National Regulatory Agency for Electronic Communications and Information Technology of the Republic of Moldova

The National Regulatory Agency for Electronic Communications and Information Technology (ANRCETI – www.anrceti.md) designated JSC „Moldtelecom” as a provider with significant market power on two wholesale markets: the market for provision of terminal segments (market no.6) and the market for provision of trunk segments (market no. 8) of leased lines, regardless of the technology used for the provision of leased or reserved capacity. The Administrative Board Decisions were approved in a public session on September 15, and became effective on the same day. This week they are to be published in the Official Gazette.

Relevant market no.6 includes all types of transmission links (dedicated copper lines, optical fiber, radio etc.), all types of technologies, interfaces and protocols used. Market no.8 includes transmission capacity services with interfaces: SDH, MPLS, Ethernet, WDM and services of access to optical fiber. The regulator identified these markets as susceptible to ex-ante regulation and made them subject to detailed analysis, which proved lack of competition and existence of significant market power of the incumbent on both markets.

According to the market analysis, JSC „Moldtelecom” holds 99,6% of market no.6 in terms number of provided leased line circuits, and 100% of market no.8 in terms of leased trunk segment circuits. The authors of the analysis identified the competition problems on the two markets, the risks of market distortion as a result of the significant market power used by the incumbent, as well as the obligations to be imposed on this provider in order to prevent eventual abuse to the detriment of competition.

The main obligations the regulator intends to impose on JSC „Moldtelecom” are: non-discriminatory provision of leased lines to all requesting providers; ensuring the transparency of prices, conditions of service provision, maintenance, service quality, additional services supplied, cost orientation (LRIC) of prices for wholesale provision of leased line terminal and trunk segments and associated services; separate accounting publication of separate accounting reports.

ANRCETI submitted its Decisions to JSC „Moldtelecom” and the National Competition Protection Agency. The latter has to include JSC „Moldtelecom”, within 10 days, into the list of economic entities with significant market power on relevant electronic communications markets. According to the legislation in force, upon 10 days expiry, ANRCETI has the right to adopt decisions imposing special ex-ante obligations on JSC „Moldtelecom” as an SMP provider on the mentioned markets.

Markets no.6 and no.8 are two of the total of 10 markets, which are to be subject to analysis to determine the level of competition and the need for ex-ante regulation, all this pursuant to the Law on Electronic Communications. To date, ANRCETI reviewed 9 relevant markets and find significant market power of the incumbent JSC „Moldtelecom” on all of them.

September 19, 2011