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The Technology, media and Telecommunications Review Law Business Research Second Edition Editor John P Janka
The Technology, media and
Telecommunications Review
Law Business Research
Second Edition
Editor
John P Janka
The Technology, Media and Telecommunications Review
second ediTion
Reproduced with permission from Law Business Research Ltd.
This article was first published in The Technology, Media and Telecommunications Review, 1st edition
(published in october 2010 – editor John P Janka).
For further information please email [email protected]
The Technology, Media and
Telecommunications
Review
second ediTion
editorJohn P Janka
Law Business Research Ltd
PuBLisheR Gideon Roberton
Business deveLoPMenT MAnAGeR Adam sargent
MARkeTinG MAnAGeRs nick Barette, katherine Jablonowska
MARkeTinG AssisTAnT Robin Andrews
ediToRiAL AssisTAnT Lydia Gerges
PRoducTion MAnAGeR Adam Myers
PRoducTion ediToRs Joanne Morley
suBediToR caroline Rawson
ediToR-in-chieF callum campbell
MAnAGinG diRecToR Richard davey
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The publisher acknowledges and thanks the following law firms for their learned assistance throughout the preparation of this book:
ABou JAoude & AssociATes LAW FiRM
AdvokATsko dRuZhesTvo AndReev, sToYAnov & TsekovA in cooperation with schoenheRR
BAhAR & PARTneRs
BAkeR & MckenZie.WonG & LeoW
cLeARY GoTTLieB sTeen & hAMiLTon LLP
edWARd nAThAn sonnenBeRGs
eLvinGeR, hoss & PRussen
GeoRGiAdes & MYLonAs, AdvocATes & LeGAL consuLTAnTs
Jones dAY
kocián ŠoLc BALAŠTík, AdvocATes
kRoMAnn ReuMeRT
LAThAM & WATkins LLP
LAThAM & WATkins GAikokuho JoinT enTeRPRise
M&M BoMchiL
MinTeR eLLison
RoschieR AdvokATBYRå AB
RoschieR ATToRneYs LTd
sAid AL shAhRY LAW oFFice
AcknoWLedGeMenTs
ii
Acknowledgements
schoenheRR & AsociATii scA
schoenheRR ATToRneYs AT LAW
seTh duA & AssociATes
shALAkAnY LAW oFFice
snR denTon
uRíA MenéndeZ – PRoençA de cARvALho
WALdeR WYss LTd
Yoon & YAnG LLc
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Editor’s Preface ................................................................................................viiJohn P Janka
List of Abbreviations ................................................................................................. ix
Chapter 1 ARGenTinA ����������������������������������������������������������������������� 1Francisco M Gutiérrez and Héctor M Huici
Chapter 2 AusTRALiA ������������������������������������������������������������������������14Anthony Lloyd, Paul Kallenbach and Paul Schoff
Chapter 3 AusTRiA ����������������������������������������������������������������������������30Christian Schmelz and Andreas Orator
Chapter 4 BuLGARiA �������������������������������������������������������������������������40Radoslav Chemshirov
Chapter 5 cYPRus ������������������������������������������������������������������������������50Yiannos G Georgiades and Rebecca E Howarth Seaberg
Chapter 6 cZech RePuBLic �����������������������������������������������������������67Drahomír Tomašuk
Chapter 7 denMARk �������������������������������������������������������������������������81Torben Waage, Louise Sofie Falch, Martin Dahl Pedersen and Daniel Herman Røjtburg
Chapter 8 eGYPT ��������������������������������������������������������������������������������92Aly El Shalakany and Omar Sherif
Chapter 9 euRoPeAn union �������������������������������������������������������102Maurits J F M Dolmans, Francesco Maria Salerno and Malik Dhanani
conTenTs
iv
Contents
Chapter 10 FinLAnd �������������������������������������������������������������������������131Mikko Manner, Anna Haapanen and Vilhelm Schröder
Chapter 11 FRAnce ���������������������������������������������������������������������������142Myria Saarinen and Jean-Luc Juhan
Chapter 12 GeRMAnY �����������������������������������������������������������������������154Zahra Rahvar
Chapter 13 honG konG������������������������������������������������������������������167Simon Berry and Vi Vi Chow
Chapter 14 indiA �������������������������������������������������������������������������������181Atul Dua, Rahul Goel and Anu Monga
Chapter 15 indonesiA ���������������������������������������������������������������������194Dewie Pelitawati and Melanie Hadeli
Chapter 16 iTALY ��������������������������������������������������������������������������������206Stefano Macchi di Cellere
Chapter 17 JAPAn �������������������������������������������������������������������������������218Hiroki Kobayashi, Tim Johnson and Tomohiko Kamimura
Chapter 18 koReA �����������������������������������������������������������������������������232Wonil Kim and Kwang-Wook Lee
Chapter 19 LeBAnon ������������������������������������������������������������������������244Souraya Machnouk, Rania Khoury, Anis Nasr and Ziad Maatouk
Chapter 20 LuxeMBouRG ���������������������������������������������������������������255Franz Fayot and Linda Funck
Chapter 21 oMAn ������������������������������������������������������������������������������271Syed Ali Naveed Arshad and Stephen T Sayer
Chapter 22 PoRTuGAL ����������������������������������������������������������������������281Jacinto Moniz de Bettencourt, Joana Torres Ereio and João de Sousa Assis
Chapter 23 RoMAniA ������������������������������������������������������������������������294Adriana Năstase and Ionuţ-Alin Sava
