Ministério das Obras Públicas, Transportes e Comunicações (Ministry for Public Works, Transport and Communications)
Decree-Law
The reorganisation and restructuring process of the communications sector in Portugal has been stimulated through several measures of legislative character or not; the last one has lead to the incorporation of Portugal Telecom, S.A., by means of a merge operation of Telecom Portugal, S.A., Telefones de Lisboa e Porto S.A. and Teledifusora Nacional, S.A.
PT has been incorporated with the aim to provide all public telecommunications services, including the international connections.
As it is said in the preamble of Decree-Law nr. 124/94 of 14 May, diploma which has set the framework for the merge operation, it was aimed with the latter to endow Portugal with an able telecommunications operator, with dimension and structure, to improve the quality and range of services to be provided to its users, stressing its competitivity either in the range of services, network or other levels, or in the provision of its commercial structure.
Since its foundation that took place on 23 July 1994, PT has provided the granted public service by the mentioned Decree-Law nr. 124/94, in particular under the provisions of its articles 3 and 14.
However, keeping in mind that PT is a company which capital is going to be partially privatised, it is imposed, now, to fulfil the provision of the Basic Law for the Establishment, Management and Exploitation of Infrastructures and Services of Telecommunications, specifying exactly the conditions under which the public telecommunications service, incumbent upon PT, should be provided with bases in the concession contract to be granted.
As a matter of fact, public service obligation is large; due to this, it is urgent to define its exact measure, reach and real contents, in an explicit way about own PT's set of rights and obligations, the provision expectations which are also deposit on PT's in order to find out how it will fulfil the purposes, in a salutary and total overture conditions, which are the reason for this incorporation.
The bases for public service concession, which by present diploma are now approved, establish then a clear defined framework not only for PT's exclusive operational areas, but either at telecommunications infrastructures level or at the services to be provided by PT, as well as the way as such infrastructures and services should be managed and provided.
Therefore, The Portuguese State, as grantor, had a particular concern to guarantee the quality and reliability levels in PT's provisions which will ensure citizen rights to users for the access and use of the services to be provided by concessionaire.
Hence, several generating mechanisms of the goals to be reached by PT and various parameters to be complied with were defined, in order to guarantee a healthy development of the public telecommunications network and a full range of services to be supported over it. By this way, it was looked for the continuity assurance of national capacity at telecommunications level which is quite modern and ensures the better quality in the wake, certainly, of the actual PT's provisions and as well as those provided by the former entities.
Other mechanisms of, namely, control and monitoring, were ensured in order to guarantee the fulfilment of the aimed objectives.
The approval of the present concession bases assumes also a particular significance, which in some extent consubstanciates the end of an exceptional chapter of national telecommunications development, always at State's charge through companies that were founded a long time ago for this purpose and that, more recently, have known how to prepare the re-order and restructure for the new era of open free market and service liberalisation.
So, due to all this, it is incumbent upon PT great responsibilities either due to the inheritance of a prestigious historical tradition or, above all, new challenges that PT will face and whose conditions to win them are given by the present bases.
Hence:
Under the terms of subparagraph a), of the nr. 1 of article 201 of the Constitution, the Government decrees as follows:
Article 1.
The bases of the public telecommunications service concession to sign with Portugal Telecom are herein approved, under the terms stipulated in the annex of the present diploma and which is an integral part of it.
Article 2.
The Minister of Public Works, Transports and Communications is authorised to grant, in Government's name, the concession contract of public telecommunications service.
ANNEX
Concession bases of the public telecommunications service
Section I
Definitions
Article 1
Definitions
For the purposes of the provisions of the present bases, one understands as:
a)Grantor - Portuguese State while holder of the establishment affected to the public telecommunications service;
b) Concessionaire - Portugal Telecom, S.A.
c) ICP - the Communications Institute of Portugal;
d)Basic Law - Basic Law for the Establishment, Management and Exploitation of Infrastructures and Services of Telecommunications (Law nr. 88/89 of 11 September);
e)Basic telecommunications network - infrastructures set defined in article 9, nrs 1 and 2 of Basic Law;
f)Integrated Services Digital Network (ISDN) - telecommunications infrastructure set which being an integral part of the basic telecommunications network, when fundamentally intended to provide the fixed telephone service, enables the provision of digital connections between two terminal points which supports a large range of telecommunications services, in accordance with the relevant recommendations of International Telecommunications Union (ITU), namely, the ITU Recommendation I.112;
g)Open Network Provision - set of technical conditions, supply and usage, underlying an open and efficient access to the basic telecommunications network;
h)Transport and broadcasting infrastructures - infrastructures affected to the emission, reception, transmission and distribution of broadcasting telecommunications;
i)Fixed telephone service or voice telephony - provision of addressed voice transport, on real time, with origin and destination on terminal points of the basic telecommunications network, enabling any user to utilise equipment connected to his terminal point to communicate with another terminal point;
j)Fixed telex service - provision of addressed telex messages transport, with origin and destination on terminal points of the basic telecommunications network, in accordance with the relevant ITU Recommendations, namely, Recommendation F.60 and using the international alphabet nr. 2 included in Recommendation S.1 and transmission at 50 Baud, enabling any user to utilise equipment connected to his terminal point to communicate with another terminal point; l) Leased lines service - provision of capacity on the basic transmission network, in a transparent mode, of temporary or permanent nature, which enables the telecommunication between two points, in accordance with the relevant ITU Recommendations, namely, for digital circuits, Recommendations G.703, G.704 and G.921 and, for analogue circuits, with Recommendations M. 1020, M. 1025 and M. 1040;
m)Fixed switched datatransmission service - provision of addressed data transport, with origin and destination in the fixed subscriber access system, enabling any user to utilise equipment connected to his terminal point to communicate with another terminal point;
n)Telegraph service - provision of a reception, transmission, reproduction and delivery service to the message addressee, in accordance with relevant ITU Recommendations;
o)Universal service - set of specific obligations inherent to the provision of public telecommunications service, aiming the satisfaction of the population needs in communications and social and economic activities in the whole national territory, under equal and continuous conditions and, also, by means of adequate remuneration conditions, taking into consideration the demands of an harmonic and balanced economic and social development;
p)Goods of public domain - telecommunications infrastructures that integrate the basic network and that, under Basic Law terms, belong to State public domain and which are affected to the concession;
q)User - any individual or collective person which has availability to the provided services by the concessionaire within the scope of the concession contract;
r)Cases of force majeure - any unexpected and insuperable event whose effects are produced independently of parties will or personal circumstances, namely, natural calamity situations, war acts, declared or not, public order alteration, economic blockade and fire.
