Ministério das Finanças (Ministry for Finance)
Decree-Law
In 1994, Portugal Telecom, S.A. was formed, by means of a merger of Telecom Portugal, S.A., Telefones de Lisboa e Porto, S.A. and Teledifusora de Portugal, S.A. Subsequently, the bases of the concession of the telecommunications public service were approved, by Decree-Law no. 40/95 of 15 February, the respective concession contract having been entered into with Portugal Telecom, S.A., valid until 2025 (“Concession Contract”).
In the meanwhile, in the framework of the restructuring operation of the Portugal Telecom Group, the newly created society – PT Comunicações, S.A. – took over the set of rights and obligations of the concessionaire of the telecommunications public service, through the transfer of the contract from the concessionaire to this society, the transfer being approved pursuant to Decree-Law no. 219/2000 of 9 September.
Thus, as from 1995, a establishing and regulating framework for the concessionaire action was established, regarding on the one hand the provision of the concessionary telecommunications public services, and on the other hand the operation of infrastructures attached to the provision of those services, namely the telecommunications basic network (“Basic Network”), which at the time represented an asset belonging to the public domain of the state.
On the expiry of seven years from the date of the signature of the concession contract, and in a context of the full liberalisation and open competition of the global communications sector, many transformations have taken place in the national and international arena.
In fact, the telecommunications liberalisation process having come to an end, the status of an asset belonging to the public domain of the state is no longer justified, having regard namely to the fact that the access to this network on the part of all telecommunications operators is duly ensured by the regime of open network provision, to which the concessionaire is bound under the law and the concession contract itself.
In this respect, the deassignment of the basic network from public domain on the part of the State, operated pursuant to Law no. 29/2002 of 6 December, and likewise its disposal in favour of the concessionaire, represents not only a natural evolution of the national telecommunications market, but also a measure of sound financial management, since it gives the State the possibility to earn substantial as well as immediate revenue, regarding the payment of a rent up to 2025 for the concession of the basic network to PT Comunicações, in accordance with the respective Concession Contract.
Being the basic network the support of the provision of the telecommunications universal service, and since PT Comunicações was designated, pursuant to Decree-Law no. 458/99 of 5 November, as the provider of the universal service, being also assigned the provision of further public services, it is essential that the concession contract is amended so as to adapt it, namely, to the new network ownership regime, while avoiding any disturbance either to the essential core of the rights and obligations entered into by the concessionaire in the course of the concessionary activities, or to the financial equation on which the concession contract was based from the beginning.
The provision of the telecommunications universal service was ensured in strict compliance with the applicable legal standards.
With the amending agreement of the concession contract, the bases of which are published in annex with this statutory instrument, the Government expects to have achieved a contract not only adapted to the regulatory environment of the sector concerned, but also granted with the degree of flexibility necessary to the operation of the concessionaire, in a sector characterized by a strong competitiveness and dynamism. This was attained without disturbing the core of the interests of the State, the rights and obligations of the concessionaire, the economic balance of the concession contract, the commitments entered into by the State with the shareholders of Portugal Telecom and the general market at the time of its privatisation, as well as the interests of the remaining market operators and consumers.
The bodies representing users were consulted, pursuant and for the purposes of Laws no. 23/96 of 26 July and no. 24/96 of 31 July.
Therefore:
Pursuant to paragraph 1a) of article 198 of the Constitution, the Government hereby decrees the following:
Article 1
Amendment of the bases of the concession
1 – The bases of the concession of the telecommunications public service, published in annex to Decree-Law no. 40/95 of 15 February, are hereby amended, being replaced by the bases of concession in annex to this statutory instrument, of which they form integral part.
2 – All legislative references to the bases of the concession in annex to Decree-Law no. 40/95 of 15 February shall be considered to be made to the bases of concession in annex to this statutory instrument.
Article 2
Dismissal and burdening of the basic network
1 - The dismissal of the telecommunications basic network by the concessionaire is authorized, without prejudice to its attachment to the provision of the universal service.
2 – The concessionaire is bound to maintain the ownership of the basic network for the period in which the concession remains in force, save for the sub-concession cases permitted pursuant to the bases mentioned in article 1.
3 – The concessionaire, or the owner of the basic network, where the entity is not the same, shall report to the member of the Government responsible for the communications sector all legal operations that result in the dismissal or burdening of the basic network within ten days from the respective conclusion.
