Pursuant to Article 85 (3) of the EC Treaty and Article 53 (3) of the EEA Agreement, the provisions of Article 85 (1) of the EC Treaty and Article 53 (1) of the EEA Agreement are hereby declared inapplicable for the period of validity of the Unisource Decision to:
(1) the Uniworld joint venture as notified to the Commission, including the ancillary obligations regarding (i) the relationship between Uniworld and its parent companies concerning purchasing by Uniworld or supply to it under Article 10 of the Joint Venture Agreement and (ii) the non-competition provision under Article 12 of the Joint Venture Agreement;
(2) the exclusive distribution arrangements in respect of the countries of the shareholders of Unisource.
The exemption from the application of Article 85 (1) of the EC Treaty and Article 53 (1) of the EEA Agreement set out in Article 1 of this Decision shall be subject to the following conditions:
(1) Non-discrimination
(a) Every shareholder of Unisource and Unisource itself shall undertake that neither it nor any of its subsidiaries will offer terms and conditions to Uniworld in respect of interconnection to the PSTN, ISDN and PSDN networks as well as leased lines in the home countries of the Unisource shareholders which are discriminatory in favour of Uniworld.
(b) Every shareholder of Unisource shall undertake that all dealings with (i) AT& T and (ii) any other shareholder in respect of correspondent bilateral traffic will be on terms and conditions similar to those offered to third parties in connection with reserved facilities and services and with such facilities and services in respect of which they still have a dominant position after full and effective liberalization of telecommunications infrastructure and services in each of their respective countries.
(2) No misuse of confidential information
Unisource and every one of its shareholders shall undertake not to misuse confidential information obtained from third parties to the benefit of Uniworld and will, in relation to Uniworld, ensure and facilitate the respect of the undertakings related to misuse of confidential information given in the context of the Unisource Decision.
(3) Prevention of cross-subsidization
Every shareholder of Unisource shall undertake not to grant any cross-subsidies to any entity created pursuant to the Uniworld agreements funded out of income generated by any business which they operate pursuant to any exclusive right or in respect of which they hold a dominant position.
(4) Prevention of tying
Every shareholder of Unisource shall undertake that it will not tie in the sale of any service provided by Uniworld with any service provided by each of them. Each will, moreover, for as long as it has a dominant position in respect of the provision of telecommunications services and/or infrastructures, only make combined offerings of Uniworld services and its own services in such a way that the customer can identify in the contract forms the price charged as well as the other terms and conditions for these services and it will ensure that each of these components is separately available at equivalent conditions.
Breaches of the requirements set out in points 1 to 4 shall not be considered to violate the conditions set out in this Article unless such breaches have a substantial impact on the market.
This Decision shall be subject to the following obligations:
(1) Auditing
All entities created under the Uniworld transaction shall be audited every year and that audit shall confirm from an accounting viewpoint that:
(a) the transactions between these entities, on the one hand, and the shareholders of Unisource, on the other hand, have been conducted at arm's length;
(b) the figures are accurate.
The first auditing reports, covering the calendar year 1997, shall be submitted to the Commission within six months after the end of 1997.
(2) Recording obligations
All shareholders of Unisource and all entities created pursuant to the Uniworld agreements shall each keep records and documents suitable to prove compliance with the terms of the conditions set out in Article 2 ready for inspection by the Commission.
(3) Inspection of records
For the purpose of ascertaining and ensuring compliance by the shareholders of Unisource or by Unisource itself with the conditions set out in Article 2, each of the shareholders and all entities created pursuant to the Uniworld agreements shall, on reasonable notice, during office hours, and without the need for the Commission to invoke the powers of inspection pursuant to Regulation No 17, give the Commission access to business premises to inspect records and documents covered by the above recording obligations and to receive oral explanations relating to such documents.
(4) Reporting obligations
All shareholders and all entities created pursuant to the Uniworld agreements shall provide to the Commission, for the purpose of determining whether they comply with the obligations set out in points (1), (2) and (3):
(a) any records and documents in the possession or control of the shareholders or any entity created pursuant to the Uniworld agreements necessary for that determination every six months, starting one year after the date of the exemption pursuant to Article 1; and
(b) oral or written complementary explanations.
This Decision is addressed to:
Unisource NV,
Transpolis,
Polarisavenue, 97,
PO Box 2042,
NL-2132 JH Hoofddorp.
AT& T SA/NV,
1945, ChaussΓ©e de Wavre,
B-1160 Brussels.
Done at Brussels, 29 October 1997.
For the Commission
Karel VAN MIERT
Member of the Commission
(1) OJ 13, 21. 2. 1962, p. 204/62.
(2) OJ C 44, 12. 2. 1997, p. 4.
(3) Unisource Pan-European Services and AT& T Pan-European Services have been created as special subsidiaries to hold the respective interests of the parent companies in Uniworld VOF.
(4) See p. 1 of this Official Journal.