v
Contents
Chapter 24 sinGAPoRe ��������������������������������������������������������������������305Ken Chia and Koh See Khiang
Chapter 25 souTh AFRicA ��������������������������������������������������������������327Zaid Gardner
Chapter 26 sWeden ��������������������������������������������������������������������������340Erik Ficks, Björn Johansson and Malin Falkmer
Chapter 27 sWiTZeRLAnd ���������������������������������������������������������������351Hans Rudolf Trüeb and Samuel Klaus
Chapter 28 uniTed ARAB eMiRATes ���������������������������������������������363Joby Beretta
Chapter 29 uniTed kinGdoM ������������������������������������������������������376Omar Shah and Gail Crawford
Chapter 30 uniTed sTATes �������������������������������������������������������������392John P Janka and Jarrett S Taubman
Appendix 1 ABouT The AuThoRs ������������������������������������������������408
Appendix 2 conTRiBuTinG LAW FiRMs’ conTAcT deTAiLs ����� 429
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editor’s preface
The recent passing of tMt pioneer steve Jobs provides an appropriate moment for reflecting on the impact that innovation in the sector has had on our lives, and how it also has driven – and outpaced – the development of the law.
dramatic advances in microchips have fuelled the digital revolution, spawning a wide range of devices and services that our parents never could have imagined. The iphone, the ipad, itunes and the ipod are but a few examples of technological changes that have challenged old ways of doing business, and also have changed society. We are connected to our work and our social circles anywhere we go; we instantaneously access vast information resources from mobile devices; and we watch films and tV programmes, and listen to music, of our choosing, whenever and wherever we want.
similarly, the internet has changed the way people communicate, and has altered our preferences for receiving information and entertainment. internet-based businesses have challenged traditional media businesses, such as print newspapers, print magazines, and television and radio broadcasting. internet media delivery is now challenging more recently developed forms of media–cable and satellite delivery of subscription video programming. as a result, the legal constructs once put in place to govern media outlets are changing.
The existing telecommunications infrastructure is becoming outmoded. ‘twisted pair’ (copper) is being bypassed in favour of fibre and wireless, as existing phone lines cannot readily support the increasing demand for broadband speeds and throughput. a robust wireless communications infrastructure is necessary to support the booming demand for mobile broadband connectivity to smart phones and tablets. as a result, government policy is evolving to support the deployment of broadband infrastructure, and to facilitate the growth of mobile services; but regulatory change never seems to occur fast enough. While nations are making significant investments to deploy high-speed broadband services to their citizens, significant private investment is still needed for tomorrow’s critical telecommunications and information infrastructure.
Historical spectrum planning did not provide for the current wireless boom. as a result, no incumbent user of spectrum is safe in the refarming of existing spectrum bands. The transition from analogue to digital signal forms is leading to more efficient use of the spectrum, and also is facilitating new approaches to sharing radio spectrum.
Editor’s Preface
viii
regulators are coming under increasing pressure to capture the value associated with the spectrum bands that are being opened for these new purposes.
The broadband revolution has eliminated one information bottleneck that once existed when consumers had to rely on a few newspapers, tV stations and radio stations. Now they are able to use internet-based services such as facebook and twitter – albeit sometimes in the face of governmental attempts to stem the free flow of information to and from their jurisdictions. other ‘gatekeepers’ are developing in the distribution chain as application service providers seek to constrain access to certain content, whether by using their influence to cause broadband providers to block access to that content entirely, or to prioritise one information source over another.
We are being monitored, and our personal information is being collected, stored and mined, in a manner that regulators never envisioned and that the law is not well-suited to constrain. Virtually every internet access and wireless device we use knows were we are, and tracks what we do. While this personal information can be used for purposes that some may find desirable (such as targeting products and services to us), gathering and storing that information virtually eliminates any expectation of privacy. in many jurisdictions, the law is inadequate to manage the chances for abuse and the consequences of security breaches.
This second edition of The Technology, Media and Telecommunications Review expands to 30 the jurisdictions in which we provide an overview of the legal constructs that govern these types of issues. While the authors cannot fully address every one of these topics in the following articles, we do hope this book provides a helpful framework for your analysis.
