Communiqué de presse

ART rules on the dispute between Free and France Telecom regarding interconnection for telephone calls to Freebox subscribers

Paris, 31 July 2003

Autorité de régulation des télécommunications (ART) has ruled on a complaint launched by Free on 28 March 2003 regarding a dispute with France Telecom concerning the form of interconnection used to route telephone calls to the "universal and personal numbers" of its "Freebox" subscribers.

ART's decision follows another of 15 May 2003 in which ART rejected Free's request for protective measures on the same subject.

· Universal and personal numbers

The service which Free wishes to sell is based on the use of 08 7B PQ MC DU phone numbers, called "universal and personal numbers".

These are non-geographic numbers, i.e. they do not depend on the subscriber's location, like those used by special services and mobile subscribers.

In "universal and personal number" services, the use of 08 7B PQ MC DU numbers permits calls to be routed to subscribers' telephone lines. Thus, these calls can be considered "interpersonal" calls, distinguishing them from calls made to special services.

· The need for a "direct" interconnection mode

The dispute concerned the type of interconnection used to route calls made by France Telecom subscribers to Free's 08 7B PQ MC DU numbers. Free wished to use France Telecom's "indirect" interconnection offer which is currently used to route calls to the special services of third-party operators and which allows them to choose the price that France Telecom applies for calls to their own numbers. France Telecom, on the other hand, wished to apply the "direct" mode under which France Telecom sets its price in line with the call termination charges the third-party operator invoices it to route calls on its network to its numbers.

In its decision, ART considers that direct interconnection, which is currently used in interconnection agreements between local loop operators and between fixed line operators and mobile operators, is better suited than indirect interconnection to route interpersonal calls when the conditions for effective competition on the market are met, particularly for the price of these calls.

Therefore, ART decided that, following a transition phase to end by 1st July 2004 at the latest, the parties will have to apply direct interconnection to route calls to the 08 7B PQ MC DU numbers assigned to Free.

· Application of a temporary regime at Free's service launch

Still, ART felt that the unusual circumstances of the dispute between France Telecom and Free merited the immediate, temporary application of the technical and pricing measures under the indirect interconnection offer currently provided by France Telecom to route calls to the special services of third-party operators.

In particular, ART took into account the fact that calls to non-geographic numbers do not currently benefit from competition conditions equivalent to those which exist for telephone calls to geographic numbers. It also took into consideration the fact that the effective launch of Free's telephone service had been suspended because of the parties' inability to agree on the tariff to be applied by France Telecom for calls to 08 7B PQ MC DU numbers.

As for the tariff to be applied during the transition period, ART chose one equal to that applied to calls to France Telecom's "Azur" numbers. However, ART emphasized that the application, by 1st July 2004 at the latest, of direct interconnection for the routing of calls to the numbers allocated to Free could lead, depending on the call termination charges billed by Free, to France Telecom defining a different tariff than that for calls to "Azur" numbers.