4 – The State may supervise the basic network, and for this purpose it shall be granted, namely, free access to all infrastructures, assets and documents concerning the mentioned network.
Article 3
Maritime mobile service
The provision of the maritime mobile service shall be ensured by the concessionaire on a transitional basis, up to the respective transfer to a different entity, which shall take place at the most within one year from the date of publication of this statutory instrument.
Article 4
Repealing provision
Decree-Law no. 40/95 of 15 February is hereby repealed.
Article 5
Entry into force
This statutory instrument shall enter into force on the day following its publication.
Checked and approved in the Council of Ministers of 11 December 2002. – José Manuel Durão Barroso – Maria Manuela Dias Ferreira Leite – Carlos Manuel Tavares da Silva.
Promulgated on 31 January 2003. Let it be published. The President of the Republic, JORGE SAMPAIO.
Counter-signed on 7 February 2003. The Prime Minister, José Manuel Durão Barroso.
ANNEX
Bases of the concession telecommunications public service
CHAPTER I
General Provisions
Article 1
Definitions
For the purposes of the provisions of the present bases:
a) “Granting authority” shall mean the Portuguese State;
b) “Concessionaire” shall mean PT Comunicações, S.A.;
c) ''ICP – ANACOM'' shall mean ICP – Autoridade Nacional de Comunicações;
d) “Telecommunications basic network” shall mean the telecommunications public network as defined in article 12 of Law no. 91/97 of 1 August;
e) “Transport and broadcasting infrastructures” shall mean the infrastructures engaged in the emission, reception, transmission and distribution of broadcasting telecommunications;
f) “Integrated Services Digital Network (ISDN)” shall mean the set of telecommunication infrastructures that, being an integral part of the telecommunications basic network, where it is fundamentally intended to provide the telephone fixed service, enables the provision of digital connections between two terminal points which offer a large range of telecommunications services, in compliance with the relevant recommendations of the International Telecommunications Union (ITU), namely, ITU Recommendation I.112;
g) “Fixed telephone service” shall mean the provision to the general public of direct transport of real-time speech, at fixed locations, such that any user may use equipment connected to a network termination point to communicate with another termination point;
h) "Fixed telex service” shall mean the provision of the addressed transport of telex messages, both to and from terminal points of the telecommunications basic network, in compliance with the relevant ITU Recommendations, namely Recommendation F.60, using the international alphabet no. 2 included in Recommendation S.1 and transmission at 50 Baud, such that any user may use equipment connected to his network termination point to communicate with another termination point;
i) “Leased lines” shall mean the telecommunications facilities of the public network which provide for transparent transmission capacity between network termination points and which do not include switching functions which the user can control;
j) “Fixed switched data transmission service” shall mean the provision of addressed data transport, both to and from the subscriber fixed access system, such that any user may use equipment connected to his network termination point to communicate with another termination point;
l) “Telegraph service” shall mean the provision of a reception, transmission, reproduction and delivery service to the message addressee, in compliance with the relevant ITU Recommendations;
m) "Universal service” shall mean the set of specific obligations associated with the provision of telecommunications services of addressed public use, aiming for the fulfilment of the communication needs of the population and of social and economic activities throughout the national territory, in terms of equality and maintenance, and by means of appropriate remuneration conditions, having regard to the demands of a harmonious and balanced economic and social development;
n) "User” shall mean any natural or legal person to whom the services provided by the concessionaire within the scope of the concession contract are made available;
o) “Case of force majeure” shall mean any unexpected and insuperable event, the effects of which are produced irrespective of the will or personal circumstances of the parties, namely situations of natural disaster, acts of war, whether declared or not, subversion, alteration of public order, economic blockage and fire.
CHAPTER II
Object and scope
Article 2
Object
1 – The concession aims for:
a) The provision of the telecommunications universal service, within the scope defined in Decree-Law no. 458/99 of 5 November;
b) The provision of the following services:
1) Fixed telex service;
2) Fixed switched data transmission service;
3) Broadcasting and distribution service of the telecommunications broadcast signal;
4) Telegraph service.
