Dutch operators lose appeal over termination rates method

Dutch operators have lost a long-running appeal against the method used by the regulator ACM to set termination rates. The corporate appeals court (CBb) sided with the regulator's choice of the pure Bulric method recommended by the European Commission, rather than Bulric plus as advocated by the operators. The latter takes account of more general network costs, allowing for higher termination rates. 

Back in 2013 the court set the fixed and mobile termination rates higher than those proposed by ACM, siding with the operators in an initial hearing of the case. Those higher rates will not be adjusted retro-actively. 

The ACM has since taken a new decision on termination rates for the next three years, but the implementation of the latest cuts was delayed from 01 July pending the final court ruling. The new fixed termination rate was set at 0.139 cents per minute, and the mobile rate at 0.581 cents per minute. That compares to 0.302 and 1.861 cents respectively under the initial court decision from 2013. The new rates are based on the pure Bulric cost method. 

It is unclear whether the new rates will be allowed to go ahead, as the court upheld a partial claim from KPN and Vodafone that the ACM should have proposed a glide-path for the reduction in rates. The court noted that the sharp reduction in termination rates in the transition from Bulric plus to pure Bulric would likely result in more legal appeals, which could further delay implementation of the confirmed method. KPN has already appealed the latest cut in termination rates, which was provisionally expected to take effect 12 July.