Section II
Concession object and scope
Article 2
Concession object
1 - The concession object is:
a)Establishment, management and exploitation of the infrastructures which constitutes the basic telecommunications network;
b)Establishment, management and exploitation of the transport and broadcasting infrastructures of the telecommunications broadcast signal;
c)Provision of the following basic telecommunications services:
1) Fixed telephone service;
2) Fixed telex service;
3) Fixed switched datatransmission service;
d) Provision of the broadcasting service and distribution of the telecommunications broadcast signal;
e)Provision of the leased lines service;
f)Provision of the telegraph service.
2 - Besides the established in the preceding number and when the public interest duly reckoned justifies it, the grantor might entrust with the concessionaire the exploitation burden of other public telecommunications services under conditions to be agreed upon by both parties and which will be integrated as an amendment to the concession contract, preceded by the modification of the concession bases.
3 - Concession object does not include the radio sound and television activities defined as such under the Laws nrs. 87/88 of 30 June and 58/90 of 7 September.
Article 3
Concession scope
For the purposes of the concession object, should be granted to the concessionaire all rights and obligations included in the establishment, management and exploitation of the telecommunications and in the provision of telecommunications services contained in nr. 1 of article 2, within the national territory, ensuring the international connections.
Article 4
Regime of exploitation
1- An exclusive regime is granted to the establishment, management and exploitation of all and any telecommunications infrastructures, the provision of fixed telephone and telex services, the provision of leased lines service as well as the provision of telegraph service, stipulated in subparagraph a), of points 1) and 2) of subparagraph c) and subparagraphs e) and f) of nr. 1 of article 2 of present bases.
2 - From the provision of preceding number are excepted:
a)The infrastructures exclusively affected to the emission, reception and transmission of telebroadcasting services, when directly operated by duly qualified entities for the carry out of radio sound broadcast, defined as such in Law 87/88 of 30 July, or television defined as such in Law 58/90 of 7 September, within the scope and under the terms of the respective titles;
b)The infrastructures affected to private telecommunications when used under the legal terms;
c)The complementary telecommunications infrastructures when used under the legal terms.
3 - The economic exploitation in exclusive regime set forth under the terms of nr. 1 will stay in force whilst the grantor will not liberalise the activity or part of the activity, object of present concession, in accordance with the community right.
4 - Verified the restriction, limitation or loss of exclusives set forth under the terms of nr. 1, the concessionaire is still obliged to provide the correspondent services under the terms of universal service, ensuring all obligations which are incumbent upon it under the terms of the concession contract.
6 The establishment, management and exploitation of the transport and broadcasting infrastructures of the telecommunications broadcast signal as well as the provision of the broadcasting and distribution of the telecommunications broadcastsignal services, stipulated in subparagraphs b) and d) of nr. 1 of article 2, follows the regime set forth by Decree-Laws nrs. 401/90 of 20 December and 292/91 of 13 August.
7 - The switched datatransmission service mentioned in point 3) subparagraph c) is provided under the terms of the universal service, falling over the concessionaire the obligation of its direct or indirect exploitation, through incorporated entities by the latter and, in this case, when licensed for that purpose.
Article 5
Means affected to concession
1 - To the concessionaire is conferred the possession of the infrastructures which integrate the basic telecommunications network which are public domain goods, covering, namely:
a)Means which integrate the subscriber's fixed access system;
b)Means which integrate the transmission network;
c)Concentration, switching or processing nodes affected to the provision of fixed telephone and telex services mentioned in points 1) and 2) of subparagraph c) of nr. 1 of article 2.
2 - One considers also affected to the concession:
a)Concentration, switching or processing nodes affected to the provision of fixed switched datatransmission service mentioned in point 3) of subparagraph c) of nr. 1 of article 2;
b)Infrastructures for the emission, reception, transmission and distribution of telecommunications broadcasting;
c) Fixed assets where are built the concession's infrastructures;
d)Other fixed assets or parts of those where are installed the concessionaire services for the development of the granted activities;
e)Fixed assets used for the exploitation of the granted activities;
f)Rights and duties, object of legal relations which are found in any moment linked with the concession, concerning labour, mutual, contract works, leasing and service's provision.
Article 6
Concession's deadline
1 - The concession contract comes into force on the signature's date and it is valid for a 30 years period.
2 - The contract might be renewed successively for 15 years minimum periods, via a parties agreement, and if any of them is interested in the prorogation should notify the other, for that purpose, in a minimum anticipation of five years in relation to the end of the initial contract or of any of its renewals.
