Amendments to legislation on communications, clarifying procedural requirements for connection of and cooperation between telecommunications networks

Pepeliaev Group notes: On 26 January 2011, the Russian State Duma passed the first reading of the Draft Law “On amending article 19 of the Federal Law ‘On telecommunications’” (the “Draft Law”). The Draft Law clarifies the procedural requirements for connecting communications networks and for them to cooperate with an operator which occupies a significant position in a general use telecommunications network. 

The explanatory note states that the Draft Law has been created with a view to eliminating the discrepancies between the regulations contained in civil law and those in legislation relating to telecommunications, in particular the provisions of article 426 of the Russian Civil Code, which relate to a public agreement, being applied to agreements on connecting to a telecommunications network.

As things stand, the defective drafting of article 19 of the Law on telecommunications has resulted in that provision being applied in different ways in practice.

Under clause 1 of article 19 of the Law, the provisions on a public agreement apply to an agreement on connecting telecommunications networks which lays down the terms on which connection services are provided and related obligations as to the cooperation of the telecommunications networks and the admittance of traffic with regard to operators which occupy a significant position in a general use telecommunications network. The consumer of connection and traffic admittance services is the operator of the general use telecommunications network.

So as to ensure that there is non-discriminatory access to a market for telecommunications services in similar circumstances, an operator occupying a significant position in a general use telecommunications network is obliged to establish the same terms for connecting to telecommunications networks and admitting traffic for operators providing the same services. It must also supply information and provide such telecommunications operators with connection services and services for admitting traffic on the same terms and of the same quality as it provides to its own in-house units and/or its affiliates.

In practice, as a rule, operators connecting to a telecommunications network start performing traffic admittance services for each other. At the same time, this creates uncertainty as to whether the provisions on a public agreement apply in their entirety or only to the extent that an operator which occupies a significant position in a general use telecommunications network is involved. In other words, is the agreement in question ‘public’ for both an operator which occupies a significant position in a general use telecommunications network and also for any operator of a general use telecommunications network, or only for the former?

Judicial practice on this issue is also inconsistent. There is a whole series of judicial decisions in support of the view that an agreement on the connection of a telecommunications network is public for all telecommunications operators (for example, the following Resolutions of various Federal Arbitration Courts (FACs): Resolution No. KG-A41/13768-07 of the FAC for the Moscow Circuit dated 21 January 2008; the Resolution of the FAC for the Volga Circuit dated 2 August 2010 in Case No. A06-7430/2009 and the Resolution of the FAC for the Volga-Vyatka Circuit dated 19 August 2010 in Case No. A82-16259/2009). Equally, other courts have taken the stance that such an agreement is only public for operators which occupy a significant position in a general use telecommunications network (for example, the Resolution of the FAC for the Volga Circuit dated 20 November 2007 in Case No. A12-19968/2006-S25-5/11 and the Resolution of the FAC for the Volga-Vyatka Circuit dated 31 July 2008 in Case No. A82-5975/2007-35).

The Draft Law sets out to eliminate this inconsistency by establishing a single interpretation of article 19 of the Law on telecommunications. Under this interpretation, the provisions on a public agreement will apply exclusively to connection services and admittance of traffic services performed by operators which occupy a significant position in a general use telecommunications network.

The proponents of the Draft Law argue that it will, if adopted, enhance the development of competition on the market for telecommunications services and will help to reduce the fees users pay for such services. This is because operators who conclude agreements on connecting telecommunications networks with operators which occupy significant position in a general use telecommunications network will be able to specify their own terms for providing the services in such connection agreements.

The Draft Law is currently being considered by the State Duma’s Information Policy, Information Technology and Telecommunications Committee and will be developed further taking account of the comments set out in the Russian Government’s official comments.

For further information, please contact:

Natalya Ivashchenko, Head of group "Telecommunications", at: (495) 967-0007 or by e-mail