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1 Summary notification form relating to a draft decision of the commission of the Inde pendent Post and Telecommunications Authority in the Netherlands with respect to the relevant markets for terminating segments of leased lines on a wholesale level (market 13).

This summary notification form relates to a draft decision of the commission of the Independent Post and Telecommunications Authority in the Netherlands (hereafter: the commission) with respect to the relevant markets for terminating segments of leased lines on a wholesale level.(market 13).

In accordance with article 6b.2 of the Telecommunications Act the commission notifies draft measures which would affect trade between Member States to the Commission of the European Communities and to the national regulatory authorities. The commission gives both to the Commission of the European

Communities and to the national regulatory authorities the opportunity to make comments to the draft measure.

Comments to this draft measure are due to be sent to Mr. G.C. Boogert at Huurlijnen-MA@opta.nl by 4 December 2005.

The Hague, 4 November 2005

PO Box 90420 2509 LK The Hague Telephone +31 70 315 35 00 Telefax +31 70 315 35 01

Visiting address:

Zurichtoren Muzenstraat 41 2511 WB The Hague The Netherlands

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2 Section 1

Market definition

1.1 The affected relevant product/service market.

The relevant product market consists of the market for

- wholesale terminating connections of <2Mbit/s; (see chapter 8) - wholesale terminating connections of 2Mbit/s; and (see chapter 8)

- wholesale terminating connections of >2Mbit/s. (see chapter 8 and paragraph 21.3)

1.2 The affected relevant geographic market.

The relevant geographic market for the terminating segments of leased lines on a wholesale level is the Netherlands.

1.3 Summary of the opinion of the Netherlands Competition Authority

The Netherlands Competition Authority (NMa) agrees with the conclusions drawn by the commission, as confirmed in a letter to the commission dated 15 June 2005 (included in Annex H).

1.4 Overview of the results of the public consultation to date on the proposed market definition

See separate chapter 21, ‘Consultatie ontwerpbesluit huurlijnen’. The public consultation has not given the commission cause to make material chang es in the proposed market definition.

1.5 Differences with the Commission Recommendation on relevant markets

None.

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3 Section 2

Designation of undertakings with significant market power

2.1 Name(s) of the undertaking(s) designated as having individually or jointly significant market power or where applicable, the name(s) of the undertaking(s) which is (are) considered to no longer have significant market power.

Koninklijke KPN N.V. and her group entities (hereafter: KPN) is considered to have significant market power on the following relevant markets:

- wholesale terminating connections of <2Mbit/s; (see paragraph 10.2)

- wholesale terminating connections of 2Mbit/s; and (see paragraph 10.1 and paragraph 21.4) - wholesale terminating connections of >2Mbit/s. (see paragraph 10.3 and paragraph 21.3)

2.2 Criteria relied upon for deciding to designate or not an undertaking as having individually or jointly with others significant market power.

The criteria relied upon are:

For the relevant market wholesale termi nating connections of <2Mbit/s:

- market share;

- network coverage advantages;

- cost advantages related to economies of scale and scope;

- diversification advantages;

- network cannot be easily duplicated; and - barriers to entry.

For the relevant market wholesale terminating connections of 2Mbit/s:

- market share;

- network coverage advantages;

- cost advantages related to economies of scale and scope;

- diversification advantages;

- network cannot be easily duplicated; and - barriers to entry.

For the relevant market wholesale terminating connections of >2Mbit/s:

- market share;

- no network coverage advantages;

- no cost advantages related to economies of scale and only limited cost advantages related to economies of scope;

- diversification advantages;

- network can be (and has been) easily duplicated; and - low barriers to entry.

2.3 Name of the main undertakings (competitors) present / active in the relevant market.

The main undertakings for the respective relevant market are for:

- wholesale terminating connections of <2Mbit/s: KPN

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4 - wholesale terminating connections of 2Mbit/s: KPN, BT, Colt, and Priority Telecom

- wholesale terminating connections of >2Mbit/s: KPN, BT and Priority Telecom

2.4 Market shares of the undertakings mentioned above and the basis of their calculation (e.g., turnover, number of subscribers).

These market shares are based on the total turnover for the year 2003 and an estimate provided by all provider for the year 2004. The market shares within the respective relevant markets are for:

- wholesale terminating connections of <2Mbit/s: KPN [95-99%]

- wholesale terminating connections of 2Mbit/s: KPN [50-60%], BT [5-10%], Colt [5-10%], Priority Telecom [5-10%].

- wholesale terminating connections of >2Mbit/s: KPN [40-50%], BT [10-20%], Priority Telecom [10-20%]

2.5 Summary of the opinion of the national competition authority where provided.

The Netherlands Competition Authority agrees with the conclusions drawn by the commission, as confirmed in a letter to the commission dated 15 June 2005 (included in Annex H).

2.6 Summary of the results of the public consultation to date on the proposed designation(s) as undertaking(s) having significant market power (e.g., total number of comments received, numbers agreeing/disagreeing).

See separate chapter 21, ‘Consultatie ontwerpbesluit huurlijnen’. The public consultation has given the commission cause to make material changes in the conclusions regarding undertakings with significant market power.

KPN is now considered to also have significant market power on the market for wholesale terminating connections of >2Mbit/s.

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5 Section 3

Regulatory obligations

3.1 Legal basis for the obligations to be imposed, maintained, amended or withdrawn

The commission imposes the following obligations for wholesale terminating connections of <2Mbit/s and 2Mbit/s

- Access, based on article 6a.6 (1) of the Telecommunications Act;

- Non discrimination, based on article 6a.8 of the Telecommunications Act;

- Reference offer, based on article 6a.9 (2) of the Telecommunications Act;

- Tariff regulation, based on article 6a.7 of the Telecommunications Act;

- Separated accounting, based on article 6a.10 of the Telecommunications Act.

The commission imposes the following obligation for wholesale terminating connections of >2Mbit/s - Access, based on article 6a.6 (3) of the Telecommunications Act;

3.2 Reasons for the imposition, maintenance or amendment of the obligations

The obligations are imposed to prevent/counteract potential competitive problems:

- excessive tariffs to the detriment of end users, in particular fixed end users;

3.3 Exceptional measures

Not applicable.

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6 Section 4

Compliance with International obligations

4.1 Imposition, amendment or withdrawal of obligations provided for in Article 8(5) of Directive 2002/19/EC (Access Directive)

Not applicable.

4.2 Name(s) of the undertaking(s) concerned

Not applicable.

4.3 International commitments entered by the Community and its Member States that need to be respected.

Not applicable.

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