3 - If there is no agreement within a two years deadline, counted from the notice date mentioned in the preceding number, concerning the contract's renewal, the grantor reserves for itself the right to accompany, by representatives appointed by itself, the concessionaire's management, in order to ensure the full concession operation, being incumbent upon them, namely, the approval of the concessionaire's carry out or omission of the following acts:
a)Investment and correspondent financing, depreciation and revaluation;
b)Acquisition, alienation, or by any way, to burden the fixed assets and security values.
c)Technological and qualitative development of the network infrastructures, in order to ensure the quality of service indicators set forth under the terms of present bases.
4 - Verified the foreseen situation in the preceding number, the grantor also might, through its representatives, determine to carry out extraordinary investments in a way that guarantees a higher technological and qualitative development of the network infrastructures, in order to ensure the objective achievements not included under the terms of present bases.
5 - The extraordinary investments made under the terms of the preceding number will be object of a compensation corresponding to the differential between the realised extraordinary investment amounts reduced by the respective depreciation, accrued with an indemnification to be agreed between grantor and concessionaire.
6 - In case of conflict between grantor and concessionaire concerning the inherent values of the compensation and indemnification mentioned in the preceding number, its determination is incumbent upon a court of arbitration that is mentioned in article 44.
7 - The lack of approval by grantor's representatives of the foreseen acts in nr. 3 shall have as consequence a non assumption of the respective obligations by the State.
Article 7
Concessionaire other services and activities
1 - Besides the granted services, the concessionaire might, in Portugal and abroad, provide other telecommunications services, as well as carry out any other complementary, subsidiary or accessory activities related with the concession's object, directly or through society's incorporation or participation.
2 - Service's provision and the activity carry out mentioned in the preceding number should not affect the compliance of concessionaire's obligations consigned in the concession contract and, if this is the case, those will be governed by the respective concessions, licenses or authorisations and moreover applicable regulation.
Section III
Concessionaire's obligations
Article 8
Concessionaire's generic obligations
1 - By this concession contract the concessionaire undertakes the following generic obligations to:
a) Guarantee the provision of public telecommunications services granted under the terms of a universal service, for the whole national territory, and for these as well as for broadcasting service it should not show any preference or discrimination, unduly or unjustified, relating to any individual or collective person who has applied for them;
b) Provide the granted services, ensuring their interworking, continuity, availability and quality;
c) Guarantee and enforce the communications confidentiality made through the provided services, as well as the inviolability of the support infrastructures;
d) Guarantee the equality and transparency in the access and use of its services by other telecommunications operators duly licensed or authorised for the provision of telecommunications services by means of an adequate remuneration, defined under the law and contract conditions;
e) Comply with the numbering plan related with the granted services, under the terms set forth by ICP;
f) Make available and send to ICP the information and statistical data, considered necessary, by the latter, to follow-up the carried out activities within the concession scope;
g) Permit and facilitate the grantor's monitoring of contract concession execution, under the terms of article 23.
h) Not cede, alienate or burden, at any title, the emerging rights from the concession, except for these cases foreseen in the law or duly authorised;
i) Be or become owner of buildings or part of those where infrastructures are installed which under the terms of article 5 are affected to the concession;
j) Comply with the prevailing normal laws, in their applicable parts, the orders, injunctions, commands, directives and instructions that, under the law terms, are directed to it by the competent authorities, as well as the determinations that under the terms of the concession contract are addressed to it by the grantor.
l) Comply with the norms that in the future will come into force, even though those lapse provisions arising from public use necessities or demands of any of the provided services not foreseen at concession's date;
m) Guarantee, in a capable and adequate way, the operation of the telecommunications services during crisis, emergency and war situations;
n) Guarantee and ensure the existence of information services, commercial assistance, complaints and repair notices, in accordance with the necessities of the public use services;
o) Ensure the distribution of directories of the provided services or equivalent support, to service users, in accordance with the rules mentioned in the respective regulations which moreover include the information related to public utility services and with others public telecommunications services to whom should be guaranteed equal conditions of access and non discrimination.
2 - For the purposes of the provision of subparagraph c) of the preceding number, the concessionaire undertakes the obligation to take all necessary and appropriate steps within its reach to ensure and enforce the inviolability of the telecommunications network at its own charge and the communications confidentiality, under the terms of the legislation in force, not deriving, however, for the latter any responsibilities from deeds or omissions which could not be accountable for.
3 - The concessionaire's workers undertake the obligation of not revealing the contents of the conversations or other information that, due to their job functions, have taken acknowledgement, except for the cases legally accepted.
4 - The information services mentioned in subparagraph n) of nr. 1 involve, namely, the direct indication to users of data concerning the subscribers of services whenever identified and recorded in directories or, when not being listed in them, this is not verified due to a concessionaire's error or omission.
Article 9
Specific obligations within the scope of basic infrastructures network
and transport and broadcasting infrastructures
1 - Concessionaire's obligations, within the domain of establishment, management and exploitation of infrastructures which constitute the basic telecommunications network, are:
a) Establish and maintain in good work, safety and maintenance conditions the basic network infrastructures, as well as to zeal for its operation and adequate exploitation;
b) Develop, qualitative and quantitatively, the basic telecommunications network infrastructures, fulfilling, namely, the objectives which will be set forth in the convention mentioned in article 21, in order to assure the adequate quality levels to the services supported by them;
c) Make available to, under the law terms, authorised entities for the activity discharge of cable television network distribution operator, in equal and non discriminatory conditions, the access to telecommunications infrastructures which are object of the present concession and needed for the carry out of their activities.
