German Telecoms Regulator Goes Back to Drawing Board on Competitive Analysis of Wholesale Leased Lines
Client Alert | 2 min read | 11.14.06
The German telecoms regulator (BNetzA) has withdrawn its proposal to the European Commission to divide up the German wholesale leased lines markets according to bandwidth. This is the second time in the last 12 months that the BNetzA has encountered opposition from the Commission in relation to its competitive analysis of telecom markets (previously, the Commission had insisted that it include VDSL in the wholesale broadband access market).
The proposal applied to unmanaged dedicated connections for transmission of voice and data. In early 2006, the BNetzA had conducted an analysis of the markets for wholesale trunk and terminating leased lines and concluded that it would be appropriate to divide service offerings into two categories: (i) up to and including 2 Mbit/s, and (ii) above 2 Mbit/s. A segmentation in this way meant that Deutsche Telekom would have been found to have significant market power only on the wholesale markets for leased lines up to 2 Mbit/s but not above 2 Mbit/s. As a result, regulatory obligations would no longer have been imposed on DT for the higher bandwidth market. In compliance with the EU regulatory framework for consultation on proposed regulatory measures, the BNetzA notified this proposal to the European Commission in August.
Although the Commission has accepted a delineation of the leased lines markets based on bandwidth for certain other countries (notably Greece, Italy, Lithuania, Netherlands and the UK), in almost all these cases, the segments were found not to be competitive. The only exceptions are the UK , where OFCOM found the market for terminating segments above 155 Mbit/s to be competitive and Lithuania, where terminating segments above 2Mbit/s were considered to be an emerging market which should not be regulated.
The Commission's serious doubts regarding BNetzA's findings referred to the lack of a substitution analysis by BNetzA regarding alternative interfaces to traditional leased lines (e.g., Ethernet), the failure to assess separately the market conditions in trunk and terminating segments and, more generally, that BNetzA had not provided sufficient market data to reach its conclusions. Following the Commission's indications of serious doubts about the proposals, the BNetzA has now withdrawn the notification and has indicated that it will seek additional data and will further analyze market developments.
Contacts
Insights
Client Alert | 3 min read | 11.21.25
On November 7, 2025, in Thornton v. National Academy of Sciences, No. 25-cv-2155, 2025 WL 3123732 (D.D.C. Nov. 7, 2025), the District Court for the District of Columbia dismissed a False Claims Act (FCA) retaliation complaint on the basis that the plaintiff’s allegations that he was fired after blowing the whistle on purported illegally discriminatory use of federal funding was not sufficient to support his FCA claim. This case appears to be one of the first filed, and subsequently dismissed, following Deputy Attorney General Todd Blanche’s announcement of the creation of the Civil Rights Fraud Initiative on May 19, 2025, which “strongly encourages” private individuals to file lawsuits under the FCA relating to purportedly discriminatory and illegal use of federal funding for diversity, equity, and inclusion (DEI) initiatives in violation of Executive Order 14173, Ending Illegal Discrimination and Restoring Merit-Based Opportunity (Jan. 21, 2025). In this case, the court dismissed the FCA retaliation claim and rejected the argument that an organization could violate the FCA merely by “engaging in discriminatory conduct while conducting a federally funded study.” The analysis in Thornton could be a sign of how forthcoming arguments of retaliation based on reporting allegedly fraudulent DEI activity will be analyzed in the future.
Client Alert | 3 min read | 11.20.25
Client Alert | 3 min read | 11.20.25
Client Alert | 6 min read | 11.19.25
