The European Commission has published Part 1 of a Recommendation on the major supply conditions for wholesale leased lines, including leased line part circuits (also known as 'partial private circuits', 'leased line interconnection' and 'half links' in some Member States).
Information provided by the Member States to the European Commission has brought to light that there are major variations in the delivery times for retail and for end-to-end wholesale leased lines and for leased line part circuits.
In order to remedy such a situation, national regulatory authorities may impose (on SMP operators) obligations of non-discrimination for the provision of wholesale leased line services. The European Commission emphasises that this principle of non-discrimination applies to all relevant aspects of the services provided, such as ordering, migration, delivery, quality, repair time, reporting and penalties. The Commission deems that these matters are most appropriately established by means of a service level agreement (SLA).
Contractual delivery times should be included in the SLA so as to ensure that the delivery times for wholesale leased lines provided by an SMP operator to its competitors are not discriminatory compared to those provided for its own retail arm. These delivery times should therefore, according to the European Commission, be sufficiently below delivery times as observed on the retail markets.
The European Commission has published best practice figures for the overall delivery times of leased lines, in order to help national regulatory authorities to ensure that contractual delivery times applied to wholesale leased lines and leased line part circuits provided by operators with an obligation for non-discrimination, do not prevent competing operators from offering similar delivery times when making use of these wholesale inputs to build their own services.
The European Commission Recommendation of 21 January 2005 on the provision of leased lines in the European Union Part 1 – Major supply conditions for wholesale leased lines, recommends the following:
1. When imposing or maintaining an obligation for non-discrimination under Article 10 of the Access Directive or Article 18 and Annex VII of Directive 2002/22/EC (the "Universal Service Directive") with regard to operators providing leased line services (hereinafter referred to as ‘designated operators’), national regulatory authorities should:
(a) ensure that contracts include enforceable agreements (hereinafter referred to as ‘service level agreements’) which cover all relevant aspects of the wholesale leased line services provided such as ordering, migration, delivery, quality, repair time, reporting and dissuasive financial penalties.
(b) ensure that the contractual delivery times for wholesale leased lines in these service level agreements are as short as possible for each category of lines. Contractual delivery times at the wholesale level should be in any case shorter than best current practice delivery times of designated operators in retail markets. Best current practice delivery times of designated operators in the retail markets for 64 kbit/s, 2 Mbit/s unstructured, 2 Mbit/s structured and 34 Mbit/s unstructured are given in the Annex. The methodology used to calculate the best current practice figures given in the Annex is considered to be appropriate to cover recognised differences of network structures and delivery procedures between different designated operators in different Member States.
(c) ensure in particular that financial penalties included into the contracts as referred to in paragraph (a) apply in cases of delayed delivery of lines and consist of a specified amount for each day of delay for each line ordered; the contract shall provide also that the amount shall not be due where and insofar as the designated operator provides proof that the reason for the delay does not lie on him.
(d) ensure that the information necessary to prepare any review of this recommendation is provided in accordance with Article 5(1) of Directive 2002/21/EC (the “Framework Directive”) and report this information to the Commission in accordance with Article 5(2) of the Framework Directive.
The European Commission adds to this recommendation that the recommended ceilings for contractual delivery times (based on the third lowest value observed in the Member States) for designated operators should be the following:
- For 64 kbit/s leased lines: 18 calendar days
- For 2 Mbit/s leased lines unstructured: 30 calendar days
- For 2 Mbit/s leased lines structured: 33 calendar days
- For 34 Mbit/s leased lines unstructured: 52 calendar days
The full text of the European Commission Recommendation of 21 January 2005 on the provision of leased lines in the European Union Part 1 – Major supply conditions for wholesale leased lines can be accessed by clicking here.