2 - Concessionaire's obligations, within the domain of establishment, management and exploitation of transport and broadcasting of telecommunications broadcasting infrastructures defined as such in subparagraph h) of article 1, are to:
a) Ensure to, under the law terms, the concessionaire entities of radio broadcasting, sound and television, public service and to other licensed entities for the exercise of radio broadcasting, sound and television, in equal and non discriminatory conditions, the access to transport and broadcast signal networks necessary to the respective coverage;
b) Develop, qualitative and quantitatively, the mentioned infrastructures in the preceding subparagraph, in order to assure the awarded quality levels.
Article 10
Specific obligations within the fixed telephone service scope
1 - Concessionaire's obligations, within the domain of fixed telephone service, mentioned in point 1 of subparagraph c) of nr. 1 of article 2, are:
a) Guarantee the service provision under the terms set forth in the respective regulations and moreover legislation in force;
b) Guarantee the equal access to the service by the public in general and should not show any preference or exercise any discrimination, unduly or unjustified, towards any singular or collective person who have applied for it;
c) Assure the service provision to the public in general ensuring its interconnection and interworking with public telecommunications services provided by other operators when requested by them, whenever technically feasible and whenever the technical access specifications are met;
d) Adopt measures which ensure the service access, in more favourable economic conditions, to citizens with less economic resources, namely, the retired and pensioners, in accordance with rules to be set up in the convention to be signed under Decree-Law nr. 207/92 of 2 October;
e) Introduce a set of service features and conditions to ease its operation by the users in general and provide an adequate exploitation;
f) Establish measures which ensure a better use of the service by citizens with special needs, making available the appropriate terminal equipment, when applied for by the interested party and under remuneration conditions to be established in the convention, under the terms of Decree-Law nr. 20/92 of 2 October;
g) Ensure, whenever technically feasible and under the terms of the applicable legislation, the offer of a minimum set of technical features and advanced resources;
h) Guarantee the demand satisfaction and the qualitative characteristics of the service's provision.
i) Make available simple telephone terminal equipment to access the service, as well as to ensure its installation and maintenance when expressly requested by the interested party and under an adequate remuneration;
j) Guarantee, by means of a national help number defined in the national numbering plan, the access to the different emergency systems, under the terms stipulated in the applicable legislation.
2 - Concessionaire undertakes the obligation to ensure the installation and maintenance of public payphones to access the fixed telephone service, under the terms of the respective regulations; it should comply with the correspondent standards and quality of service indicators, in order to guarantee the satisfaction of user's needs either in quantity or in geographic distribution; it should also comply with the minimum installation quantities to be defined under the terms of article 21.
3 - Concessionaire undertakes also the obligation to adopt measures which ensure a better use of the service by citizens with special needs, namely, it should adequate the installed structures in the public streets where are built public payphones, in order to ensure its easy access.
4 - The contents of obligations mentioned in subparagraphs e), g) and h) of nr. 1 is made real in the convention referred in article 21 and under the terms which will be stipulated in it.
Article 11
Specific obligations within the fixed telex service scope
1 - Concessionaire's obligations, within the domain of fixed telex service, mentioned in point 2 of subparagraph c) of nr. 1 of article 2, are:
a)Guarantee the service provision under the terms set forth in the respective regulations and moreover legislation in force;
b)Assure the service provision to the public in general ensuring its interconnection and interworking with public telecommunications services provided by other operators when requested by them, whenever technically feasible and whenever the technical access specifications are met;
c)Guarantee the demand satisfaction and the qualitative characteristics of the service's provision, under the terms to be set forth in the convention mentioned in article 21.
2 - Concessionaire undertakes also the obligation to ensure the installation and maintenance of public payphones to access the fixed telex service, under the terms of the respective regulations; it should comply with the correspondent standards and quality of service indicators, in order to guarantee the satisfaction of user's needs either in quantity or in geographic distribution.
Article 12
Specific obligations within the fixed switched datatransmission service scope
1 - Concessionaire's obligations, within the domain of fixed switched datatransmission service, mentioned in point 3 of subparagraph c) of nr. 1 of article 2, are:
a) Guarantee the service provision under the terms set forth in the respective regulations and moreover applicable legislation;
b) Ensure, in equal and non discriminatory conditions, the provision to the public in general, packet switching datatransmission services with technical characteristics harmonised in accordance with applicable recommendations, ensuring its interconnection and interworking, whenever technically feasible, with public telecommunications service provided by other operators, when requested by the them and whenever the technical access specifications are met;
c) Ensure, under the terms of applicable legislation, the minimum set and technical characteristics of network access interfaces, as well as the provision conditions, to be established in the convention mentioned in article 21;
d) Guarantee the service's provision, in a continuos way and complying with standards and quality indicators, under the terms which will be stipulated in the convention mentioned in article 21;
Article 13
Obligations within the broadcasting
Obligations within the broadcasting and distribution of the telecommunications broadcast signal service
1 - Concessionaire's obligations, within the domain of broadcast and distribution of the broadcast telecommunications signal service, mentioned in subparagraph d) of nr. 1 of article 2, are:
a)Ensure, in equal and non discriminatory conditions, the broadcasting of the telecommunications broadcast signal of licensed operators which have applied for it;
b)Ensure the broadcast of the public television service, under a remuneration to be set forth in a specific convention, under the terms of nr. 1, article 17 of Decree-Law nr. 122/94 of 14 May;
c)Guarantee, under the terms stipulated in Decree-Law nr. 401/90 of 20 December, to television operators the broadcasting of their signals, in accordance with coverage phases and deadlines.
