Germany’s ruling parties compromised Mon. on the proposed terms f...

Democrats and Social Democrats in Parliament’s economic affairs committee agreed to insert a revised definition of “new market” into amendments of the country’s Telecom Act. The new language defines a new market as one “for services and products that distinguishes itself” from other products and services with regard to performance capacity, reach, availability for mass market capability, price or quality from the viewpoint of an average user, and doesn’t simply substitute for them, Spies said. The pact also tweaks controversial Sec. 9a to say that, as a rule, new markets shouldn’t be regulated. But determining whether a service or product is new must be done by German telecom regulator BNetzA in light of goals to promote efficient infrastructures and support innovation. The good news, Spies said, is that BNetzA now seems to have discretion in determining whether a new market exists and won’t be held to a strict deadline for making the ruling. But the regulator’s decision will be predetermined by the provisions and “DT is the clear beneficiary,” he said. Moreover, he said, the market definition doesn’t focus on user demand, the standard approach for market determination, but on the provider: Meeting one of the criteria may be enough to allow the regulator to ignore other criteria and decide a new market exists. The EC “is bypassed in this process and will almost certainly challenge the new law if adopted,” Spies said. The plan is to win parliamentary approval for the compromise this year, he said. The German govt. holds a 30% direct and indirect stake in DT.