I. Facts

a.  Application presented by DSTelecom Norte, S.A.

1. By application¹ presented on 28.03.2013, DSTelecom Norte, S.A. (hereinafter DST) requested, under article 10 of the Electronic Communications Law (Law No. 5/2004, of 10 February, as amended and republished by Law No. 51/2011, of 13 September - ECL) and paragraph 3 of article 19 of Decree-Law No. 123/2009 of 21 May, as amended and republished by Decree-Law No. 258/2009², of 25 September, and Law No. 47/2013, of 10 July³ (hereinafter DL 123/2009), the intervention of ANACOM in the scope of its dispute with Associação de Municípios da Terra Quente Transmontana (hereinafter AMTQT).

In short, DST claims that:

On 08.05.2012, it applied to AMTQT for access to pipelines of the community broadband network held by that association (Community Broadband Network held by Terra Quente Transmontana, hereinafter CBNTQT) for the purpose of the deployment of fibre optic, for a minimum period of 20 years.

On 16.05.2012, DST was informed by letter  sent by AMTQT that the request for access had been approved.

In parallel with the approval of the request for access, AMTQT required, for the use of pipelines, the payment of the following remuneration: €3,10/m⁴ in the backbone and €3,76/m in local networks, the full price for a minimum period of 20 years being due when pipelines are first used⁵.

DST did not agree with conditions presented by AMTQT, both as regards the amounts required and the payment of the full price for the 20 years of use of infrastructures, having made AMTQT aware of its disagreement⁶.

On 20.07.2012, after a period of stalemate, a meeting between AMTQT and DST was held, having the Association been open to analyse the situation. It was agreed that DST would suggest a set of economical remuneration models, which it did and submitted to AMTQT by email sent on 26.07.2012.

On 27.09.2012, AMTQT presented a counter-proposal, and the parties pursued further the negotiation of values and conditions.

On 08.10.2012, DST decided to accept the commercial conditions presented by AMTQT, having recognised the need to solve the stalemate, notwithstanding the fact that some of the aspects involved were deemed not to be appropriate in the light of market practise.

According to the letter sent by DST to AMTQT, commercial conditions indicated by the Association, and accepted on that date, concerned remuneration due for the use of pipelines during the period of useful life, estimated to be a 20-year period, manholes included, and which were as follows: €3.10/m in the backbone; €3.76/m in local networks.

On 23.10.2012, AMTQT replied, imposing the following conditions for payment:

- 50% of the overall amount at the time of the signature of the contract or when fibre deployment works started; remaining 50% to be settled according to the evolution of works with a prior lodging of a guarantee;

- Other contractual conditions and terms to be established between the parties.

DST believes that conditions for payment proposed by AMTQT are unacceptable as they are out of step with market conditions, and the early payment (at the time of the signature of the contract or at the start of works, that is, before pipelines are accepted) of a significant amount (50% of the overall contract amount) represents a high risk for DST, given that it is totally unaware of current network conditions that AMTQT is able to provide, in fact difficulties could arise when cable is laid.

On 30.10.2012, DST proposed to AMTQT that they signed a simple contract giving both parties time to finalise a contract that included not only financial obligations and obligations concerning the basic provision of access to pipelines but also all operational commitments and mutual reciprocal guarantees. Conditions proposed by DST are described in point 21 of its application.

On 02.11.2012, AMTQT rejected the conditions presented by DST and restated the conditions formerly conveyed, to which DST replied that it would not accept paying 50% of the overall amount of the contract at the time of the signature unless the Association provided guarantees, as it had absolutely no knowledge of the current network state⁷.

On 12.22.2012, AMTQT submitted to DST a minute of the “contract for access to infrastructure suitable for the accommodation of fibre optic of Associação de Municípios da Terra Quente Transmontana”, which included conditions already considered to be unacceptable by DST, namely those included in clauses 4⁸ and 5⁹ of the minute.

On 25.11.2012, DST returned the contract minute to AMTQT with amendments, which roughly entailed proposals presented by DST on 30.10.2012.

