mrs Gillon — be sub- — draws up the technical specifications used jected to 'simplified' inspections in the for the purpose of issuing the type- Member State of importation, which approval certificate (or an equivalent doc- means in practice that national technical ument). specifications which are not indispensable for safeguarding certain essential require- ments are inapplicable to such equip- ment;
B — Other questions raised in this case — the existence of discriminatory practices on the part of the French authorities in granting of type-approval for terminal equipment;
— the existence of abuses by France Télécom In view of the answer given to the question of its dominant position. as to the independence of the body laying down the rules and granting type-approval in the market for terminal equipment, no purpose would be served by considering the Those matters call for a general remark: the other questions raised in this case. It is only criticisms set out above — unlike the objec- for the sake of completeness and, of course, tion that the regulatory and supervisory for the eventuality that the Court may body is not independent — do not cast decide not to follow the solution advocated doubt on the entire system established by above that I now propose to examine briefly Decree No 85-712 for the granting of type- the remaining points which have emerged approval for terminal equipment. What infer- during the proceedings. ence would have to be drawn if those
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DECOSTER
criticisms were found to be valid? The reply On the other hand, the mere possibility that to that question is, in my opinion, very sim- refusal to grant type-approval might prove ple. It is clear that the application of techni- to be illegal could not in any way serve to cal specifications which, on substantive or exempt Mrs Gillon from seeking it and could procedural grounds, are illegal invalidates an not therefore positively authorize her to individual decision (whether favourable or market terminal equipment 'en dehors de unfavourable) given by the national auth- toute procédure d'agrément ou homologa- ority. The result is the same when the tion'. decision regarding type-approval involves discrimination against the imported product. Finally, it is self-evident that any infringe- ment of Article 86 of the Treaty by a public undertaking renders illegal the abusive con- duct in question.
I therefore consider that, in this regard, the On closer inspection, therefore, the defects answer to be given to the national court can complained of may affect the outcome of the be formulated as follows: neither the alleged type-approval procedure but not the actual incompatibility with Community law, on principle of type-approval established by the grounds of form or substance, of national contested decree. technical specifications for terminal equip- ment, nor the alleged implementation by the national authorities of discriminatory prac- tices in the granting of type-approval for It follows that, had Mrs Gillon been such equipment nor the alleged adoption by adversely affected by refusal to grant type- France Telecom of conduct constituting an approval, or by any other act incompatible abuse of a dominant position within the with Community law, she could have meaning of Article 86 of the Treaty can serve responded by asserting its illegality under to exempt those marketing such equipment the procedures provided for that contin- from the need to seek type-approval (or an gency. She would, however, have had to seek equivalent document) in accordance with type-approval, and this she has not done. French Decree No 85-712.
Conclusion
In the light of those considerations, I consider that the following answer should be given to the national court:
Articles 30, 3(0, 86 and 90 of the E E C Treaty, together with Article 6 of C o m m i s - sion Directive 8 8 / 3 0 1 / E E C of 16 May 1988 on terminal equipment, preclude the
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OPINION OF MR TESAURO — CASE C-69/91
application of national provisions such as those contained in French Decree N o 85-712, which require traders seeking to market terminal equipment to demonstrate — by means of type-approval or an equivalent procedure — that the equipment complies with certain requirements (relating in particular to user safety and proper functioning of the network) where there is at the same time no guarantee of the independence, in relation to any trader offering goods or services in the telecommu- nications sector, of the body which:
— issues the type-approval certificate (or an equivalent document);
— draws up the technical specifications used for the purpose of issuing the type- approval certificate (or an equivalent document).
Should the Court find it necessary to consider the other points raised in these pro- ceedings, I propose that the following answer be given to the national court:
Neither the alleged incompatibility with Community law, on grounds of form or substance, of national technical specifications for terminal equipment, nor the alleged implementation by the national authorities of discriminatory practices in the granting of type-approval for such equipment nor the alleged implementation by France Télécom of conduct constituting an abuse of a dominant position within the meaning of Article 86 of the Treaty can serve to exempt those marketing such equipment from the need to seek type-approval (or an equivalent document) in accordance with French Decree N o 85-712.
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