The European Antitrust Review 2014 Section 3: Country chapters

Italy: Telecoms

New implementing legislation

On 28 May 2012, the Italian government issued Legislative Decrees Nos. 69 and 70 (published in the Official Journal No. 126 of 31 May 2012) transposing EU directives included within the Telecoms Package.

Legislative Decree No. 69/2012, which implements Directive 2009/136/EC, relates to the processing of personal data and the protection of privacy in electronic communications. Among the most important aspects of the new decree is the provision that the user must consent to the storing or accessing of cookies in the user’s terminal. A data breach notification system is introduced for providers of an electronic communication service, who in certain circumstances must notify customers when there is a breach of their personal information.

Legislative Decree No. 70/2012, implementing Directive 2009/140/EC on access to, and interconnection of, electronic communications networks, introduces the concept of technological neutrality, focuses on competition, seeks to guarantee non-discrimination between companies, and aims at greater cooperation between the Italian authorities and the Body of European Regulators for Electronic Communications1 (BEREC).

The substantive focus of the new legislation is on greater contractual safeguards and data protection for users. Legislative Decree No. 69/2012 is focused predominantly on prior consent to the processing of user data and on data security. It introduces a requirement to adopt technical measures to protect personal data as well as data related to traffic and the location of users. It classifies as a data breach the destruction, alteration and accidental loss of data, as well as unauthorised access or wrongful disclosure of stored, processed or transmitted data.

In case of a data breach, the provider of electronic communications services must notify the national regulatory authority for communications (AGCOM). In severe cases the provider must also notify the data subject or may be required by AGCOM to do so if it has not already done so. Notification to the authority should include proposed solutions to remedy the breach. AGCOM may issue instructions and guidance as to how providers should notify the data subject.

In contrast, the amendments to the Code of Electronic Communications included in Legislative Decree No. 70/2012 cover numerous issues including, most significantly, provisions on the management of radio frequencies for electronic communications services; numbering; addressing and assigning domain names; and network security and services.

Legislative Decree No. 70/2012 also requires greater transparency in contracts, especially with regard to pricing, quality, timing and conditions of service. It focuses on obtaining better comparability between operators and their offerings on the market and making it easier for individual users to change suppliers.

Delay in implementation

Italy’s failure – along with 19 other member states – to implement the Telecoms Package by 25 May 2011 led to the European Commission opening infringement proceedings. The new decrees have now, however, fully implemented the rules and principles contained in the Directives 2009/136 and 2009/140, such as, for example, the right for consumers to switch fixed or mobile operator within one working day without having to change phone number and the right to clear information about the minimum levels of service quality.

Under the decrees, provision is made for broadband users to receive information about traffic management techniques and their impact on the quality of service, as well as any other limitations (such as the limits of bandwidth, the speed of connection, blocking or throttling of access to certain services like VoIP). Further, consumers and other end users’ contracts must contain detailed information on refunds and compensation offered where contracted service quality levels are not met.

The commencement of infringement proceedings, and repeated calls from the European Institutions and Neelie Kroes, the EU digital agenda commissioner, for member states to adopt the Telecoms Package fully, did little to accelerate implementation. The late implementation of the directives in Italy (as in other member states) was undoubtedly to the detriment of consumers, who for a full year were without the greater protection against, and information about, breaches of their personal data that the directives afford. Now at least, following transposition, it has become possible to test the potential of the new regulations to improve the telecommunications market, especially its competitiveness .

Legislative Decree No. 70/2012: amendments to the Italian Code of Electronic Communications

Legislative Decree No. 70/2012 amends Legislative Decree No. 259/2003, the Italian Code of Electronic Communications. The Decree makes various significant amendments regarding networks, radio frequencies, the lists of subscribers, among other things. It also mirrors the European legislation on access to electronic communications networks and associated facilities (title II, chapter III of the Code), and authorisation of electronic communications networks and services.

One of the legislation’s main aims is to improve competition within the wholesale communications markets. It strengthens protections for access to the market, emphasising the criteria of objectivity, transparency, non-discrimination and proportionality.

The new rules also provide for a strengthened system of notification of suppliers’ economic and financial information to the Ministry of Communications and AGCOM to improve monitoring of competition. With this aim AGCOM has also put in place a procedure to evaluate the Integrated Communications System.

Providers of electronic communications networks and services shall transmit all information, including financial information, necessary to the Italian Ministry of Communications and AGCOM to ensure compliance with their provisions or decisions. More precisely, the Ministry and AGCOM may require those undertakings to submit information concerning future developments planned at network or service level that may have an impact on the wholesale services they make available to competitors.

Undertakings with significant market power on wholesale markets may also be required to submit accounting data on connected retail markets (as is already the case for some markets with the Economic Information System, under which AGCOM requests annual economic data from operators with SMP).

Undertakings providing electronic communications networks and services must promptly submit all information, in accordance with the terms and degree of detail determined by the Ministry of Communications or AGCOM.