John P JankaLatham & Watkins LLpWashington, dcoctober 2011
ix
List of aBBreViatioNs
3G Third-generation (technology)4G fourth-generation (technology)adsL asymmetric digital subscriber linearpU average revenue per userBiap Broadband internet access providersBWa Broadband wireless accesscatV cable tVcdMa code division multiple accesscMts cellular Mobile telephone systemdaB digital audio broadcastingddos distributed denial-of-servicedos denial-of-servicedsL digital subscriber linedtH direct-to-homedttV digital terrestrial tVdVB digital video broadcastdVB-H digital video broadcast – handhelddVB-t digital video broadcast – terrestrialecN electronic communications networkecs electronic communications serviceedGe enhanced data rates for GsM evolutionfac full allocated historical costfBo facilitates-based operator’ftNs fixed telecommunications network servicesfttc fibre to the curbfttH fibre to the homefttN fibre to the nodefttx fibre to the xfWa fixed wireless accessGb/s Gigabits per secondGB/s Gigabytes per second
x
GsM Global system for mobile communicationsHdtV High-definition televisionHits Headend in the skyHspa High-speed packet accessict information and communications technologyiptV internet protocol televisionicp internet content providerisp internet service providerkb/s Kilobits per secondkB/s Kilobytes per secondLaN Local area networkLric Long-run incremental costLte Long term evolution (a next-generation 3G and 4G
technology for both GsM and cdMa cellular carriers)Mb/s Megabits per secondMB/s Megabytes per secondMMs Multimedia messaging serviceMMds Multichannel multipoint distribution serviceMso Multi-system operatorsMVNo Mobile virtual network operatorMWa Mobile wireless accessNfc Near field communicationNGa Next-generation accessNic Network information centreNra National regulatory authoritypNets public non-exclusive telecommunications servicepstN public switched telephone networkrf radio frequency sBo services-based operatorsMs short message servicestd–pcos subscriber trunk dialling–public call offices Uas Unified access servicesUasL Unified access services licenceUHf Ultra-high frequencyUWB Ultra-widebandUMts Universal mobile telecommunications service Uso Universal service obligationVdsL Very high speed digital subscriber lineVHf Very high frequencyVod Video on demandVoB Voice over broadbandVoip Voice over internet protocolWiMaX Worldwide interoperability for microwave access
List of Abbreviations
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Chapter 12
GermanyZahra Rahvar*
I OvervIew
ICT contributes more to wealth creation in Germany than the traditional technologies of automotive and mechanical engineering. With an annual business volume of approximately €145.5 billion, the ICT sector is one of the largest economic sectors in Germany. more than 850,000 people are employed in the sector itself, and an additional 650,000 ICT specialists are employed in user sectors. It has become a driving force in Germany’s economy and, naturally, the legislator has to adjust the legal framework of media law accordingly.
By focusing on key issues such as convergence, mobility and networking, the government has tried to advance the information society through targeted policies to modernise legal and technical frameworks and to promote research and market-oriented development. as part of this overall effort, the government adopted a programme entitled ‘Information Society Germany 2010’ (‘iD2010’). The iD2010 programme is specifically tailored to the needs of the ICT sector.1
moreover, the question as to whether media convergence as a technological phenomenon inevitably will lead to a convergence in media law is the subject of much lively debate in the political and academic fields; the discussion is ongoing in Germany, with no clear trend apparent. The area of application of media law needs to be clarified, in light of the appearance of new and increasingly interconnected services along the
* Zahra rahvar is an associate at Latham & Watkins LLP.1 See www.bmwi.de/english/navigation/Service/publications,did=192754. The government
tries to support the process of convergence by adapting the legislative framework for telecommunications and media services at the national and european levels, by implementing a frequency policy geared to more efficiency and flexibility and by participating in joint initiatives.
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convergence trend, and services need to be unambiguously and distinctly assigned to their suitable legal frameworks.
II reGULATION
i The regulators
Due to the federal policy of considering media as a ‘fourth division’ of power and a tendency to deregulate and decentralise, there is no single media authority in Germany. all television and radio broadcasters are subject to state control. Public-service broadcasters are supervised by internal committees, and content-related supervision is carried out by the respective broadcasting council, whose administrative board supervises all management decisions made by the director.
Private broadcasters, however, are subject to external supervision. The competent authority is the state media authority of each German state,2 whose responsibilities – apart from the supervision itself – includes granting authorisation according to article 22, Paragraph 1 of the Inter-State Broadcasting Treaty (‘the rStV’), and assigning transmission capacities. Private and public television broadcasting in Germany is governed by the 1987 rStV, which outlines the side-by-side existence of public and commercial broadcasting. The provisions of the rStV have been modified 15 times, but the 14th modification of 2010 did not become effective because it had not been ratified by the state parliament of north-rhine-Westphalia. Further legal sources, at a federal level, are various interstate treaties, especially on the Protection of Human Dignity and the Protection of minors in Broadcasting and in Telemedia (‘the JmStV’) and on european-level directives (e.g., the Television without Frontiers’ Directive, treaties and conventions). In addition, there are individual state media laws.
The state media authorities are responsible for general access regulation, (e.g., access to broadband services and other platforms) as well as additional applications like control systems and navigators.3 They also have a wide range of powers with which to supervise broadcasters, such as warnings, prohibition or withdrawal and revocation of licences.4
all private broadcasters must be registered. Commercial broadcasters require a licence for the purpose of providing broadcasting services. according to article 20, Paragraph 2 of the rStV, the provider of an electronic information and communications service – if it is to be categorised as broadcasting – requires a licence. If the competent state media authority determines that this is the case, the provider, after being notified of this determination, must submit a licence application within three months to provide the relevant information in such a manner that the service can be categorised as broadcasting.
