Federal Council clears the way for new Telecommunications Act – Telecommunications Modernization Act comes into force on 1 December 2021

Berlin/Bonn 7 May 2021 At its meeting today, the Federal Council paved the way for a new Telecommunications Act by approving the Telecommunications Modernization Act (TKMoG). The law will come into force on December 1, 2021.

BREKO Managing Director Dr. Stephan Albers explains the amendment of the telecommunications law:

“The new Telecommunications Act, which was also passed by the Federal Council today, sets important priorities for the decisive stage of fiber optic expansion in Germany, but unfortunately does not take advantage of all the opportunities to accelerate expansion. Nevertheless, we are pleased that the legislative process, which is so important for the further expansion of fiber optics, has now been brought to a successful conclusion after a long run-up. Failure of the legislative process would not have been an option and would have prevented important impetus for further fiber optic expansion. It is now important to use the existing momentum in the expansion of fiber optics and to keep up the pace.

With the modernization of the apportionability of the broadband connection in the form of a so-called ‘fiber optic provision fee’, the legislator is implementing a BREKO proposal that will provide a strong incentive for fiber optic expansion in apartment buildings. We fought until the very end for our idea to be included in the law. This is now a huge opportunity for tenants and the housing industry to ensure that apartment buildings are also equipped with future-proof fiber optic connections directly to the apartments and that existing copper-based connections are replaced. This will provide the companies responsible for expansion with a practical tool to speed up expansion even more, especially in cities. The only fly in the ointment is that the existing regulation on levy eligibility will not expire until the end of June 2024. We would have liked a much shorter transition period so that the positive effect can unfold as quickly as possible for the benefit of the many tenants.

An important milestone for the future regulation of fibre optic networks is the legal establishment of the principle of “equivalence of input” (EoI). The concept stipulates that wholesale customers or co-investment partners have access to the same material and personnel resources as the sales department of the company with market power. This means, for example, that the same databases for information on connections and the same technician resources for provisioning and fault clearance can be used, thereby significantly reducing the risk of abuse of the dominant market position. In short, this means that in future it will only be possible to dispense with regulation if the dominant company implements these requirements on a mandatory basis.

In the area of approval procedures and the use of alternative installation methods, the law misses the great opportunity to finally release the existing brakes. Everyone is rightly calling for the expansion of fiber optics to be accelerated. However, this also requires an appropriate legal framework. The possibilities have not been fully exploited here. An even greater acceleration of expansion could have been achieved very simply by recognizing alternative installation methods as standard, which, despite years of positive experience in practice, cannot yet be used everywhere where this would make sense.

In addition, the establishment of a coordinating body to speed up approval procedures, which should ideally be set up at the level of the districts and independent cities, is no longer set out in the law as a mandatory requirement for the federal states. Due to the open wording, we run the risk that this really helpful measure will not be implemented as a result. The implementation of the so-called ‘one-stop-shop principle’ would be helpful for the expanding companies in many respects. The coordinating body, as an ‘advocate for fiber optic expansion’ between the authorities and companies involved in the approval process, can help to remove obstacles as quickly as possible. We appeal to the federal states, districts and cities to use and implement this instrument, as it will have a considerable positive impact on accelerating the expansion of fiber optics.

The implementation of the universal service/’legal entitlement to fast Internet’ is also critical. Universal service is not an accelerator of expansion. Self-economic expansion, flanked by a prudent incentive and funding policy, will get us to our goal faster than any state expansion obligation, which ties up already scarce civil engineering capacities. Radio-based solutions such as satellite communication should also be used to enable digital participation quickly for households with particularly poor coverage.”