Significantly, article 13 of the amended Code provides that all regulation relating to technology that would boost competition in the market must take into account the principle of technological neutrality and not unduly favour or discriminate against a particular technology.

Legislative Decree No. 70/2012 contains provisions on consultation procedures about measures AGCOM may introduce to solve market problems that could impinge on the single market. Article 12, paragraph 2 of the amended code mandates AGCOM to cooperate with BEREC and the European Commission in such matters.

The amendments also focus on security and integrity of electronic communications networks accessible to the public. The Ministry must identify appropriate technical and organisational measures to ensure the security of networks and electronic communications services accessible to the public, and to ensure the integrity of the networks.

The new legislation’s focus on human rights is noteworthy. Any decision regarding access to or use of services and applications through electronic communications networks by end-users liable to restrict those fundamental rights or freedoms may only be imposed if appropriate, proportionate and necessary within a democratic society. Further, implementation should be subject to adequate procedural safeguards in conformity with the European Convention for the Protection of Human Rights and Fundamental Freedoms and with general principles of European Union law, including the principles of adequate and effective judicial protection and due process.

Several measures are also aimed at preventing and limiting the consequences of security incidents for users and interconnected networks. The Ministry is empowered to identify cases where breaches of security or loss of data integrity could be considered ‘significant and relevant’ for the proper operation of networks or services. This may have a significant influence on the determination of whether incidents trigger the duty to notify users of a data breach.

With respect to the authorisation regime for general networks and electronic communications services, it is contemplated that companies providing cross-border electronic communications relating to undertakings located in several states need only notify in one member state, which greatly streamlines the procedure (title II, chapter II of the new Code).

Finally, changes to the contractual regulations have been introduced (article 70 and following of the new Code), increasing transparency of contracts for the provision of electronic communications services, with regard to price, quality, timing and conditions of the offer. The amended legislation also prescribes in greater detail the contents of contracts, specifically with reference to the procedure for terminating contracts.

Articles 57 and 73-bis are dedicated explicitly to persons with disabilities, in order to guarantee their rights, ensuring equal access to public voice telephony.

Conclusion

The transposition of the EU standard is designed to promote efficient investment and innovation in the electronic communications infrastructure, such as introducing the possibility for the NRA to impose the sharing of infrastructure, including buildings and access to them, wiring, as well as non-active network elements. The introduction of the principle of technological neutrality brings with it the promotion of efficient, flexible and coordinated spectrum management, mainly through the introduction of more innovative services. The new provisions on contracts reinforce users’ rights relating to transparency in dealings with service providers to reduce disputes between operators and users.

The new legislation should lead the market for electronic communications towards a strengthened competitive structure, and should strengthen the internal market of the European Union, through greater protection and attention to consumers and other users. To pay no attention to the principles underlying the legislation transposing the two EU Directives, however, would not satisfy the purpose of the new regulations, and would render implementation of the European legislation a mere box-ticking exercise; whereas the new regulations should only form the foundations for the construction of a series of pro-consumer initiatives for the market in general.

Notes

  1. BEREC, the Body of European Regulators for Electronic Communications, was founded in 2010 to coordinate national regulatory authorities’ measures on complex issues and to supervise the level of competition in the market. Under the procedure established under article 7 of Directive 2002/21/EC as amended by article 2009/140/EC, (the Framework Directive) the Commission and BEREC must act to promote the single market in electronic communications. According to this procedure, telecommunications NRAs must submit their market analyses to the Commission before adopting the final decisions Specifically, if the Commission considers that a measure relating to competition notified in the drafting phase by a NRA is likely to create barriers to the single market for telecommunications services, the Commission can carry out a thorough evaluation and, in cooperation with BEREC, may issue a binding recommendation to the NRA to amend or withdraw its planned measure.

Studio Legale Monaco & Associati

Corso Vittorio Emanuele II, 284
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Tel: +39 06 95583750
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Eutimio Monaco
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Giuseppina Napoli
giuseppina.napoli@emonacolex.com

info@emonacolex.com

Studio Legale Monaco & Associati is an independent Italian law firm which has established itself within a short period as one of the leading Italian law firms specialising within the antitrust and telecommunication field.

The firm employs leading experts in each field of practice; this enables Monaco & Associati to offer a unique breadth as well as depth of professional legal services.

The firm can also rely on established relationships with leading international firms, allowing us to provide global assistance to our clients in the most sophisticated cross-border transactions as well as any kind of foreign issues.

Monaco & Associati claims top expertise in the telecommunications field, focusing on regulatory and legal matters. In particular the firm assists clients with dealings before domestic and EU regulation authorities, as well as with litigation and arbitration proceedings. The firm is highly reputed, particularly with regard to its expertise in private enforcement of antitrust law. The firm also has great experience in privacy law, administrative law and e-commerce.

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