2 Several states have joint media authorities, such as Berlin and Brandenburg as well as Hamburg and Schleswig-Holstein.
3 article 53 of the rStV.4 article 38 Paragraph 2 of the rStV.
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If an enterprise wishes to obtain a licence as a national broadcasting service provider, it needs to be a natural or legal person who:5
a has unlimited legal capacity;b has not lost the ability to serve in a public capacity as a result of a legal ruling;c has its seat of residence or seat in Germany, another member State of the european
Union or another state of the european economic area (eea) and can be pursued by court; and
d warrants that in providing broadcasting, it will respect the legal provisions and any administrative acts passed thereon.
The state media authorities work together in licensing and supervision as well as in the development of commercial broadcasting in fundamental questions, primarily with a view to the equal treatment of commercial TV and radio broadcasters. Their tasks are laid down in the ‘Basic Principles for the Collaboration of the association of State media authorities in the Federal republic of Germany’ of 20 January 2004 (‘the aLm Statute’). The main focus of the collaboration of the state media authorities is the promotion of programming diversity and thus freedom of information and opinion in commercial television and radio. This involves, in addition to controlling media power by means of licensing limitations and licence monitoring, also the promotion of the media literacy of viewers and listeners.
The state media authorities are also responsible for compliance of commercial TV and radio broadcasters with basic programming principles. They also oversee the observance of regulations on advertising limitations or the protection of minors. The common tasks are carried out by the regulatory affairs Commission, the Directors’ Conference of the State media authorities, the Committee Chairpersons’ Conference, the Commission for the Protection of minors in the media and the Commission on Concentration in the media (‘the KeK’).
The compliance of telecommunications companies with the Telecommunications act is monitored by the Federal network agency (‘the Bnetza’). The agency ensures the liberalisation and deregulation of the telecommunications, postal and energy markets through non-discriminatory access and efficient use-of-system charges. It is responsible, inter alia, for securing efficient and interference-free use of frequencies and protecting public safety interests. apart from regulation, the Bnetza performs a number of other tasks related to the telecommunications market such as administering frequencies and telephone numbers, detecting radio interference and offering advice to citizens on new regulations and their implications.
German telecommunications law has developed in accordance with the european regulations. The 2002 Telecoms Package caused fundamental changes to the previous German telecommunications law and was implemented into the German Telecommunications act (‘the TKG’) on 22 June 2004. Since then, minor changes have been implemented (e.g., on data retention).
5 article 20a, Paragraph 1 of the rStV.
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The draft German legislation to implement the 2009 Telecoms Package, the TKG-amendment 2011, is still under discussion, but it is planned to have the parliament pass it by the end of 2011 with a six month delay against the eU implementation deadline.
ii regulated activities6
German telecommunications law does not oblige telecommunications services or network providers to apply for a general licence; however, in accordance with the access Directive, it requires certain providers such as public telecommunications network providers or providers of public telecommunications services to notify the Federal network agency when they start to provide the services or the network.7 a notification is not necessary for non-public telecommunications networks or services.
enterprises importing ICT products to Germany must make sure that their goods are Ce certified. The Ce mark identifies a product as complying with eU health and safety standards. Depending on the type of product, conformity can be proven by the manufacturer or with the involvement of an authorised body. manufacturers and importers must be aware that in Germany, software and other ICT products must be modified according to the country’s customs and language.
iii Ownership and market access restrictions
German law generally makes no distinction between Germans and foreign nationals regarding investment or the establishment of companies; however, it provides for certain restrictions on foreign capital and investment. The German Federal ministry of economics and Technology may prohibit certain acts that might interfere with German interests. Inter alia, these interests are the general security of Germany or the acquisition of a company or parts of a company that is vital to the security of Germany according to Section 7, Paragraph 2 of the Foreign Trade Law.
Telecommunications services are deemed essential for Germany’s security, and the German Telecommunications act imposes certain obligations in that regard on telecommunications providers. agreements relating to telecommunications services can be negotiated freely (e.g., payment terms, currency and billing) with business or carrier customers if no party has significant market power (in which case, price terms are regulated by the TKG and a provider with significant market power is not able to choose its customers freely).
The TKG also provides for mandatory minimum liability for telecommunication providers. The provider’s liability for a publicly available telecommunications service can be capped at compensation for damages in the amount of €12,500 with regard to an individual end-user if the provider’s infringing act was not wilful. The total liability with
6 The German ICT industry generates a sales volume of about €145.5 billion annually. It has a market share in europe of 18.9 per cent. It is europe’s largest ICT market with a market share of 20 per cent and the fourth largest worldwide. The sector imported €38.6 billion in 2009, with ICT hardware products making up almost half of the imports. The industry has a workforce of 846,000 employees and about 73 per cent of the German private households have Internet access.
7 Section 6 of the TKG.
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regard to end-users for a single event can be capped at an amount of €10 million if the provider’s infringing act was not wilful.