2 – The concession aims further for:
a) The development and operation of infrastructures which integrate the telecommunications basic network, in articulation with the territorial planning and the needs of citizens regarding security and civil protection;
b) The establishment, management and operation of the transport and broadcasting infrastructures of the telecommunications broadcast signal;
3 – Without prejudice to the provisions of the present bases, the operation of the telecommunications basic network shall be ruled by the provisions of the Regulation of the Telecommunications Basic Network Operation, as well as by further legislation applicable to the communications sector.
4 – The provision of the fixed switched data transmission service may be ensured indirectly by the entity entitled for this purpose under the law.
5 – In addition to the provision of paragraph 1, the granting authority may assign the concessionaire the task of the operation of further telecommunications services of public use, where the public interest, duly acknowledged, so justifies, under conditions to be agreed between the parties, which shall be integrated as amendments to the concession contract.
Article 3
Other services and activities of the concessionaire
1 - The concessionaire may provide any telecommunication services other than those in article 2, as well as carry out any complementary or accessory activities relating to the aim of the concession, either directly or through the setting up or shareholding of a partnership.
2 - The provision of services and the activities mentioned in the preceding paragraph shall not disturb the compliance of the concessionaire with the obligations laid down in the concession contract and, where appropriate, shall be ruled by the respective qualifying titles and further applicable standards.
CHAPTER III
Territorial scope and concession period
Article 4
Scope and concession period
1 – The concessionaire shall pursue its activity on national territory, ensuring international connections.
2 – The concession contract expires on 20 March 2025.
Article 5
Means engaged in the concession
1 – The concessionaire is bound by the concession contract to engage in the concession the infrastructures that integrate the telecommunications basic network.
2 – The assets that, at a given time, are deemed essential to the provision of the concessionary services shall be engaged in the concession.
3 – The engaging in the concession of the infrastructures and further assets referred to in the preceding paragraphs shall be without prejudice to the possibility of the respective dismissal, substitution and/or burdening, in so far as the provision of concessionary services is not affected.
CHAPTER IV
Obligations of the concessionaire
Article 6
General obligations of the concessionaire
Pursuant to the concession contract, the concessionaire is assigned the following general obligations:
a) To comply with national law in force, in the applicable parts, with orders, injunctions, commands, directives and instructions that, under the law, are issued by the competent authorities, as well as with determinations that, under the law or the concession contract, are issued by the granting authority or ICP – ANACOM;
b) To provide the concessionary services, ensuring their interoperability, continuity, availability, maintenance and quality;
c) To guarantee and enforce the confidentiality of communications made through the services provided, as well as the inviolability of the support infrastructures;
d) To comply with the numbering plan, under the terms set forth by ICP – ANACOM;
e) To give leave and facilitate the supervision of the concession, on the part of the granting authority and ICP – ANACOM, namely by promoting the access to the respective documentation and premises;
f) To make available and issue to ICP – ANACOM within the time limit and pursuant to the terms and conditions laid down, the information and statistical data deemed necessary for the supervision of the activities carried out within the scope of the concession or the development of the activity of the telecommunications market;
g) To report to ICP – ANACOM any amendments to be included in the respective partnership agreement;
h) To comply with the rules that may come into force in the future, even if the provisions arise from needs or demands of public use of any of the services provided, unforeseen at the time of the concession;
i) To guarantee, in a suitable and proper way, the functioning of telecommunication services during crisis, emergency or war situations;
j) To guarantee the provision of services included in the concession throughout national territory, without displaying any preference towards them nor discriminating any person, natural or legal, that requests them.
CHAPTER V
Infrastructures
Article 7
Telecommunications basic network
1 – The telecommunications basic network shall function as an open network, its use having to be ensured, in equal conditions, by all operators and providers of public use telecommunications.
2 – For the purposes of the preceding paragraph, the following shall be ensured:
a) The access and interconnection in conditions of equality, transparency and non-discrimination, under the law;
b) The availability of leased lines throughout the national territory, necessary to the provision of telecommunication services of public use;
c) The access, under the law, to ducts and masts, further equipment and facilities, provided for remuneration to be agreed between the parties or, in the absence of an agreement, to be determined by ICP – ANACOM.
3 – It is incumbent upon the concessionaire to maintain the basic network infrastructures in good working order, safely and well maintained, as well as to watch over its functioning and appropriate operation.
