REGISTRATION DOCUMENT AND FINANCIAL REPORT - Iliad

6. OVERVIEW OF THE GROUP’S BUSINESS
6.6 REGULATORY SITUATION
• With respect to the market for call origination in mobile networks, ARCEP suspended its analysis for a
period of 12 months in May 2005 in agreement with the European Commission. The analysis will be
resumed once ARCEP has had time to reflect on the effects of the Mobile Virtual Network Operator
(MVNO) contracts concluded by two GSM operators in mainland France with various companies involved
in MVNO services (including TELE2, M6 and NRJ), and when it has examined the applications submitted
following the tender process concerning France’s fourth UMTS mobile license, to be launched by the
Minister responsible for electronic communications.
• Retail fixed telephony markets are no longer regulated ex-ante by ARCEP. Where an abuse of dominant
position is presumed to exist, they will be examined ex-post by the Conseil de la concurrence.
The regulatory measures that can be imposed by ARCEP on operators designated as having significant market
power in a relevant market are specified in Articles L.38 (wholesale markets) and L.38-1 (retail markets) of the
Post and Electronic Communications Code. These measures include obligations to publish detailed technical and
pricing specifications relating to interconnection and access, to provide interconnection or access services under
non-discriminatory conditions, not to charge excessive or predatory prices on the market in question and to
charge prices which are oriented towards the corresponding costs, to account separately for certain activities, to
provide retail services under non-discriminatory conditions, not to unreasonably bundle these services, to comply
with the price cap mechanism set by ARCEP over a number of years, and to obtain ARCEP’s approval of prices
prior to their application.
The business activities of each of the operators in the various markets will be affected as ARCEP’s decisions
based on its analysis of the markets take effect. In particular, those operators designated as having significant
market power in a relevant market could experience a reduction in the profitability of their business activities in
the market in question. Iliad does not, however, believe that ARCEP’s decisions will have any significant effect
on the markets in which it is active.
Operation of a public telecommunications network/Provision of a public telephone service
Following the enactment of Law 2004-669 and the amendment of Article L.33-1 of the Post and Electronic
Communications Code, potential operators need only notify ARCEP of their intention to engage in this line of
business (except for the allocation of frequencies or numbering resources which still require a prior individual
authorization). Law 2004-669 also specifies that existing authorizations are deemed to be a notification within
the meaning of the 2002 Telecoms Package, in accordance with the principles laid down in Article 17 of the
Authorization Directive.
In accordance with these provisions, the Group’s companies have been registered with ARCEP and ARCEP has
provided them with a receipt allowing them to exercise their rights.
Operators that have submitted notifications in accordance with Article L.33-1 of the Post and Electronic
Communications Code may benefit from rights of way in consideration for the payment of a fee, in order to
establish their network infrastructure on public highway land or other public property and, under certain
conditions, may be provided with easements concerning private property. The Group benefits from these rights
and has developed its network infrastructure mainly on public property.
All authorized operators must pay the annual fees and taxes, including fees for the management and control of
their authorizations, as well as for the numbers or frequencies allocated to them. In addition, all operators are
required to contribute to universal service funding (see below).
Use of radio-electric frequencies
The use of scarce resources – such as radio-electric frequencies, is subject to prior approval by ARCEP.
ARCEP generally allocates frequency resources on request. However, when a particular resource is scarce it
organizes a tender process which is approved by the Minister responsible for electronic communications.
48 - Iliad – Registration Document 2007