The Inter-State Broadcasting Treaty contains special ownership control provisions8 that are designed to ensure media plurality objectives. These rules apply in addition to the general merger control regime and are administered by the KeK.
iv Transfers of control and assignments
The German merger control provisions are enforced by the Federal Cartel Office (‘Bkarta’) in Bonn. The current legislation can be found in Chapter VII of the GWB, which deals with the control of concentrations affecting the German market.
The filing of merger notifications in Germany is mandatory if the turnover thresholds according to Section 36, Paragraph 2 of the GWB are met and none of the de minimis exemptions9 apply. In addition, the completion of a (cleared) merger must also be announced without undue delay (post-completion notice). This, however, is a mere formality.10 If the statutory conditions for prohibition are fulfilled, the Bkarta will prohibit the merger. It also has the power to order the divestment or the disposal of certain assets where a merger has already been completed.
mergers that are subject to merger control may not be completed before either the Bkarta has cleared the transaction or the relevant waiting periods of one month (first phase) or four months (first and second phases together) after submission of a complete notification has expired without the Bkarta having prohibited the transaction.
For the purpose of notification, the GWB requires, as a minimum, a description of the transaction to be given in the notification, and in addition, sets out the following required information in respect of all participating enterprises: a name;b place of incorporation;c type of business;d turnover of the parties involved (worldwide, in the eU and in Germany);e market shares of the parties in Germany and the basis of its own calculation if the
combined market shares amount to 20 per cent or more; andf in the case of an acquisition of shares in another company, information about the
shares already held in the target company and the shares to be acquired.
8 article 26 et seq. of the rStV.9 Two de minimis exemptions apply under the following conditions:
a one party to the merger achieved less than €10 million worldwide turnover (in the case of the target including the seller and all its affiliates, provided that the seller controls the target and, in the case of the acquirer, including all its affiliates); or
b the relevant market (which must have been in existence for at least five years) had a total annual value of less than €15 million in the last calendar year (‘de minimis ’ market clause).
10 See Getting the Deal Through: Merger Control 2011, www.gettingthedealthrough.com/books/20/jurisdictions/11/germany.
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There are no legal deadlines for a notification of a concentration, but notifiable concentrations must not be completed before clearance. Therefore, it is advisable to submit a notification well before the envisaged completion date. It is possible to file a pre-merger notification even prior to the signing of the transactional documents. Parties should also not forget to submit the mandatory post-completion notice to the Bkarta, which needs to be filed without ‘undue delay’ following completion of the transaction.11 In principle, all parties involved in a merger are responsible for filing. In the case of an acquisition of shares or assets, the vendor must also make a notification. In practice, the filing is often done by the acquiring firm also on behalf of all other parties involved. The GWB provides for filing fees payable to the Bkarta for merger proceedings. The fees can amount to up to €50,000.
Submission of an incorrect or incomplete filing constitutes an administrative offence and can lead to a fine of up to €100,000. The same applies to the failure to submit a post-merger completion notice or in cases of incomplete, incorrect or late notice.12
III TeLeCOMMUNICATIONS ANd INTerNeT ACCeSS
i Internet and Internet protocol regulation
Since the German parliament adopted the Telemedia act (‘the TmG’) on 18 January 2007, all IP-based services are now regulated under this act. The Telemedia act no longer distinguishes between ‘teleservices’, which were previously covered by the Teleservices act and ‘media services’, which were previously the subject of the Inter-State agreement on media Services. Instead, it combines the two concepts: commercial rules for telemedia are covered in the TmG, while content-related aspects are regulated in a specific section of the Inter-State Broadcasting Treaty (Sections 54 et seq.) and the Inter-State agreement on Protection of youth in the media. Telemedia services are permission-free and generally do not need to be registered.
Telecommunications services and telemedia services are mutually exclusive; therefore, telecommunications are excluded from the scope of the Telemedia act. In reality, the distinction is often difficult to make. In addition, the regulatory structure of telemedia services oscillates somewhere between unregulated press law and the framed supervision the television and radio broadcasters are under. Thus, the state media authorities are also the regulators of telemedia services.
ii Universal service
Germany currently has good broadband penetration, which compares well against international levels. Based on the currently accepted broadband definition of at least
11 Ibid.12 a fine of up to €1 million or, in the case of an undertaking, up to 10 per cent of its total
worldwide group turnover in the preceding business year, can be imposed if the notifying parties intentionally include or make use of incorrect or incomplete information in the notification with a view to causing the Bkarta to refrain from issuing a prohibition decision or from opening a second-phase investigation.
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1mb/s, penetration amounts to approximately 98.5 per cent of German households. Well over 70 per cent of households have potential access to transmission rates of at least 2mb/s, while some 20 per cent can avail themselves of high-speed Internet access through aDSL connections of up to 50mb/s.