Article 14
Specific obligations within the leased lines service scope
1 - Concessionaire's obligations, within the domain of leased lines service provision, mentioned in subparagraph e) of nr. 1 of article 2, are:
a) Guarantee the service's provision under the terms of applicable legislation;
b) Make available leased lines, either in transmission network, including those offered via satellite telecommunications systems, or in subscriber's fixed access system, necessary for the provision of public telecommunications service, provision of telebroadcasting service, when the latter uses the basic telecommunications network, as well as those intended for the setting up of private networks;
c) Ensure, under the terms of applicable legislation, the leased lines provision, in accordance with the different types, technical features and provision conditions;
d) Guarantee the demand satisfaction and the qualitative characteristics of the service's provision, under the terms to be set forth in the convention mentioned in article 21.
2 - Without prejudice of the stipulated in subparagraph c) of the preceding number, the grantor and concessionaire might, in the convention mentioned in article 21, agree over the provision of other kinds of leased lines or more favourable conditions for the users.
Article 15
Specific obligations within the telegraph service provision service
1 - Concessionaire's obligations, within the domain of telegraph service provision, mentioned in subparagraph f) of nr. 1 of article 2, are:
a)Guarantee the service's provision under the terms of applicable legislation;
b)Guarantee the demand satisfaction and the qualitative characteristics of the service's provision, under the terms to be set forth in the convention mentioned in article 21.
Article 16
Concessionaire's specific obligations within the scope of fixed telephone and switched datatransmission services provided via ISDN
Concessionaire's obligations, within the scope of fixed telephone and switched datatransmission services via ISDN:
a)Guarantee the access to provided services via ISDN, under the terms of applicable legislation;
b)Ensure the harmonised options to ISDN access, as well as the minimum set of basic offers and additional offers, under the terms to be set forth in the convention mentioned in article 21.
Article 17
Free of charge provisions
1 - Concessionaire undertakes the obligation to provide, free of charge, the following provisions:
a)Use of national help number;
b)Access to information services, whenever involves data concerning subscribers not listed in directories due to concessionaire's error or omission, as well as to fault repair services and complaints;
c)Publication and distribution of subscriber directories of fixed telephone and telex services;
d)Other provisions which have interest for the public in general, and as such, established in the convention to signed under the terms of Decree-Law nr. 207/92 of 2 October.
2 - Besides the stipulated in the preceding number, concessionaire undertakes the obligation to provide, free of charge, the public telecommunications service objec of concession to President of Republic, Prime Minister, President of Supreme Justice Court, President of Constitutional Court, President of Supreme Administrative Court, President of Supreme Military Court, President of Accounts Court, Government Members, Republic Attorney General and Justice Purveyor.
Article 18
Quality of services
1 - Concessionaire undertakes the obligation to provide the granted services according to standards and quality indicators to be set forth under the terms of article 21.
2 - Concessionaire should quarterly send to ICP the data that will enable it to estimate with efficiency the quality of service indicators, in accordance with methods and technical means defined for the respective computation and as such set forth under the terms of the preceding number.
Article 19
Accounting
1 - Concessionaire undertakes the obligation to implement an annual accounting system, under the following terms:
a)Until 1995, the analytical accounting system should enable the direct and indirect costs computation of each provided services, as well as, for each one of them, the costs associated to each provision way;
b)Until 1998, the analytical accounting system should additionally enable the split between costs associated to services provision and those associated to infrastructures management and exploitation.
2 - It is incumbent upon ICP the approval of methodology to be used in the implementation and usage of the system mentioned in the preceding number.
3 - When, under the terms of nr. 1 of Article 7, the concessionaire provides other services in a direct way, the latter should ensure the adequate account segregation of revenues and costs, as well as connected assets and liabilities.
Article 20
Concessionaire's inventory
1 - Concessionaire undertakes the obligation to prepare and keep updated a patrimony inventory affected to concession which should contemplate, namely, the perfect distinction between public domain goods mentioned in subparagraphs a), b) and c) of nr. 1, Article 5 and moreover goods affected to concession, in accordance with rules to be defined by ICP.
2 - The inventory mentioned in the preceding number is yearly approved by ICP.
3 - In case of non approval, the inventory process will be submitted to a court of arbitration for decision.
4 - Without prejudice of other penalties which are liable, in the non fulfilment case stipulated in nr. 1, the grantor reserves for itself the right to proceed with an inventory of the goods affected to concession and the incurred costs will be at concessionaire's expenses.
Article 21
Objectives for basic telecommunications network infrastructures development,for minimum service's provision and standards, and for quality indicators.
1 - By a convention it will be set up between ICP and concessionaire:
a) Objectives for basic telecommunications network infrastructures development as well as switching and data processing nodes;
b) Objectives of minimum service's provisions, with technical features and advanced resources; c) Standards and quality indicators for provided services, as well as, methods and technical means for the respective determination.
2 - Objectives, in addition to standards and quality of service indicators mentioned in the preceding number, will be set up for each convention validity year.
3 - The convention mentioned in present number is signed for a minimum three years period and comes into force as from the date of its ratification by grantor which will be an integral part of concession contract.
4 - Expired the convention validity period and until the signature of a new convention, concessionaire undertakes the obligation to ensure, as a minimum, the evolution trend of the established objectives and indicators, without prejudice to, in the absence of an agreement and initiative of any of the parties, be incumbent upon the court of arbitration foreseen in Article 44 the settlement of new objectives, standards and quality of service indicators mentioned in nr. 1.
Article 22
Development plan
1 - In order to enable the verification by the monitoring entity the perfect adequacy between the infrastructures and services development and technological development and quality of service levels set forth under the terms of the preceding number, as well as the subsequent modifications that will eventually be established, the concessionaire undertakes the preparation, until the 3rd quarter of each civil year, a development plan for the three following years, where are established the objectives to be pursued for the extension of the infrastructures and networks under its management and exploitation, as well as the services the object of present concession.
