Clarifications relating to article 35 of the Auction Regulation

It was alleged by TMN that only with the analysis of the Draft Report and its annexes, it found that ICP-ANACOM adopted an initial position on the issue of clarifications provided in relation to article 35 of the Auction Regulation and then shifted to a diametrically opposite position which, in the view of the company, is unlawful.

Indeed, TMN takes the view that:

a) Article 137 of the CPA does not provide legitimacy to ICP-ANACOM's "partial substitution" of clarifications provided in respect of article 35 of the Auction Regulation to OPTIMUS, to ZON Multimédia, S.A. and to Grupo ZAPP.pt;

b) Since the "new" clarifications were not provided on a valid basis, they cannot be considered as prevailing over the "original" clarifications.

TMN bases its position on the premise that, in its opinion, this case does not entail ratification, reform or conversion of an administrative act, since it fails to fulfil the two requisites for this purpose: (i) that the clarification in question is an administrative act and (ii) that the original clarification is an invalid act.

With regard to the first of these requisites, TMN states that regulations may only be amended or interpreted by other regulations and not by administrative acts, whereby either the clarifications were administrative acts and, being in breach of regulation, were therefore unlawful or otherwise the clarifications are not administrative acts but regulations and therefore not covered by article 137 of the CPA, in which case the substitution of the information provided by ICP-ANACOM is invalid.

The second requisite also remains unfulfilled, according to TMN, since the original clarification would not have been invalid, ruling out the applicability of article 137 of the CPA.

Position of ICP-ANACOM

Without dismissing the distinction between regulation and administrative act, as detailed by TMN, ICP-ANACOM is of the view that it is important, above all, to ascertain that this Authority acted in this regard within its powers and in compliance with the Auction Regulation.

Pursuant to paragraph 1 of article 11 of the Regulation Auction, ICP-ANACOM provided clarifications to OPTIMUS and ZON Multimédia, S.A. (on October 27) and to Grupo ZAPP.pt (on 31 October) on a range of matters related to the regulation and specifically on the network access obligation referred to in point b) of paragraph 4 of article 35, in accordance with the conditions stipulated in paragraph 5 of the same Article, namely:

• The obligation to agree to negotiate national roaming agreements with third parties which hold rights of use of frequencies in the bands above 1 GHz and which do not hold rights of use of frequencies over more than a total of 2 x 5 MHz cumulatively in the 800 MHz and 900 MHz bands;
• This obligation of access applies to third parties which undertake, within a period of 3 years, to use their frequencies in the 800 MHz or 900 MHz frequency bands in such a way as to achieve a coverage level which corresponds to making the service available to no less than 50% of the national population.

These clarifications were provided in response to specific questions put by these companies, which raised questions as to the interpretation of these rules.

Firstly, it is important to emphasise, subsequent to the position of ICP-ANACOM as set out in Section I of the present report, that the clarifications in respect of the auction proceedings, and in terms of the respective regulation, are governed by a very particular set of rules. Indeed, the option under the Auction Regulation was that the clarifications provided in response to requests addressed to ICP-ANACOM were not meant, in principle, for general dissemination. It is solution which differs from that currently employed in the context of tender procedures, where clarifications provided by the contracting authority are made available to all interested parties (see paragraph 4 of article 50 of the CCP - Código dos Contratos Públicos (Public Procurement Code). This option, as mentioned, took care to safeguard the confidentiality of the procedure, without prejudice to the requirement for transparency and impartiality, which is reflected in the solution of enabling ICP-ANACOM to disclose general clarifications.

The nature of the act of providing individualised clarifications to each interested party requesting them stems directly from these particular rules governing clarifications - in specific and individual situations. Given these special characteristics, this act is certainly not regulatory in nature, nor is it contaminated by the regulatory nature of the Auction Regulation. In fact, each of the clarifications provided by ICP-ANACOM pursuant to paragraph 1 of article 11 of the Auction Regulation had content focusing on a specific situation and was addressed individually to the respective recipients, whereby notification was limited to said recipients. They were, therefore, specific and individual resolutions.

It must there be concluded that, based on the legal notion of an administrative act - decision of an administrative body which, under public law, is intended to produce legal effects in an individual and specific situation (article 120 of the CPA) - the clarifications provided individually to each party pursuant to paragraph 1 of article 11 of the Auction Regulation entails a determination on or a resolution of an issue which is put by a private party ¹.

Accordingly, it must be concluded that the regime set out in article 137 of the CPA on the ratification, reform or conversion of an administrative acts is applicable.

Secondly, ICP-ANACOM rejects the notion that it would be correct to consider the substitution of the initial interpretation with the interpretation conveyed in second place as constituting an amendment to the Auction Regulation.

Referring to page 173 of the "Curso de Direito Administrativo" (Course in Administrative Law) by Diogo Freitas do Amaral, TMN affirms that "regulations may only be amended or interpreted by other Regulations and not by administrative acts." The page of this cited work, which can be read, is not as referenced by TMN, rather stating that "regulation is interpreted, and its weaknesses are integrated, in accordance with its own rules of interpretation and integration of legal rules; for the administrative act, other specific rules exist which apply to interpretation and integration - own rules of interpretation and integration of the administrative act."

Accordingly, what is important to keep in mind - and this is surely not questioned by TMN - is that the Auction Regulation established a clear and unequivocal rule insofar as it made it incumbent upon ICP-ANACOM to provide clarification to interested parties as to any uncertainties arising with regard to the interpretation of any documents governing the auction process.  As such, ICP-ANACOM was given the power and the duty to interpret the Auction Regulation, as a document governing the auction. Therefore, given the nature of the clarifications provided under the terms of paragraph 1 of article 11 of the Auction Regulation, as individual and specific to each of the interested parties, it is naturally incumbent upon ICP-ANACOM, when called upon to correct such interpretation, to proceed with its correction. The course of action followed was the required course, in light also of the principles of administrative activity, including good faith and collaboration with private undertakings.

Accordingly, it is important to completely dispel the notion that ICP-ANACOM may have lacked authority in substituting the clarifications provided with another which it deemed more appropriate, considering that the first clarification suffered from contradiction as regards the combination of two rules of the Auction Regulation and as regards the position of ICP-ANACOM as expressed in the Regulation's public consultation report. Indeed, regardless of the legal nature of the act concerned, ICP-ANACOM would always retain authority to proceed with its substitution or amendment.

With the practice of these acts, ICP-ANACOM made no amendment to the Auction Regulation, whereby notification of the adopted decisions was limited to the respective recipients only. It cannot therefore be claimed, as is alleged by TMN, that these acts of ICP-ANACOM lack validity as constituting a violation of regulation ².

However, in parallel, and given the relevance of the clarification in question, the subject matter, insofar as it was relevant, was included in the general clarification issued on 2 November and published on the website of ICP-ANACOM on the same day.  Pursuant to paragraph 5 of article 11 of the Regulation Auction, this clarification covered a wide range of matters which ICP-ANACOM, taking into account the various requests for clarification received, deemed as warranting the manifestation of its position.

These general clarifications include general and abstract positions, such as in respect of the regulation itself, i.e., they do not define specific recipients or specific situations.

In all such cases, the clarifications therefore constitute an interpretation of the documents governing the auction process, conducted by the entity that possesses the originating regulatory power, under the terms of its statutes and of the Lei das Comunicações Eletrónicas (Electronic Communications Law) ³.

In conclusion, ICP-ANACOM has acted in full observance of the applicable rules in all aspects of its conduct throughout the period of provision of clarifications pursuant to the Auction Regulation.