The federal government, however, intends to give a further boost to the development of the broadband network in Germany, which will be achieved by capitalising on synergies in the construction of infrastructure, using the ‘Digital Dividend‘, formulating regulation that fosters investment and growth and through financial support. Various initiatives exist at the federal, state and local level – especially the German Broadband Initiative, under which the aim is to have nationwide broadband access no later than the end of 2010. a total of 75 per cent of all German households should have high-speed broadband access with transmission rates of at least 50mb/s by 2014. The government’s goal is to deliver nationwide access to this high-speed broadband as soon as possible.13
The federal government launched an initiative in spring 2010 to encourage innovative projects by promoting pilot schemes, and which supports local authorities that have developed exceptionally innovative solutions. It is hoped that these ‘broadband beacon projects’ will encourage businesses to pursue best-practice solutions. Small and medium-sized telecommunications companies in particular can borrow funds at terms that are in line with market conditions and with adequate risk pricing through Germany’s state-owned development bank’s (‘KfW’) corporate financing programme.
In any event, the existing and modified federal and state loan guarantee scheme is generally available to companies in the telecommunications sector to prevent economically desirable broadband projects from failing due to a lack of suitable finance. With these programmes, the federal states or the federal government and federal states together assume up to 90 per cent of the risk of default for project financing.
The government’s policy is to actively encourage people to use the Internet and to help them acquire skills in the area of new media by, for example, providing governmental services electronically (‘e-government’), transport and health-care telematics and the digitisation of cultural assets.
The ‘white areas’ in rural Germany are shrinking rapidly, partly due to ongoing investment by the network operators. The reduction has also largely been achieved thanks to the host of action programmes offered by the federal states, local authority broadband initiatives in the areas affected and the nationwide activities of associations such as the German association of Internet enterprises (eco), the association of the Providers of Telecommunications and Value-added Services and the association of Towns and municipalities.
The Dresden Declaration, published after the Fifth national IT summit in December 2010, examined the main challenges and identified solutions for high-speed networks in Germany. The development of a sustainable broadband network is seen as
13 The Federal ministry of economics and Technology (BmWi) will further develop its broad-band portal www.zukunft-breitband.de. apart from the Broadband atlas and best-practice examples, this portal also currently includes checklists for local authorities and information on financial support.
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an essential basis for the opening of new economic potential for growth and innovative business models.
The TKG amendment 2011 especially contains investments in fibre-optic networks, it is estimated that for the construction of next-generation networks between €36 and €117 billion will be needed.14
Terrestrial transmission in Germany is now exclusively digital after the last analogue transmitters were switched off in 2008. Digital satellite reception also continues to expand; the same applies for cable. But since the original switchover date – in 2010 – could not be met, at present, april 2012 is the new target date.
iii restrictions on the provision of service
The Federal network agency is responsible for the surveillance of broadband network owners to comply with the TKG.15 Currently, no general legal provision of the TKG hinders broadband network owners from actively managing and differentiating between data packages to be sent online. a legal requirement for ‘net neutrality’ can neither be deduced from provisions regarding access16 and fee regulations17 nor from Section 42 of TKG, which governs control of abusive practices.
The eU Commission has not yet regulated the issue of ‘net neutrality’. The eU focuses on transparency in the management of the network itself in order to protect consumers. The new eU regulation (Telecommunication Package) states that member States should ensure consumers are informed in a clear manner before conclusion of the contract and thereafter on a regular basis about any restriction of their access to legitimate content by the provider. moreover, national regulatory authorities can intervene so that operators have to publish comparable, adequate and up-to-date end-user information on the quality of their services.
In Germany, the current legal framework is considered sufficient to secure unimpaired communication via the Internet. So, in the coalition agreement of the governing parties in Germany only a narrow passage can be found on the subject of ‘net neutrality’. It states: ‘We trust that the existing competition ensures neutral data transmission on the Internet and other new media (net neutrality), but [must] carefully monitor the developments and meet if necessary with the objective of maintaining network neutrality’. Therefore, at present, there appears to be no political force in Germany that would drive this issue.18 additionally, Section 43a, Paragraph 2 number 2 of the draft TKG amendment states that consumers must be informed about limitations concerning the access and the use of services applications.
14 Körber, MMR 2011, 215 (215).15 See Section 126 of the TKG.16 Sections 16 to 26 of the TKG.17 Sections 27 et seq. and Sections 39 et seq. of the TKG.18 Schrey and Frevert, MMR 2010, 596 (599); Spies and Ufer, MMR 2010, 13 (17).
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iv Security
The federal government implemented the national Protection Plan for Information Structures (‘nPSI’) based on plans for specific target groups. The aim is to ensure a high level of IT security in the medium and long term. The nPSI addresses all social groups, including citizens and small and medium-sized enterprises. With regard to the latter, the focus is on making them aware of the risks involved in using IT and informing them about the protection mechanisms available. also, as of 5 December 2007, the Office of the Federal Government Commissioner for Information Technology was created. The Commissioner is the central point of contact for the states and the private sector when working with the federal government on IT matters. Unfortunately, there is no single act that regulates all the facets of IT security, so from a legal perspective, the matter is very disjointed.19
Privacy and consumer protectionIn order to better protect the privacy of individuals against intrusions of modern data processing, in a 1983 decision the Federal Constitutional Court developed the notion of individuals’ right to decide how their data are to be used.20 This right means that it is up to each individual to determine what and how much personal information he or she would like to reveal. This right to privacy is an element of the general right to free development of one’s personality, which is protected under article 2(1) in conjunction with article 1(1) of the German Constitution.