(5) By order released on 23 October 1995, the FCC reclassified AT& T as a non-dominant carrier in the market for interstate (US domestic) telecommunications services.
(6a) Deleted, business secrets.
(7) WorldPartners is a limited partnership promoted by AT& T basically to set performance standards, agreed and respected by the members of the partnership, in respect of given telecommunications services. Such standards are a way to extend connectivity for those services outside the borders of each of its members. Members of the WorldPartners Company have invested in it and participate, among other things, in the definition of the standards. Members of the WorldPartners Association are distributors of the services in given territories. The agreements regarding Unisource and AT& T UK's entry into WorldPartners have been separately notified to the Commission (Case No IV/35.490 - WorldPartners).
(8) The WorldPartners portfolio of WorldSource services is limited to the offering of virtual network services (VNS), Frame Relay and private lines. For each of these, a common denominator of features is defined. That common denominator is to be provided by each WorldPartner's member or associate. Services complying with the common denominator can bear the WorldSource trademark.
(9) Seamlessness is defined as a cohesive and homogeneous approach to the service from a user's perspective. The customer thus does not see the underlying complexities of providing the service.
(10) The term 'multilateral` encompasses both foreign-to-foreign and home-to/from-foreign telecommunications traffic. By contrast, 'bilateral` services are not able to encompass directly foreign-to-foreign telecommunications traffic. In addition, in a IVPN service offered on the basis of bilateral agreements concluded with foreign telecommunication operators, the features of calls terminating in the territory of the provider of the service are controlled by whatever features are available on the other country. So, it is possible that not all the features provided within the territory of the provider are available in respect of traffic to the outside.
(11) The Netherlands, Sweden and Switzerland.
(12) In this respect, according to the parties, a customer receiving international and national services from a distributor of Uniworld will clearly perceive that he is receiving two different kinds of services.
(13) 'Preferred` means that Uniworld will be free to contract with other suppliers if the demanded services are outside the scope of UCS or if UCS does not or cannot compete with the terms and conditions of other suppliers.
(14) The following are examples of exclusive services: virtual network services - VNS/IVPN/closed user group voice services - X.25 bearer service, frame relay service, managed bandwidth service and X.400 bearer service. Examples of non-exclusive services are: call centre services, LAN interconnect services, messaging services, VSAT satellite services, network related outsourcing, network facilities management, private network provisioning, Internet access services and data VPN services.
(15) Under Article 16.3.1 neither parent company of Uniworld may terminate the agreement before 1 January 2000. Most terminations before that date, in particular in case of material breach of the agreement, non-permitted transfers of shares or withdrawal, bankruptcy or suspension of payments by a party, are deemed to be non-permitted exits.
(16) The same rule will be applied in respect of the attribution of existing customer contracts.
(17) This market definition is consistent with that adopted by the Commission in the BT-MCI case (Commission Decision 94/579/EC, OJ L 223, 27. 8. 1994, p. 36, at point 5), as well as in the Atlas and Global One cases (Commission Decisions 96/546/EC and 96/547/EC, OJ L 239, 19. 9. 1996, p. 23, at points 4 to 15, and p. 57, at points 5 to 16 respectively).
(18) That service is basically the same Phase II service jointly developed by Unisource and AT& T in the framework of the European Virtual Private Network Users Association (EVUA) bid.
(19) It also offers more features (than the minimum common denominator) but less geographical coverage (limited to Europe), than the WorldSource VNS service that Unisource and AT& T UK are beginning to distribute in continental Europe and the United Kingdom respectively.
(20) See footnote 9 above for a definition of the term.
(21) Virtual Private Networks were developed so that telecommunications operators could offer the corporate user the functionality of a physical private network without having to invest in leased lines. A portion of a public network is reserved for the customer who uses it as if it were a separate one.
(22) Local Area Network.
(23) The EVUA has issued in 1996 a new tender for integrated voice/data services.
(24) Service applications will include reservation centres, customers service support centres and maintenance and warranty support centres. These services require European-wide free phone numbers (0800).
(25) That definition is consistent with the cross-border regional market defined in the Atlas Decision (at point 12) (see footnote 16) and in the Unisource Decision (at point 30).
(26) See footnote 2.
(27) See footnote 13.
(28) In both cases through its shareholders.
(29) Unisource has 45 % market share in the Netherlands, 25 % in Sweden, 20 % in Switzerland and markets shares below 5 % in Portugal, Finland and Denmark. Market presence in the other countries of the EEA is below 1 %. As for AT& T, it has 10 % in the United Kingdom and below 1 % in the rest of the EEA.
(30) At paragraph 39 of the Guidelines.
(31) Independent sources point to the importance of creative packaging of base services (which everyone can offer) into new value added services as a source of competitive advantage.
(32) See Decision 96/546/EC (Atlas), at point 58 (see footnote 16).
(33) At points 39 to 71.