4 – It is also incumbent upon the concessionaire to develop the infrastructures of the telecommunications basic network, in order to ensure quality levels appropriate to the services they support.
Article 8
Transport and broadcasting infrastructures
The following shall be obligations upon the concessionaire, in the scope of the establishment, management and operation of the transport and broadcasting infrastructures of broadcasting telecommunications:
a) To ensure that, under the law, the concessionary entities of public service of radio and television broadcasting, as well as further entities with licenses for the exercise of radio and television broadcasting, shall have access in conditions of equality and non-discrimination, to the networks of signal transport and broadcast necessary for the respective coverage;
b) To develop the infrastructures referred to in the preceding paragraph in qualitative and quantitative terms, in order to guarantee the contracted quality levels.
CHAPTER VI
Provision of the telecommunications universal service
Article 9
Telecommunications universal service
It is incumbent upon the concessionaire to provide the telecommunications universal service, in compliance with the provisions of Decree-Law no. 458/99 of 5 November and further applicable law.
CHAPTER VII
Provision of other telecommunications services
Article 10
Fixed telex service, fixed switched data transmission service and telegraph service
It is incumbent upon the concessionaire, in the scope of the fixed telex service, fixed switched data transmission service and telegraph service, to guarantee the provision of those services, ensuring their interoperability, continuity, availability, maintenance and quality, in compliance with this concession and remaining legislation in force.
Article 11
Broadcasting and distribution service of the telecommunications broadcast signal
The following shall be specific obligations upon the concessionaire, in the scope of the provision of the broadcasting and distribution service of the telecommunications broadcast signal:
a) To ensure, in conditions of equality and non-discrimination, the broadcasting of the telecommunications broadcast signal to licensed operators that so request;
b) To ensure the broadcasting of the television public service;
c) To guarantee, pursuant to applicable law, that signals are broadcasted to the respective operators, according to coverage phases and time limits;
Article 12
Services provided via ISDN
The access to services provided via ISDN shall be a specific obligation upon the concessionaire, using for the purpose a minimum set of essential offers and additional offers, under the terms to be established by ICP – ANACOM.
Article 13
Provisions available free of charge
1 – It is incumbent upon the concessionaire to ensure that final users are provided, free of charge, with:
a) The access to repair and claim services;
b) The periodic edition and distribution of subscriber directories of telephone and telex fixed services;
c) Other provisions with interest for the general public or aimed at citizens with special needs, established as such in the universal service convention.
2 - In addition to the provision of the preceding paragraph, it is incumbent upon the concessionaire to provide, free of charge, the telecommunications service of public use, as regards the concession, to the President of Republic, the President of the Assembly of the Republic, the Prime Minister, the President of the Supreme Court of Justice, the President of the Constitutional Court, the President of the Supreme Administrative Court, the President of the Supreme Military Court, the President of the Court of Auditors, the Government members, the Attorney-General of the Republic and the Ombudsman.
CHAPTER VIII
Rights of the concessionaire
Article 14
Rights of the concessionaire
1 – The concession contract empowers the concessionaire to provide the concessionary services and to develop the activity of telecommunications fixed network operator.
2 – The following constitute rights of the concessionaire:
a) To charge the price of services provided;
b) To occupy and use streets, roads, tracks, watercourses, land along railroads and lines of communication of public domain, as well as to perform the necessary works or repairs for the implantation of infrastructures of the basic network of telecommunications or to the crossing of the different parts of infrastructures or equipment of the mentioned network, as well as of the infrastructures engaged in the concession, pursuant to article 13 of Law 91/97 of 1 August and further applicable law, with exemption of municipal licence;
c) To request compulsory purchases in the public interest, to request the constitution of administrative uses, to establish protection zones and to have access to public or private land and buildings, where deemed necessary for the compliance with the concession obligations and in conformity with legislation in force;
d) To use radio frequencies and numbering resources, or others, deemed necessary for the provision of services as regards this concession and which have been assigned by ICP – ANACOM.
Article 15
Price regime for the telecommunications universal service
The price regime for the telecommunications universal service shall be ruled by the provisions of Decree-law no. 458/99 of 5 November.
Article 16
Price regime for other services included in the concession
1 – The price regime for the fixed telex service, the telegraph service and the mobile maritime service shall comply with the principles of transparency, non-discrimination and cost orientation, ensuring accessibility for end-users.