The collection, processing and use of personal data is governed by the German Federal Data Protection act. Its requirements are partially supplemented by the German act against Unfair Competition with regard to certain methods of marketing – particularly by e-mail and SmS – and by the Telemedia act. The German Federal Data Protection act applies mainly to federal public authorities and to non-public entities, such as corporations.
every private organisation is required to inform those persons whose personal data they are storing. However, some exceptions apply; for example, if the data subject is already aware of such storage from other sources, if the data are from publicly accessible sources or if they are to be kept confidential. Bodies responsible for processing data are required to correct information if necessary and to delete or block personal data if unlawfully stored or no longer needed. If a body responsible for processing data harms a data subject by unlawfully or incorrectly collecting, processing or using his or her personal data, and in doing so failed to act with due care, that body is liable for damages.
Individuals may request information from public and private organisations about stored data concerning them and the reason for storing these data. Private organisations are also required to indicate whether they regularly transmit these data to others, and if so, to whom.
19 Gaycken and Karger, MMR 2011, 3(6).20 Federal Constitutional Court Decision 65,1 [41].
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Protection for childrenyouth protection provisions applicable to the Internet can primarily be found in the Inter-State Treaty on the Protection of Human Dignity and the JmStV.
The Federal Department for the media Harmful to young Persons (‘the BPjm’) is the responsible authority for protecting children and adolescents in Germany from any media that might contain harmful or dangerous contents. This work is authorised by the youth Protection Law. The types of media monitored include videos, DVDs, computer games and Internet sites. The BPjm can act only on request of other administrative institutions, not on its own initiative. The German youth Welfare Departments, among others, can file a complaint; once an official request has been filed, the BPjm is obliged to process the complaint. Possible measures in the event of a violation are prohibition from publication, blocking the provider and fines up to €500,000.
Cybersecurity The parliament passed the act to Strengthen the Security of Federal Information Technology on 14 august 2009. according to Section 1 of the act, a Federal Office for Information Security (‘the BSI’) will be maintained as a superior federal authority, to be overseen by the Federal ministry of the Interior. The BSI is responsible for promoting IT security in Germany.21
Due to the complexity of IT problems, the spectrum of tasks facing the BSI is wide-ranging. according to Section 3 of the act, its tasks include developing criteria, procedures and tools to test and evaluate the security of information technology systems or components and to test and evaluate compliance with IT security standards, and developing technical security standards for federal information technology and for the suitability of information technology contractors in special need of protection. Furthermore, the BSI investigates security risks associated with the use of IT and develops preventive security measures, provides information on risks and threats relating to the use of information technology and seeks out appropriate solutions. This work includes IT security testing and assessment of IT systems, including their development, in cooperation with the industry. The BSI is organised into four divisions, one central and three specialised.
v The de-Mail Act
On 5 march 2011 the new De-mail act became effective. Through this it is now possible to offer new services for the communication via the Internet whose security is verified and accredited. De-mail services can be used as the basis for safer electronic legal and business relations. The electronic communication is now legally viewed at the same level as the paper based communication, with additional functionality.22
21 www.bsi.bund.de.22 roßnagel, NJW 2011, 1473 (1478).
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Iv SPeCTrUM POLICY
i development
Originally, frequencies in Germany were used exclusively – with a few exceptions – by Germany’s federal mail service (Deutsche Bundespost). The Law concerning the restructuring of Posts and Telecommunications was adopted as early as 1989, and this new law created new regulatory provisions for opening up broader competitive opportunities on the telecommunications markets. With the Telecommunications act of 1996, the monopoly on both network and telephony was also finally abolished and these markets were hence fully liberalised.
Today’s development goes hand in hand with the population’s increasing demand for mobile communication services. not least because of the new technical possibilities opened up by, inter alia, UmTS demand for more bandwidth will continue to rise in line with increasing mobility. Both growing demand and technological innovation call for the availability of adequate frequency spectrum.
Because of its type of use and the current state of technology, the frequency spectrum available is still considered a scarce resource. according to the regulatory authority, the regulatory authority for Telecommunications and Posts (‘the regTP’), use of frequencies needs a forward-looking, non-discriminatory and proactive frequency regulation. The ‘Digital Dividend’ is the frequently used term whenever digitisation results in the freeing up of spectrum.
ii Flexible spectrum use
The newly amended Telecommunications act announced in march 2010 takes account of the guidelines laid out by the european Directives (‘Better regulation’ and ‘Citizens rights’) and incorporate them into national German law. The amendment ensures the alignment of decision-making policy of the Federal network agency on competition and investment-friendly regulatory principles. Providing security for potential investors, the Federal network agency will be empowered to provide fundamental regulatory concepts at an early stage and to make binding preliminary specifications in regard to possible regulatory decisions. also, the Federal network agency too can specify the sharing of land and installed facilities. moreover, additional reporting requirements about infrastructural facilities are planned, the aim being to create a comprehensive list according to their nature, availability and geographical location, and to improve cooperation and ‘spectrum sharing’.
