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Pricing and consumer protection

Retail pricing

What rules govern retail pricing for telecoms services?

The market for end customer prices is not subject to regulation.

Consumer contracts

What rules govern consumer service contracts?

Agreements with end users are not subject to regulation by the Federal Network Agency (BNetzA), but the Telecoms Act sets out certain requirements for such agreements – for example, Section 43b sets out the term and Sections 43a and 93 set out the information which must be given to a consumer in the agreement. However, agreements and the conclusion of such agreements must adhere to mandatory German law. For example, the Telecoms Act contains certain requirements regarding price announcements and further consumer protection issues. Further, general consumer protection law (eg, the consumer’s right to withdraw from a distance selling contract within 14 days) must be met.

In addition, agreements are subject to the strict German terms and condition law.

Particularly in the field of value added services, an industry code limits the possibilities to offer and to provide products to end customers.

Disclosure requirements

Are telecoms service providers bound by any consumer disclosure requirements?

The Transparency Ordinance entered into force in January 2017 and sets out the following duties for telecoms service providers:

  • supplying the customer with a standardised product information sheet containing all relevant information on the purchased service package;
  • providing information on the actual data transfer rate in comparison to the rate stated in the service contract; and
  • providing information on minimum contract duration on each customer bill.

Further, under Section 6 of the Telecoms Act, in a publicly accessible register the notified information is visible to everyone.

Competition

Issues and concerns

Are there any particular competition issues or concerns in the domestic telecoms market?

The Federal Cartel Office (FCO) is generally responsible for the enforcement of the Competition Law, while the Federal Network Agency (BNetzA) is responsible for certain sector-specific competition issues regarding telecoms service providers. If the thresholds of Article 1 of the EU Merger Regulation are exceeded, the European Commission must rule on merger control (rather than the FCO).

Regarding the market definition and analysis to be conducted by the BNetzA pursuant to the Telecoms Act, the BNetzA will make decisions in conjunction with the FCO. Regarding proposed remedies, the BNetzA will listen to the FCO, but is not required to adhere to the FCO’s view. Pursuant to the Telecoms Act, the BNetzA must accommodate the comments of the European Commission and the Body of European Regulators for Electronic Communications regarding market regulation in cooperation and consultation proceedings.

The last significant merger in Germany was finalised in 2014 when the European Commission and the BNetzA approved the acquisition of E-Plus by Telefónica Germany from its Dutch parent company KPN. This approval was given on condition that Drillisch, a smaller mobile operator, was allowed to take over 20% of the network capacity of Telefónica Germany.

Sector-specific regulation

Do any sector-specific competition regulatory/legal provisions apply (eg, special conditions for dominant telecoms market players)?

As described above, companies with significant market power must share infrastructure on the basis of standardised agreements, which must be authorised by the BNetzA.

Separation

Are there any requirements for structural, functional or accounting separation of operators’ activities?

At present, no structural, functional or accounting obligations apply to any operator.

Section 40 of the Telecoms Act authorises the BNetzA to order a functional separation of the operators of telecoms infrastructure and third services. However, Section 40 presupposes that no effective competition is created by other measures (eg, final control and access control). As, according to the BNetzA, there is effective competition (even though there are companies with significant market power), the BNetzA has never made use of the Section 40 authorisation.

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