On 05.12.2012 AMTQT replied to DST, submitting a new version of the contract, which practically rejects all amendments introduced by the latter and restores payment conditions it had established:

- 50% at the time of the signature of the contract and remaining 50% to be paid in the course of the period during which fibre optic is expected to be deployed, in monthly instalments, or in a single instalment, where works are expected to be concluded in a period of less than one month;

- Prior lodging by DST of a bank guarantee corresponding to 50% of the total contractual price;

- Levels of service (stages of deployment and operation): 6 days for final resolution and 24 linear hours for provisional resolution.

On 06.03.2013, DST made a last contractual proposal to AMTQT, accepting an up-front payment of the equivalent of a one-year contract, with the possibility of renewing the contract for 20 years, insofar as during the first year the acceptance of the network was possible, the remaining part, corresponding to 20 years, being settled after this acceptance.¹⁰

On 20.03.2013, AMTQT rejected DST’s proposal¹¹, and the latter decided to launch this administrative dispute settlement procedure.

However, after DST started the administrative dispute settlement procedure, DST and AMTQT managed to reach a minimum agreement on clauses of the contract to be concluded, having signed on 25.07.2013 the Contract for Access to Infrastructures Suitable For the Accommodation of Fibre Optic, being referred in clause 18, paragraph 1, that it would be “reviewed according to conclusions reached by ANACOM on allegations presented by DST on payment conditions”.

By letter of 16.09.2014, DST recast the request made in the scope of the application of 25.03.2013, on the basis both of the time elapsed and the contract concluded in the meantime with AMTQT, requesting ANACOM to take a view on final conditions established for the remuneration for access to and use of the network held by AMTQT.

2. To this end, ANACOM held a meeting with AMTQT on 20.02.2015, at its premises in Oporto, to discuss the agreement concluded with DST for access to its pipelines. DST starts by considering conditions proposed by AMTQT to be illegal given that:

-  AMTQT never approved or disclosed procedures and conditions for access to and use of its infrastructures, namely standard contractual conditions and remuneration conditions applicable for access to and use of infrastructures, as required under DL No. 123/2009 - articles 17, point ) and 18, paragraph 1, points d) and e).
 
«The law imposes that the access to infrastructures suitable for accommodation of electronic communications networks is ensured under conditions of equality, transparency and non-discrimination, subject to cost-orientated remuneration conditions (...)». DST refers that these principles «prohibit access and use conditions, namely remuneration conditions, to become a barrier for whoever intends to obtain access».
 
It thus concludes that remuneration conditions that were established represent a clear barrier to access, as the Association requires DST to pay the full contractual price for the 20-year period during the first year of the contract, although the “use of the leased property is postponed.”
 
- The solution proposed by AMTQT is completely unbalanced, in the light of how a leasing contract works, declaring that this type of contract assumes that the consideration offered for using the leased property is paid periodically by the lessee as it uses the leased property, and that such rent is only due where the lessee is able to effectively use such leased property. DST claims that these are several legal provisions tending in this direction - referring point a) of article 1038 of the Civil Code, which provides that it is the lessee’s obligation to pay the rent or lease, rent meaning a periodic instalment (article 1075 of the Civil Code), and that, according to article 1039 of the Civil Code, the payment of rent or lease must be made on the last day of validity of the contract or the period to which it relates.
 
- The advance payment of the price in the course of the first year of the contract represents an advance financial burden and serves as a funding mechanism for AMTQT, representing on its own a violation of the principle of cost-orientation.
 
- In order to break the stalemate and to start quickly the fibre optic deployment works, DST accepted to pay 50% of the contractual price with the signature of the contract, in the scope with negotiations with AMTQT, in moment when it was not supposed to, as well as the remaining 50% after the fibre deployment was concluded, insofar as the Association waived the requirement of the provision of guarantee, and it provided itself a guarantee that ensured compliance with its obligation to make the network available for use under proper maintenance conditions, which was not the case.

- On the contrary, DST claims that AMTQT requires from DST, in addition to the advance payment of 50% of the total price of the contact at the moment of the signature of the contract, also the «provision, on the same date, of a guarantee of 50% intended to guarantee the payment of the remaining 50%», which is deemed to be, in the perspective of the applicant, a «doubly pernicious» financial burden, as it aims to ensure the compliance with an illegal demand in the light of the principle of cost-orientation and imposes a financial burden on a financial burden. DST adds that this requirement is unnecessary taking into account the commitments it undertook in contract with the Portuguese State.