2 - The development plan mentioned in the preceding number, should contemplate, for every year, the following objectives:
a)Concerning infrastructures telecommunications installation, management, and exploitation:
i)Installed capacity in terms of subscriber's access;
ii)Installed transmission capacity, detailing and quantifying the transmission means to be used, namely, concerning the support;
iii)Switching, concentration and processing nodes, detailing its technologies and capacities;
iv)Introduction of new technologies in the network exploitation, management and maintenance, quantifying the associated consequences;
b)Concerning services provision, object of this concession:
i)Introduction of new service facilities and improvement of quality of the provided services.
ii)Access advances in the provided services by citizens' side with special necessities;
3 - The objectives mentioned in the preceding number should be detailed by geographic areas, in order to show an adequate provision harmonisation on the national territory.
4 - The development plan should include the quantification and valuation of the necessary investments to its realisation, distinguishing, namely between network expansion investments and those for network replacements.
Article 23
Concession monitoring
1 - Concession monitoring is incumbent upon Minister of Finance, for the financial matters, and Minister of Public Works, Transports and Communications, for the others.
2 - For the purposes of the mentioned in the preceding number, the concessionaire should provide to ICP all determined collaboration, undertaking the faculty to access its premises, equipment of any nature, all documentation and archives, to provide all information and to make available all and any requested elements, namely, the used statistics and management records, and to provide all the requested clarification about these documents.
3 - Under ICP's request and in the presence of concessionaire's representatives, tests might be made to enable the evaluation of, either the operation, safety and infrastructures maintenance conditions and moreover goods affected to concession or the provided quality levels of the different services object of this concession.
4 - ICP's determinations which will become issued within its monitoring powers scope are immediately applicable and bound the concessionaire, without prejudice of the recourse to the disagreement resolution process foreseen in Article 43.
5 - ICP and also its agents undertake the obligation to keep confidential all collected information, namely that of commercial nature, within the developed monitoring actions scope, and should not be used or divulged for other different purposes from those of the own monitoring action or other which the law considers relevant.
6 - When the concessionaire has not respected the determinations issued by ICP within its monitoring powers scope, ICP has the faculty to proceed with the fixing of the situation, directly or through a third party, at concessionaire's own expenses.
Article 24
State's Income
1 - Concessionaire undertakes an annual payment to State of, as a rent by the establishment, management and exploitation of granted infrastructures, an amount equivalent to 1% of the gross revenues arising from the service exploitation which is the object of present concession.
2 - The payment of the rent will be made in the following month to the accounts approval concerning the prior civil year exercise.
3 - By a joint administrative ruling of Minister of Finance and Government member responsible for the communications area will be set up the percentage of the rent amount which will be given to ICP as:
a)Counterpart to associated costs with concession control and monitoring, in addition to inherent charges to grantor's representation in the telecommunications international organisations;
b)Participation in expenses arising from execution and installation of the civil planning system of emergency communications.
4 - The negative exploitation margins eventually arising from the fulfilment of obligations concerning the universal service provision and determined in accordance with the stipulated in the following article will be subtracted from the annual rent amount.
5 - The amounts related with exemptions and reductions concerning the granted services and arising from applicable regulatory provisions and as such set forth in the convention to be signed under the terms of Decree-Law nr. 207/92 of 2 October could also be subtracted from the annual rent amount.
Article 25
Determination and compensation of universal service costs
1 - The negative exploitation margins eventually arising from the fulfilment of obligations concerning the universal service provision under the terms of article 4 will be compensated, without prejudice of the adoption of safeguard means which could be established within the community policy scope applicable to the universal service, in case of approval, alternate or cummulatively, in the following ways:
a)Through tariff systems actually in force;
b)Through community funds arising from safeguard means which could be established within the community policy scope applicable to the universal service, made available or to be available from grantor in accordance with the respective programs;
c)Trough the deduction of the respective amount of the rent to be paid by concessionaire to State;
d)Through the compensation fund foreseen under the terms of Article 32.
2 - For the purposes of the mentioned in the preceding number, the concessionaire should, as complement and simultaneously with the development presentation stipulated in Article 22, specifically demonstrate the associated costs to the universal service provision and submit them to the approval of a committee including ICP's and concessionaire's representatives, which will have to pronounce about it in a 30 days deadline.
3 - In the case of approval, concessionaire should adapt its accounting to a perfect follow up and demonstration of revenues and costs associated to universal service provision.
4 - In case of non-approval, namely by disagreement between committee and concessionaire, ICP shall promote a consultation to existing telecommunications operators in the market, in view to choose an operator which, satisfying the same universal service level and degree of obligations, offers economic conditions more favourable to grantor.
5 - In the cases mentioned in the preceding number, the entity undertaking the obligation to provide a universal service is compensated for the associated costs for that provision, under the terms of nr. 1.
6 - In the case of non-existence of alternate operators which, under the terms of nr. 4, ensure the service provision or while the exclusives included in Article 4 are in force, it is incumbent upon the court of arbitration to decide over the negative exploitation margins, in the case of non-approval by the committee under the terms of nr. 2.
Article 26
Decisions subjected to authorisation
The concessionaire shall not, without grantor's express authorisation, take any social decision which, direct or indirectly, has the end or could lead to one of the following situations:
a)Modification of the company's object;
b)Change, merge, split or dissolution of the company;
c)Reduction of the share capital;
d)Suspension or cession, temporary or permanently, total or partially, of any of the granted services or those which is obliged to provide under the terms of present bases;
e)Alienation of financial participation in company incorporated for services provision foreseen in nr. 7 of Article 4.
Article 27
Sub concession
1 - It is allowed to concessionaire, by means of a grantor's previous authorisation, sub concession in the whole or in part, the exploitation of one or some services object of present concession, as well as the respective telecommunications infrastructures.
