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ANCOM’s Reduction of Termination Rates Agreed by the European Commission, to Apply in Romania from 1 April 2014

27.02.2014
 
Following the favourable opinion of the European Commission, the Romanian National Authority for Management and Regulation in Communications (ANCOM) adopted the decisions setting the new maximum tariffs for the interconnection services for the purpose of call termination. From 1 April 2014, the maximum termination rates in Romania will decrease from 0.67 eurocents/minute to 0.14 eurocents/minute for fixed call termination and, respectively, from 3.07 eurocents/minute to 0.96 eurocents/minute for mobile call termination.
Upon finalisation of the national public consultation on the cost calculation models for determining the interconnection rates in the second half of 2013, ANCOM has notified the European Commission, BEREC and the national regulatory authorities from the other EU Member States on the application of the new maximum tariffs. The agreement received from the European Commission pursuant to the Framework-Directive concludes the European consultation and allows ANCOM to adopt the proposed set of measures.
“The European Commission welcomed the pure LRIC tariffs for call termination calculated by ANCOM and observed that these contribute to a level playing field among operators and ensure that all users derive maximum benefits in terms of choice, price and quality. I am glad to have successfully concluded one of our most complex projects and I am looking forward to the internalisation of the benefits of these long-awaited measures by innovation and the launch of more competitive retail offers, to the benefit of all users”, the president of ANCOM, Mr Catalin Marinescu, said. 
The regulatory measures that ANCOM has adopted on the wholesale markets for call termination are a result of the steps initiated by the Authority in 2012 and continued in 2013, which involved complex works of data collection, analysis and elaboration of various scenarios, as well as successive series of consultations and adjustments. ANCOM has calculated the efficient costs of service provision using working hypotheses in line with the Romanian legislation, information submitted by the network providers, as well as the best modelling practices at the European Union level.
The new tariffs will become mandatory for all the network providers in Romania, identified as having significant power on the markets of fixed and mobile call termination: 46 providers of fixed networks and 6 providers of mobile networks. As until now, the termination rates are not differentiated by the technology used to deliver the call (e.g. 2G or 3G, PSTN or IP), by the time of day when the calls are made or by their origin (fixed locations, mobile locations, national or international networks).
ANCOM has also set new tariff ceilings for the ancillary interconnection services offered by all the providers of communications networks and, respectively, for the national call transit services, leased lines-terminating segments services and backhaul Ethernet services supplied by Romtelecom.

The termination rate is exclusively billed in the case of off-net calls and represents the cost required by the terminating network for the delivery of the call. Since this fee is included in the tariff charged to the calling user, termination rates that are excessive as compared to the costs of efficient service provision may negatively affect the retail competition and distort the users’ consumption behaviour. In order to prevent such competition problems, ANCOM has decided to adopt regulatory measures to lower the maximum termination rates operators charge, down to levels that realistically reflect the true costs of the services and the competitiveness of the Romanian operators.

ANCOM’s Reduction of Termination Rates Agreed by the European Commission, to Apply in Romania from 1 April 2014

27.02.2014
 
Following the favourable opinion of the European Commission, the Romanian National Authority for Management and Regulation in Communications (ANCOM) adopted the decisions setting the new maximum tariffs for the interconnection services for the purpose of call termination. From 1 April 2014, the maximum termination rates in Romania will decrease from 0.67 eurocents/minute to 0.14 eurocents/minute for fixed call termination and, respectively, from 3.07 eurocents/minute to 0.96 eurocents/minute for mobile call termination.
Upon finalisation of the national public consultation on the cost calculation models for determining the interconnection rates in the second half of 2013, ANCOM has notified the European Commission, BEREC and the national regulatory authorities from the other EU Member States on the application of the new maximum tariffs. The agreement received from the European Commission pursuant to the Framework-Directive concludes the European consultation and allows ANCOM to adopt the proposed set of measures.
“The European Commission welcomed the pure LRIC tariffs for call termination calculated by ANCOM and observed that these contribute to a level playing field among operators and ensure that all users derive maximum benefits in terms of choice, price and quality. I am glad to have successfully concluded one of our most complex projects and I am looking forward to the internalisation of the benefits of these long-awaited measures by innovation and the launch of more competitive retail offers, to the benefit of all users”, the president of ANCOM, Mr Catalin Marinescu, said. 
The regulatory measures that ANCOM has adopted on the wholesale markets for call termination are a result of the steps initiated by the Authority in 2012 and continued in 2013, which involved complex works of data collection, analysis and elaboration of various scenarios, as well as successive series of consultations and adjustments. ANCOM has calculated the efficient costs of service provision using working hypotheses in line with the Romanian legislation, information submitted by the network providers, as well as the best modelling practices at the European Union level.
The new tariffs will become mandatory for all the network providers in Romania, identified as having significant power on the markets of fixed and mobile call termination: 46 providers of fixed networks and 6 providers of mobile networks. As until now, the termination rates are not differentiated by the technology used to deliver the call (e.g. 2G or 3G, PSTN or IP), by the time of day when the calls are made or by their origin (fixed locations, mobile locations, national or international networks).
ANCOM has also set new tariff ceilings for the ancillary interconnection services offered by all the providers of communications networks and, respectively, for the national call transit services, leased lines-terminating segments services and backhaul Ethernet services supplied by Romtelecom.

The termination rate is exclusively billed in the case of off-net calls and represents the cost required by the terminating network for the delivery of the call. Since this fee is included in the tariff charged to the calling user, termination rates that are excessive as compared to the costs of efficient service provision may negatively affect the retail competition and distort the users’ consumption behaviour. In order to prevent such competition problems, ANCOM has decided to adopt regulatory measures to lower the maximum termination rates operators charge, down to levels that realistically reflect the true costs of the services and the competitiveness of the Romanian operators.

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