2 – ICP – ANACOM shall ensure the application of the principles mentioned in the preceding paragraph, and for this purpose may determine a system of maximum prices or similar.
3 – The price regime for the access to the network of the television signal transport and broadcasting shall comply with the principles of transparency, non-discrimination and cost orientation, being incumbent upon ICP – ANACOM to ensure the respect for these principles, having heard the Institute for Social Communication.
Article 17
Quality of other services included in the concession
1 – The concessionaire shall provide the telex, telegraph and mobile maritime services according to indicators relating to quality service and performance aims, to be settled by ICP – ANACOM, having regard namely to criteria such as user demand satisfaction and geographical dispersion.
2 – The concessionaire shall send every three months to ICP – ANACOM, the particulars that shall enable the efficient assessment of the indicators relating to quality service and performance aims, according to methods and technical means defined for the respective determination and set as such pursuant to the preceding paragraph.
Article 18
Analytical accounts
1 – The concessionaire shall keep a system of analytical accounts, appropriate to the tariff principles determined in this concession, as well as in further applicable legislation.
2 – It is incumbent upon ICP to approve the methodology to be used in the implementation and use of the system mentioned in the preceding paragraph, as well as to assess and declare its compliance.
3 – Where the concessionaire provides other services in a direct way, pursuant to paragraph 1 of article 3, it shall ensure the adequate accounts segregation of revenues and costs, as well as connected assets and liabilities.
Article 19
Inventory of the concessionaire
1 – The concessionaire shall to prepare and keep updated an inventory of the assets engaged in the concession, which shall be sent to ICP – ANACOM every year, duly certified by an auditor acceptable to the latter, for purposes of approval.
2 – Where the inventory is not approved, the process shall be submitted to a court of arbitration.
3 - Without prejudice to other applicable penalties, where the provision of paragraph 1 is not complied with, the granting authority is entitled to make an inventory of the assets engaged in the concession, the concessionaire being charged with the costs incurred.
CHAPTER IX
Negative operating margins
Article 20
Compensation for negative margins of the universal service
The negative operating margins relating to the provision of the telecommunications universal service, where they exist, shall be compensated pursuant to the provisions of Decree-Law no. 458/99 of 5 November.
Article 21
Compensation mechanisms for the negative operating margins resulting from the provision of other telecommunications services integrated in the concession
1 – Having regard to the special nature of the fixed telex service, the telegraph service, the television broadcasting service and the mobile maritime service, the negative operating margins possibly resulting from the compliance with obligations established in the concession contract shall be compensated every year, as to the provision of these services, through a direct compensation of the part of the State.
2 – For the purposes of the provision of the preceding paragraph, the concessionaire shall present the negative operating margins resulting from the provision of the services mentioned in the preceding paragraph to ICP - ANACOM, who shall submit them to the Inspectorate-General for Finances, after an audit performed by an independent entity designated by the communications authority.
CHAPTER X
Intervention by third parties
Article 22
Intervention by third parties in the activity of the concessionaire
Without prejudice to the provision of the following article, the concessionaire is authorized to subcontract third parties to work or provide services that constitute or relate to the obligations assumed by the concessionaire pursuant to the concession contract.
Article 23
Sub-concession
1 – Subject to the prior consent of the granting authority, the concessionaire may grant a sub-license, in part or totally, regarding the operation of services this concession aims for.
2 – The consent of the granting authority is deemed to be implicitly given where it is not refused within 60 days from the date of the submission of the request.
Article 24
Position of the concessionaire in case of intervention by third parties
1 - In cases of intervention by third parties in the concession, provided for in articles 22 and 23, the concessionaire maintains its rights and is bound to the obligations resulting from the concession contract or applicable legislation, being responsible before the granting authority for the strict compliance with it.
2 – The exceptions and means of defence that result from the contractual relations established by the concessionaire pursuant to articles 22 and 23 of the concession contract cannot be invoked against the granting authority.
3 – The concessionaire is liable for the damages caused to third parties by the entities it engaged in the activities comprised in the concession, on the general basis of a principal - agent relationship.