2 - In the cases where the sub concession is authorised, the concessionaire maintains its rights and continues, direct and personally, bound to the obligations arising from the concession's contract.
Article 28
Participation of third parties in the activity
1 - Without prejudice of stipulated in nr. 7 of Article 4, the object of present concession will be always pursued, direct and personally, by concessionaire, needing the latter always and in any case the grantor's previous authorisation for the adoption of any juridical instrument types which enable third parties, direct or indirectly, to participate, in any way, in the exercise of the concession own activities.
2 - In the case of the authorisation mentioned in the preceding number, concessionaire maintains its rights and continues, direct and personally, bound to the obligations arising from the concession's contract.
Section IV
Concessionaire's rights
Article 29
Concessionaire's rights
Concessionaire, by the concession contract, is expressly invested with the following rights to:
a)Exploit the concession under the terms of present bases;
b)Collect the prices of provided services;
c)Proceed, in accordance with law and under the terms of stipulated in subparagraph f) of nr. 1, Article 3 of Decree-Law nr. 445/91 of 20 November, with forgo of municipal licensing, with constructions and works necessary to the implementation, preservation and maintenance of the telecommunications infrastructures affected to concession or to the construction, remodelling and preservation of buildings affected to them;
d)Apply for expropriations due to public utility, apply for the constitution of administrative easements, establish protection areas and accede to public and private lands and buildings, whenever it is necessary for the granted services exploitation and with compliance to legislation in force;
e)Occupy and use, under the law terms, the streets, squares, roads, paths and water courses, in addition to lands along railways and of any communication roads of public domain, with total tax and any other charges exemption, whenever it is necessary for the implementation of telecommunications infrastructures or for the crossing of different installation parts or equipment necessary to the exploitation of the concession's object;
f)Use radio electrical frequencies necessary for services provision object of present concession and which have been assigned by ICP.
Article 30
Price system
1 - Price system for the telecommunications services provided in exclusive by concessionaire is based in the following principles:
a)Cost-orientation for the service provision, duly justified by an analytical accounting system;
b)Non-discrimination in its application, ensuring that to all users in equal circumstances are conferred an equal treatment;
c)Uniformity in the application of the tariff regime in force for the services object of concession.
2 - The provided service prices in exclusive regime are established by a convention signed with respect for the principles described in preceding number between concessionaire and State, under the terms of Decree-Law nr. 207/92 of 2 October, intended to be in force, except otherwise from parties, during three years periods,.
3 - For the purposes of mentioned in the preceding number, the convention should include rules which condition global price variations of each service, including, for each service, an association to the achievement degree of quality of service global indicator (IQGS), calculated as a function of the different applicable quality of service indicators (IQS), in addition to the realisation degree of the development objectives concerning basic telecommunications network infrastructures, switching and data processing notes, as defined under the terms of Article 21.
4 - Within convention's scope, concessionaire undertakes to submit a plan from which arises the adequacy of its financial structure to the principles mentioned in nr. 1, namely in what concerns the geographic delimitation of price zones taking into consideration parameters of standardisation and economic rationality.
5 - In case of restriction, limitation or loss of exclusives, the set forth prices remain in force until the agreement signature to be established between grantor, represented by ICP and Direcção Geral da Concorrência e Preços, and concessionaire, where are included the rules leading to the setting up of new applicable prices to the public telecommunications service object of present concession in accordance with the rules laid down in preceding numbers.
6 - In the absence of the agreement mentioned in the preceding number, the parties may submit that settlement to a court of arbitration.
7 - The provision of the broadcast and the distribution of telecommunications broadcast signal service is levied with the payment of an access rate to be set up by a specific convention, to be established under the terms of nr. 1, Article 17 of Decree-Law nr. 122/94 of 14 May.
Article 31
Remuneration due to interconnecting services with other public telecommunications service operators.
1 - Concessionaire should be remunerated by the interconnecting services object of the concession with the services provided by other public telecommunications operators, namely in what concerns the traffics which are latter revenues and flow in its network.
2 - The rules for the establishment of the remuneration amount mentioned in the preceding number are set up and updated under the terms of a convention to be signed under Decree-Law nr. 207/92 of 2 October, or the agreement mentioned in nr. 5 of the preceding Article.
Article 32
Compensation fund of universal service provision
The negative exploitation margins eventually emerging from the universal service provision, when approved, might be compensated through a compensation fund of universal service provision, for which the concessionaire and other telecommunications operators will participate, under the terms which will become set up by special legislation which will regulate the services object of the present concession and which will constitute a concessionaire exclusive by other telecommunications operators side.
Section V
Contract non-fulfilment
Article 33
Contractual fines
1 - Without prejudice of the non-fulfilment situations which might give origin to a concession embargo or rescission under the terms of Articles 35 and 40, the non-fulfilment by the concessionaire of the arising obligations from concession or of grantor's determinations issued under the law terms or concession's contract will be levied by ICP with contractual fines of a variable amount between a minimum of 0,001% and a maximum of 0,5% computed over the annual revenue volume realised in the prior civil year, according to the seriousness of the committed infractions, of the damages arose from them, in addition to concessionaire's guilt.
2 - The fines mentioned in the preceding number are levied by an ICP Board of Directors decision, which should be communicated by writing to concessionaire, bringing forth its effects independently of any other formality.
3 - The levied fine amounts under the terms of present Article will return to the State in 60% and to ICP in 40%.
4 - The payment of the levied fines under the terms of present Article should not exempt the concessionaire from civil responsibility by losses and damages arising from the infraction.