Spectrum use should be more efficient and flexible. Tighter sanctions should lead spectrum to be actually used instead of merely maintained. at the same time, portability, trade, leasing and sharing of spectrum will be designed more openly.
iii Broadband and next-generation mobile spectrum use
Some rural areas of Germany still lack high-speed Internet connections (‘white areas’) and suffer substantial economic disadvantage as a result. as cable installation in those regions is not considered economical, using the spectrum resources made available through digitisation and providing Internet coverage via wireless broadband has become the main objective of the relevant German authorities. Thus, the Federal network
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agency imposed rather strict requirements on the auction purchase of spectrum in 2010. adequate Internet access has to be supplied ‘level-wise’: thus every successful bidder has had to agree to provide Internet access to communities and cities with no more than 5,000 inhabitants, to those with between 5,000 and 20,000 inhabitants and then to cities with more than 50,000 inhabitants. Further expansion of Internet services will not be allowed before supply to 90 per cent of any ‘level’ has been ensured.
iv Spectrum auctions and fees
Germany held europe’s first 4G mobile broadband spectrum (radio airwave) auction from mid-april to mid-may 2010. The Federal network agency was in charge of the auction, which was the first wireless broadband spectrum auction in Germany for nearly a decade. Four operators23 were allowed to bid for frequencies from the fields at 800mHz, 1.8GHz, 2GHz and 2.6GHz amounting to approximately 360mHz; no new entrants were allowed to bid. The minimum bid price was set at €1.5 million per 5mHz frequency block. after 224 auctions on 27 days in total the auction aggregated a total amount of €4.4 billion for 41 frequency blocks.
v YeAr IN revIew
In the past 18 months, some important court decisions were rendered and legislative changes passed regarding Internet and multimedia law. The great number of judgments and essays published so far in 2011 represent an exciting development in this dynamic legal area in Germany.
IT contract law has been most influenced by the contractual framework conditions of cloud computing, which has still lots of loopholes. experts predict annual growth rates of more than 40 per cent and the federal government recognised this potential and launched the ‘trusted cloud’ technology programme in cooperation with the private sector.24
In the field of liability on the Internet, fundamental judgments have been issued about search engines and about individuals running unsecured wireless Lan connections. The copyright question about the legality of the use of on-demand streaming offers is still discussed a great deal.
The area of media law saw with the judgments of the eCJ about Internet gambling25 and data protection law focused on the social networks and especially Facebook’s ‘like’ button, which constantly communicates with Facebook and most likely transfers personal
23 Telefonica O2 Germany GmbH & Co OHG, Deutsche Telekom GmbH, Vodaphone D2 GmbH and erste mVV mobilfunk Vermögensverwaltungs-gesellschaft mbH (e-plus).
24 www.bmwi.de/english/navigation/Press/press-releases,did=383292.html.25 In various decisions on September 8, 2010, the eCJ judged that the German monopoly
for lottery and sports betting breaches against the european freedom of establishment and services.
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data from non-Facebook-members, even if they have not used the button.26 The question of how to deal with a new data retention law was afforded lots of attention.27
vI CONCLUSIONS ANd OUTLOOK
Convergence presents an abundance of challenges for policy-makers, industry and society. Cooperation on a european and global level is vital for most German ICT policy issues, including telecommunication and frequency policies, ICT research, anti-spam measures and consumer, copyright and youth protection in the context of new media. Indeed, it is impossible to separate these international activities from national policymaking.
The German parliament has established a committee of inquiry on the topic ‘Internet and the digital society’. The aim of this committee is to work out a legal framework by 2012 designed for the digital society. The framework needs to be flexible enough to tackle the long-term consequences for German society, the economy and the law driven by the ever-increasing Internet penetration. The most relevant topics will be net neutrality, data protection, copyright protection, green IT, net anonymity, e-government and legal security in electronic commerce. The working parties on media literacy and copyright have already finished their work and it has been announced that their reports will be released in the third quarter of 2011. In addition to that, the incorporation of the eU Telecoms Package into German law is eagerly awaited.
26 See also the decision of the superior Court of Justice of Berlin (Kammergericht), MMR 2011, 464, which sees no violation of competition law by using the ‘like’ button of Facebook.
27 Gola and Klug, NJW 2011, 2484 (2485).
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About the Authors
Zahra rahvarLatham & Watkins LLPZahra rahvar is an associate in the hamburg office of Latham & Watkins LLP, practising in the firm’s corporate department. she is a graduate of bucerius Law school in hamburg and has been a scholar of the German National Academic Foundation. Dr rahvar wrote her doctoral dissertation on the topic of press freedom under the influence of media convergence. During her legal studies, she worked as a research associate at the Chair of Public Law and Comparative Law under Professor Michael Fehling, mainly in the field of media, environmental and administrative law, and also spent a fair amount of time abroad as an exchange student at, inter alia, Yale university, Minnesota school of Law and Paris II, under the tulane Law school summer programme.
LaThaM & WaTKINS LLPWarburgstrasse 5020354 hamburgGermanytel: +49 40 4140 30Fax: +49 40 4140 [email protected]
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