CHAPTER XI
Supervision of the concession
Article 25
Supervision of the concession
1 – The supervision of the concession, including the supervision of the basic network, is incumbent upon the Ministry for Finance, through the Inspectorate-General for Finance, regarding financial issues, and upon the Ministry for the Economy, regarding remaining concerns, the competencies of whom shall be performed by ICP – ANACOM.
2 – For the purposes of the preceding paragraph, the concessionaire shall cooperate fully with the Inspectorate-General for Finance and ICP – ANACOM, granting free access to premises, equipments of any nature and all documentation and archives, giving all information and making available any particulars that are solicited, namely as regards statistical data and management records that have been used, and providing all the requested clarifications regarding these documents.
3 – At the request of ICP – ANACOM, in conformity with criteria of reasonableness and in the presence of representative of the concessionaire, tests may be performed with a view to assess not only the conditions of functioning, security and maintenance of the telecommunications basic network and the infrastructures engaged in the concession, but also the quality levels provided in the different services included in the concession.
4 – The determinations issued by ICP – ANACOM according to criteria of reasonableness, in the scope of the supervisory powers shall apply immediately and bind the concessionaire, without prejudice to the process of resolution of disputes provided for in article 38.
5 – ICP – ANACOM and its agents are subject to the requirement of confidentiality as to the collected information, namely the ones of a commercial nature, in the scope of the supervisory actions accomplished, and shall not use or disclose them for other purposes than the supervisory action or other deemed relevant under the law.
6 – Where the concessionaire does not comply with determinations issued by ICP – ANACOM in the scope of its supervisory powers, the communications authority may rectify the situation, either directly or trough a third party, the concessionaire being charged with the costs incurred.
Article 26
Determinations subject to authorization
1 – The mergers and divisions are subject to the previous authorization of the granting authority, which is deemed to be implicitly given where it is not refused within 30 days from the date of the submission of the respective request.
2 – The authorization referred to in the preceding paragraph shall not be unreasonably refused.
CHAPTER XII
Collaboration between the parts
Article 27
Duty to collaborate
Pursuant to the concession contract, the parts shall comply with their commitment to cooperate and provide assistance upon a reasonable request, in order to ensure the development of the activities integrated in the concession.
CHAPTER XIII
Non-compliance with the concession contract
Article 28
Contractual fines
1 – Without prejudice to the situations of non-compliance that may lead to seizure or to the cancellation of the concession pursuant to articles 30 and 35, non-compliance on the part of the concessionaire of the obligations arising from the concession contract or determinations of the granting authority, issued pursuant to the law or the concession contract shall be liable to contractual fines not exceeding €500000, applied by ICP – ANACOM, updated every year by the consumer price index, according to the seriousness of infringements committed, the corresponding losses, as well as to the default of the concessionaire.
2 – The fine application shall be preceded of a hearing of the concessionaire, pursuant to article 100 of the Code of Administrative Procedure, approved by Decree-law no. 442/91 of 15 November.
3 – The fines referred to in paragraph 1 shall be applied following a deliberation of the board of administration of ICP – ANACOM, which shall be forwarded in writing to the concessionaire, and shall be effective regardless of any other formalities.
4 – The fines applied pursuant to this article shall revert to the State at 60% and to ICP – ANACOM at 40%.
5 – The payment of fines applied pursuant to this article shall not exempt the concessionaire of civil liability for losses and damages arising from the infringement.
Article 29
Non-contractual liability
The concessionaire is liable, under general law, for any damages caused to third parties in the carrying out of the activities constituting the aim of the concession, for default or for risk, the granting authority not accepting any responsibility in this scope.
Article 30
Seizure
1 – Where the concessionaire commits serious infringements of obligations arising from the concession contract, the granting authority may take over, by means of seizure, the performance of activities and the provision of services the concession aims for.
2 – The seizure may take place, namely, in any of the following situations:
a) Total or partial cessation or interruption of the performance of activities and the provision of services the concession aims for;
b) Serious deficiencies in the regular development of the activities and services the concession aims for, as well as situations of insecurity of people and goods;
c) Deficiencies in the general state of premises, infrastructures and telecommunications equipment which could threaten the maintenance and/or the quality of the provision of services the concession aims for;
3 – Where any situation arises leading to the seizure of the concession, pursuant to the previous paragraphs, the non-compliance rectification process, provided for in paragraphs 2 and 3 of article 35, duly adapted, shall be complied with.
