Bundled up again: ECJ rejects general prohibition of bundled sales in telecoms

Posted on March 11, 2010 | Filed Under communication technologies 

If you have broadband internet service, do you still need traditional (PSTN) telephony service? Obviously, TP, the Polish incumbent telecoms operator, thought it would not be a good idea to give consumers too much choice on that issue, and fought a decision by the Polish NRA, which had required it to end a practice of “making the conclusion of a contract for the provision of ‘neostrada tp’ broadband internet access services contingent on the conclusion of a contract for telephone services.”

Polish national telecommunications law says that a service provider may not make the conclusion of a contract for the provision of publicly available telecommunications services contingent on the conclusion, by the end‑user, of a contract for the provision of other services or the purchase of equipment from a specific provider. This requirement is completely independent from the results of market analysis under the eclctornic communications framework and applies to all providers, regardless of market share or other specific circumstances.

The Polish Supreme Administrative Court asked the European Court of Justice, whether Community law permits the Member States “to introduce a prohibition, directed at all undertakings providing telecommunication services, on making the conclusion of a service-provision contract contingent on the purchase of another service (combined sale)  and, in particular, does a measure of this kind go beyond what is necessary to attain the objectives of the directives contained in the telecommunications package […]”

In today’s judgment C-522, Telekomunikacja Polska, the ECJ first said YES:

“the Framework Directive and the Universal Service Directive must be interpreted as not precluding national legislation, such as Article 57(1)(1) of the [Polish] Law on Telecommunications, which prohibits making the conclusion of a contract for the provision of services contingent on the conclusion, by the end‑user, of a contract for the provision of other services.”

This is because the Framework Directive and the Universal Service Directive “do not provide for full harmonisation of consumer-protection aspects. Article 20 of the Universal Service Directive, which relates to contracts concluded between consumers and providers of electronic communications services, states that it applies without prejudice to European Union rules on consumer protection and national rules in conformity with European Union law” (paragraph 29 of the judgment.

And then the Court said NO:

“However, Directive 2005/29/EC […] (‘Unfair Commercial Practices Directive’) must be interpreted as precluding national legislation which, with certain exceptions, and without taking account of the specific circumstances, imposes a general prohibition of combined offers made by a vendor to a consumer.”

This comes straight from the judgment of 23 April 2009, C-261/07 and C-299/07, VTB-VAB and Galatea.

To sum it up: member states may go beyond the framework and universal service directive to impose stronger consumer protection requirements for consumer-contracts for electronic communications services, but they must take care that these consumer protection rules do not contravene other existing Union rules. Which is, of course, what it says (in other words) in article 20, first paragraph, of the universal service directive.

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