On 24 October 2014, ComReg issued two separate Information Notices to eircom confirming that - despite ComReg’s views that eircom was in non-compliance with its non-discrimination obligations in the Irish Access Regulations - ComReg had decided not to apply to the High Court for formal enforcement action:
The Information Notices related to previous notices of non-compliance issued to eircom in November 2010 (and amended in October 2011), and August 2013 (respectively). The November 2010 notice was based on a complaint made by BT Communications Ireland Limited (“BT”) regarding eircom’s bid submissions to Telefónica Ireland Limited (“O2 Ireland”) now part of mobile network operator, Three.
Pursuant to a 2008 ComReg Decision (D06/08), eircom has been designated with having significant market power (“SMP”) in the market for wholesale terminating segments of leased lines – on foot of which eircom is subject to a number of regulatory obligations, including obligations of access, non-discrimination, transparency and cost orientation.
It seems that ComReg’s decision not to exercise its discretion and apply to the Irish High Court for formal enforcement action (eg, by way of an order compelling compliance and/or payment of a financial penalty etc) was – at least in the case of BT’s complaint – based on technical issues arising from ComReg’s powers under the legislation in force, at the time.
Those familiar with the Irish telecoms regulatory framework will recognise that the November 2010 notice of non-compliance was issued on the basis of the previous 2003 Access Regulations – by the time of the second notice of non-compliance in August 2013, the 2003 Access Regulations had been replaced by the 2011 Access Regulations (which are currently in force). Under the 2003 Access Regulations the relevant section enabling ComReg to issue a notice of non-compliance and seek to take more formal enforcement action by way of applying to the Irish High Court for an appropriate order (eg, to compel compliance with or without financial penalty) did not explicitly include cases of ‘ongoing’ non-compliance (see in particular, Regulations 18(1) and 18(4) of the 2003 Access Regulations).
Instead the Regulations referenced only historic cases of non-compliance:
“18(1) Where [ComReg] [sic] finds that a person has not complied with an obligation under these Regulations or a direction under Regulation 17, [ComReg] [sic] shall notify the person of those findings and give the person an opportunity to make representations in relation to the notification or remedy any non-compliance…”
“18(4) Where, at the end of the period referred to in paragraph (1), [ComReg] [sic] is of the opinion that the person concerned has not complied with an obligation or direction, [ComReg] [sic] may, subject to paragraph (13), apply to the High Court for such order as may be appropriate by way of compliance with the obligation or direction….” (emphasis added)
Accordingly, ComReg indicated in its Information Notice of 24 October 2014, that ComReg considered it was not appropriate to apply to the High Court for such order.
This apparent ‘oversight’ has been corrected in the 2011 Access Regulations. In particular, Regulation 19(4) of the 2011 Access Regulations provides that where ComReg has issued a notice of non-compliance under Regulation 19(1), and despite the operator/undertaking having been given an opportunity to state its views, ComReg is still of the opinion that the relevant operator / undertaking has not complied with its obligations etc, ComReg may “whether or not the non-compliance is continuing”, apply to the High Court for formal enforcement action.
The August 2013 notice of non-compliance was issued on the basis of the 2011 Access Regulations. As noted above, the 2011 Regulations do not contain the above constraint on ComReg’s ability to seek formal enforcement action for cases where non-compliance is ongoing. However, on the facts this did not seem to be a material factor in the second case.
According to ComReg’s 24 October 2014 Information Notice, following the August 2013 non-compliance notice issued to eircom and expiry of the usual one month period given under the 2011 Access Regulations for eircom to state its views, eircom provided ComReg with additional information regarding eircom’s internal controls to ensure compliance with its non-discrimination obligations.
At first sight, the provision of additional information alone did not seem to have won the day for eircom. ComReg indicated in its October 2014 Information Notice that “while ComReg generally welcomes this and has provided comments to eircom in respect of these internal controls, ComReg will continue to monitor eircom’s compliance”.
However, in a somewhat change of heart, ComReg confirmed later in its Information Notice that in light of the assurances given and the specifics of the case, ComReg had decided not to apply to the High Court for a compliance order.
It is not the first time that despite initial indicators of non-compliance ComReg has decided not to take formal compliance action against eircom under the 2011 Access Regulations – see for example, ComReg’s September 2014 Information Notice. Taken together, these two later cases represent somewhat of a ‘hat trick’ for eircom!
The result for eircom certainly seems to suggest that if faced with a non-compliance investigation there is always merit in trying to mend one’s ways and provide sufficient assurances to ComReg on future compliance.