4 – The seizure having taken place, the concessionaire shall bear all costs arising from the maintenance of services and the extraordinary expenditures necessary to the reestablishment of a normal operation.
5 – Having ended the reasons leading to the seizure, and where the granting authority finds it suitable, the concessionaire shall be notified to resume the operation of activities and services the concession aims for, within the established time limit;
6 – Where the concessionaire does not want to, or cannot, resume the concession, or having done so, serious deficiencies remain in the operation of the activities and services the concession aims for, the granting authority may determine the immediate cancellation of the contract.
Article 31
Force majeure
1 – Where cases of force majeure prevent the compliance with the obligations of any of the parts or force the suspension of the concessionary services, during the period the concession contract is in force, the corresponding obligations or contract shall be suspended, totally or in part, for the period corresponding to the duration of the case of force majeure, or the contract shall be revised by agreement, where appropriate.
2 – As soon as a party acknowledges a case of force majeure, it shall notify in written the other party, presenting the effects regarding the performance of the contract.
3 - Without prejudice to the possibility of an agreement, pursuant to paragraph 1, in a case of force majeure, the concessionaire shall provide for the functioning and maintenance of the telecommunications services, taking the necessary and appropriate steps for the purpose, namely in the scope of planning and prevention of operation and human resources.
Article 32
Cases of war or crisis
1 – Without prejudice to the provision of paragraph j) of article 6 and to the preceding paragraph, in case of war or crisis, the granting authority, through the member of the Government responsible for the area of communications, has the power to manage and operate the services the concession aims for.
2 – During the period referred to in the preceding paragraph, the time limit for the concession stipulated in the contract is suspended, regarding all the aims of the concession.
CHAPTER XIV
Amendment and termination of contract
Article 33
Contract amendment
1 – During the period the concession contract is in force, where circumstances occur, the importance and effects of which may be considered as an irregular change of circumstances, pursuant to article 437 of the Civil Code, the parts shall revise the contract, in compliance with the principles of good faith and fairness.
2 - In the absence of an agreement between the parties concerning the contract amendment provided for in the preceding paragraph, within at the most 90 days from the notification of the changed circumstances from one of the parties to the other, the issue shall be submitted to a court of arbitration.
3 – Where the power provided in paragraph 2b) of article 14 is amended, it is incumbent upon the granting authority to compensate the concessionaire for the damages, costs or charges the concessionaire may bear as a result thereof.
Article 34
Contract termination
The concession shall terminate by means of an agreement between the granting authority and the concessionaire, cancellation, buy-back, or lapse of the respective period.
Article 35
Cancellation of the concession
1 – The granting authority may cancel the contract, without prejudice to the provision of paragraph 2, in cases of serious, continuous and non rectified or non rectifiable violation of the obligations of the concessionaire, namely where the following facts occur:
a) non-compliance with the obligations of the concessionaire pursuant to the concession contract;
b) violation of legislation applicable to the activity the concession aims for or of any of the clauses of the respective contract;
c) dissolution of the concessionaire;
d) unreasonable and repeated opposition to the supervision and reiterated and unjustified breaking of the legitimate determinations of the granting authority and ICP – ANACOM;
e) refusal to maintain and repair the premises and equipment which are infrastructures integrated in the basic telecommunications network;
f) refusal or inability of the concessionaire to resume the concession operation pursuant to paragraph 4 of article 30, or having done so, the situations which led to the seizure persist;
g) unjustifiable failure to comply with a final judgment or arbitration award;
2 – Having occurred one of the non-compliance cases that, pursuant to paragraph 1, justify the cancellation of the concession, the granting authority shall notify the concessionaire to comply fully with its obligations and rectify or amend the consequences of the its acts, save for a non rectifiable violation, within a reasonable time limit.
3 – Where the concessionaire does not rectify or amend the consequences of the non-compliance under the terms established by the granting authority, the latter may cancel the contract through a notification sent to the concessionaire.
4 – The cancellation is incumbent upon the member of the Government responsible for the area of communications, and shall be effective through a notification sent to the concessionaire, regardless of any other formalities.
5 – Where the cancellation of the concession takes place, the concessionaire shall compensate the granting authority for all damages caused, in addition to other penalties provided for under the law or the contract.
