Universal Service Directive: Commission refers Portugal to the Court

21 Nov 2018

The European Commission has referred Portugal to the Court of Justice of the EU to ensure a correct implementation of the Universal Service Directive, as regards the financing of universal service obligations. This is contained in a press releaseissued in 8 November, 2018.

Member States of the EU are allowed to introduce compensation mechanisms to balance the costs of the provision of universal service, which are not always profitable. According to the release however, Portuguese authorities have imposed an obligation on telecom operators to compensate the net costs of all universal services provided from 2007 by the telecom service provider. Portugal did this in 2012 by exploring the possibilities of provided the Electronic Communication Law (No 5/2004), by enacting a new law which establishes an extraordinary contribution by the operators.

The EC finds this extraordinary contribution in 3 consecutive years levied on operators for the financing of the net cost of the universal service in the past as contrary to EU law. This is because it infringes on the requirements of transparency, non-discrimination and least market distortion established by the Universal Service Directive (Directive 2002/22/EC) in force in the EU since 2002. The commission is accordingly calling on the Court of Justice of the EU to confirm that the extraordinary compensation infringes this Directive.

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Internet access is growing rapidly, yet large groups of people remain unconnected to the Internet. As of 2015, about 43% of people had access to the Internet (in developing countries only 34%). Access to ICTs is part of the Sustainable Development Agenda, which commits to ‘significantly increase access to ICTs and strive to provide universal and affordable access to the Internet in least developed countries by 2020’ (Goal 9.c).


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