3. After the conclusion of the contract between DST and AMTQT, and having DST paid [beginning of confidential information - hereinafter BCI]  [end of confidential information - hereinafter ECI] Euros (VAT included), corresponding to 50% of the price charged for the use of pipelines, DST recasts the request submitted on 28.03.2013, seeking from ANACOM, under article 10 of ECL and paragraph 3 of article 19 of DL No. 123/2009, that the Authority «determines that access granted by the Association to DST complies with the following conditions:

(i) Payment of the remaining contractual price ([BCI]   [ECI] Euros) in annual instalments, due on 1 January each civil year;
 
 Or in case the Authority does not agree with this,
 
(ii) Payment of the remaining contractual price ([BCI]   [ECI] Euros) upon conclusion of the fibre optic deployment by DST, with the lodging on this date of a bank guarantee on first demand by AMTQT, corresponding to 20% of the total contractual price concerning the first 10 years of the contractual period.
 
And, cumulatively,
 
(iii) Non-lodging of any bank guarantee by DST.

b.  Notification of Associação de Municípios da Terra Quente Transmontana

Having ANACOM made a preliminary analysis of DST’s claims, it was found that:

- DST is an electronic communications company [point f) of paragraph 1 of article 3 of DL No. 123/2009], and as such, it is allowed to request ANACOM’s intervention under paragraph 3 of article 19 of that statutory instrument;

- AMTQT is a public law association holding and operating infrastructures  suitable for the accommodation of electronic communications networks and, as such, it must ensure access thereto in compliance with Chapter II of DL No. 123/2009;

- ANACOM is entitled to enforce compliance with obligations laid down in DL No. 123/2009 and to assess and decide on whether refusal of access to a given infrastructure is admissible or whether the remuneration required, - in this case by AMTQT - for access to infrastructures suitable for the accommodation of electronic communications networks abides by the rule of cost-orientation of prices, as provided for in the identified statutory instrument;

- The request for intervention was timely - on the date ANACOM’s intervention was requested, one year had not yet elapsed on the date when negotiations between DST and AMTQT had started, and the stalemate/dispute on remuneration conditions only arises between September 2012 and March 2013;

- The decision taken by ANACOM binds both parties under dispute.

In the light of the above, on 17.05.2013¹², ANACOM notified AMTQT of the application it had received so that it assessed the matter in writing, if it so wished, within 10 working days, in order to evaluate whether the remuneration demanded for the use of infrastructures concerned was appropriate, in the light of DL No. 123/2009, especially article 13, paragraph 4, and article 19, paragraphs 1 and 4, requesting AMTQT to submit within 10 working days, information indicated below:

- All information on suitable infrastructures (pipelines, masts, etc.) it uses or manages, identifying in particular:

• infrastructures suitable for the accommodation of electronic communications networks that are held or managed by the Association, according to point a) of article 17, bearing in mind sub-point i) of point a) of paragraph 2 of article 96 of DL No. 123/2009;
• the identification of held or managed infrastructures which are part of public or private domain of local authorities, and why was their management entrusted to AMTQT;
• procedures and conditions for access to and use of infrastructures that are held or managed by the Association, according to point c) of article 17, bearing in mind point b) of paragraph 2 of article 96 of DL No. 123/2009;
• Which electronic communication companies are installed in infrastructures that are held or managed by the Association, as well as terms and conditions applied to those companies;
• List of infrastructures registered so far.

- Detail of costs involved, bearing in mind paragraph 1 of article 19 of DL No. 123/2009, both as regards the set of infrastructure associated to DST's request, as well as other accesses granted, as well as the reasoning for prices proposed for access.

DST was informed of steps taken on the same date¹³.

c. Response from Associação de Municípios da Terra Quente Transmontana

AMTQT replied by letter dated 30.05.2013¹⁴, providing the requested clarifications and assessing the matter raised by DST. AMTQT's response is structured in two parts (A - Background and B - Defence) which are summarised below.

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• A - Background https://www.anacom.pt/render.jsp?categoryId=384501
• B - Defence https://www.anacom.pt/render.jsp?categoryId=384502
• C - Draft Decision - hearing of stakeholders https://www.anacom.pt/render.jsp?categoryId=384503