Article 36
Concession buy-back
1 – The granting authority may buy back the concession where justified on grounds of public interest, through a notification sent to the concessionaire, one year ahead of time at the least, and as from 15 years after the beginning of the respective period.
2 – The granting authority, having lapsed one year from the buy-back notification, shall take upon itself all the powers and obligations the concessionaire had entered into prior to the date of notification, in order to ensure the development of activities and the provision of services the concession aims for, and also the ones entered into by the concessionaire subsequently to that date, as long as they have been previously authorized by the granting authority.
3 – Where the buy-back takes place, the concessionaire is entitled to an extraordinary compensation corresponding to the number of years that lack for the end of the concession, multiplied by the average of the net results of the five years prior to the buy-back notification.
Article 37
Reversion of assets and rights at the end of the concession
1 – At the end of the concession, the assets of the private domain of the State shall revert free of charge and automatically to the granting authority, being incumbent upon the concessionaire to hand them over in perfect functioning, maintenance and security conditions, without prejudice to the normal wearing out due to the use, and free from any burden or charges, the concessionaire being prevented from invoking liens on any ground.
2 – Where the reversion of assets to the granting authority cannot be processed in the conditions provided for in the preceding paragraph, the concessionaire shall compensate the granting authority, the compensation being estimated under the law.
3 - At the end of the concession, the granting authority shall perform an inspection of the assets mentioned in paragraph 1, with the presence of a representative of the concessionaire, in order to assess the preservation and maintenance thereof, after which a report shall be prepared.
CHAPTER XV
Resolution of disputes
Article 38
Process of resolution of disputes
1 – The conflicts that may arise between the parties concerning the application, interpretation or integration of omissions of the concession contract shall be settled by a court of arbitration, pursuant to the following article.
2 – In case any matter is referred to the process of resolution of conflicts, the concessionaire shall not be exempted from the prompt compliance with the provisions of these bases and the determinations of the granting authority communicated within its scope, including the ones issued after the mentioned process has been started, nor shall it interrupt in any way the development of the activities the concession aims for, which shall continue under the terms in force at the date the process started, until a final decision is given regarding the process of resolution of conflicts as to the matter concerned.
Article 39
Court of arbitration
1 – Any of the parties may refer the dispute to a court of arbitration comprising three members, one designated by each of the parties in the process and a third one chosen by agreement between the arbitrators designated by the parties.
2 – The party that refers a dispute to a court of arbitration pursuant to the preceding paragraph shall present its reasons and designate immediately its chosen arbitrator in the application for the constitution of a court of arbitration to be delivered to the other party, by the dispatch by registered post, with a form for acknowledgment of receipt, the latter having to designate an arbitrator and to present within 20 working days from the reception of the application.
3 – The arbitrators designated pursuant to the preceding paragraph shall designate the third arbitrator within 10 working days from the designation of the arbitrator chosen by the respondent.
4 – In the absence of an agreement as to the designation of the third arbitrator, the choice shall be incumbent upon the president of the Lisbon Court of Appeal, at the request of any of the parties.
5 – The court of arbitration is constituted as from the date the third arbitrator accepts its designation and communicates this fact to the parties.
6 – The court of arbitration may be assisted by technical experts it deems suitable to designate, being advised in any case by individuals or entities with the appropriate judicial training in Portuguese Law.
7 – The court of arbitration shall judge according to the entitlement and its decisions shall be no longer subject to appeal, without prejudice to general law regarding the annulment of an arbitration award.
8 – The decisions of the court of arbitration shall represent the final decision of the process of resolution of conflicts and shall include the determination of costs and how these costs are to be allocated between the parties.
CHAPTER XVI
Final provisions
Article 40
Legislative references
The references to Portuguese, Community or international statutory instruments shall be deemed as references to substituting or amending legislation.
Article 41
Transitory provisions
1 – The sub-concession presently granted to the Companhia Portuguesa Radio Marconi, S.A., remains in force.
2 – The provision of the maritime mobile service shall be ensured by the concessionaire on a transitional basis, up to the respective transfer to a different entity, which shall occur within one year at the most from the entry into force of the amendment agreement of the concession contract.
3 – The concessionaire shall be compensated for the negative operating margins relating to the provision of the maritime mobile service, through the mechanisms provided for in article 21.