5 - Without prejudice of the application of rules which restrict price variations arising from nr. 3 of Article 30, in case of non-compliance with the realisation degree of objectives and standards and quality indicators of the services set forth under the terms of Article 21, is still applicable the provision of present Article.
Article 34
Extra contractual responsibility
Concessionaire will respond, under the general law terms, for any caused damages to third parties during the exercise of its activities which constitute the concession's object, by guilt or by risk not being assumed by grantor of any kind of responsibility within this scope.
Article 35
Embargo
1 - In case of serious non-fulfilment by concessionaire of the arising obligations from concession's contract, the grantor might through embargo take over the development of the services activities and exploitation which are object of the concession .
2 - Embargo will take place, namely when it is verified any of the following situations:
a)Total or partial suspension or interruption of the development of the services activities and exploitation which are object of the concession;
b)Serious deficiencies in the regular development of the services activities object of the concession, in addition to unsafe situations of people and goods;
c)Deficiencies in the installations, infrastructures and telecommunications equipment general state which could jeopardise the continuity and or the quality of the provided services object of the concession.
3 - Under embargo, the concessionaire will support all charges arising from maintenance services and the extraordinary expenses necessary for the re-establishment of the normal exploitation.
4 - As soon as disappear the reasons which motivate the embargo and the grantor considers it opportune, concessionaire will be notified to take over, within the determined deadline, the normal exploitation of activities and services object of concession.
5 - If concessionaire should not want to or could not resume the concession or, when it has been done, serious deficiencies in the exploitation of activities and services object of concession continue to be verified, the grantor might determine the immediate contract termination.
Article 36
Force majeure
1 - If, during the concession's contract validity, cases of force majeure are verified which hinder the obligations fulfilment of any parts or oblige to the suspension of the granted services, there is place for suspension, total or partial, of the corresponding obligations or contract during the period corresponding to the case of force majeure duration or to the contract revision, by an agreement, when that is justified.
2 - The party which intend to invoke case of force majeure should, as soon as has acknowledge it, given notice by writing to the other, indicating its effects in the contract execution.
3 - Without prejudice of the possibility of an agreement foreseen in nr. 1, in a case of force majeure, concessionaire shall always be aware of, taking the measures which seem necessary and adequate for that purpose, namely in the domain of planning, operation and human resources prevention which enable the assurance of the operation and continuity of the telecommunications services.
Article 37
Cases of war or crisis
1 - Without prejudice of the stipulated in subparagraph m) of nr. 1, Article 8 and preceding Article, in case of war or crisis the grantor, through the Government member responsible for the communications area, reserves for itself the right to manage and exploit the services object of concession.
2 - During the referred period in the preceding number, the concession deadline stipulated contractually is suspended in relation to the whole concession's object.
Section VI
Contract modification and extinction
Article 38
Contract modification
1 - During the concession's contract validity, in the event of occurring circumstances which, by its importance and effects, should be considered as an abnormal modification of circumstances, under the terms of Article 437 of Civil Code, the parties commit themselves to revise the contract in accordance with the good faith and equity principles.
2 - In the absence of an agreement between the parties concerning the contract modifications foreseen in the previous number within a deadline not higher than 90 days counted as from the notice of modification of circumstances, from one of the parties to the other, there will be a recourse to a court of arbitration.
Article 39
Concession extinction
The concession extinguishes itself by an agreement between grantor and concessionaire, by rescission, by redemption and by the lapse of the respective deadline.
Article 40
Concession termination
1 - Concessionaire might terminate the concession, without prejudice of stipulated in nr. 2, in cases of serious, continuous and without remedy or incurable breach of concession obligations, namely due by observation of following facts:
a)Shift from concession's object
b)Breach of applicable legislation to the activity of concession's object or of any clauses of the respective contract;
c)Dissolution of concession,
d)Unfounded and repeated hostility towards monitoring and reiterated and unjustified disobedience to legitimate grantor or ICP's determinations;
e)Refusal to duly proceed with maintenance and repair of premises and equipment which are infrastructures integrated in basic telecommunications network;
f)Concessionaire's refusal or impossibility to take again the concession' s exploitation under the terms of nr. 5, Article 34, or when having done it, the situations which caused the embargo still prevail;
g)Culpable non fulfilment of arbitrage or judicial decisions.
2 - In the event of one of those non fulfilment cases that, under the terms of nr. 1, causes the concession's termination, grantor will notify the concessionaire to, within a reasonable fixed deadline, integrally fulfil its obligations and to correct or repair the consequences of its acts, except when dealing with a incurable breach.
3 - If concessionaire should not promote the correction or repair of the non fulfilment consequences under the terms determined by grantor, the latter might terminate the concession, by means of a notification sent to concessionaire.
4 - The termination is incumbent upon the Government member responsible for the communications area and brings forth effects by means of a notification to concessionaire, independently of any other formality.
5 - In the termination case, the universality constituted by all goods and rights affected to concession returns to State, without any compensation and without any prejudice of civil responsibility which concessionaire could incur and of the sanctions foreseen in the law or in the contract.
Article 41
Concession redemption
1 - Grantor might redeem the concession whenever causes of public interest justifies it, by means of a notification to concessionaire with an advance notice of at least one year, after elapsed at least 15 years counted from the beginning date of the respective deadline.
2 - Grantor will assume, elapsed one year period over redemption notification, in order to ensure the pursuance of the activities concerning the establishment, management and exploitation of the infrastructures which constitute the basic telecommunications network and the provision of the granted services, and also those which have been previously authorised by grantor, being in this case applicable, with duly adaptations, the stipulated in nr. 3 of Article 6.
3 - In the redemption case, concessionaire will have the right to a compensation equal to goods value which, at redemption's date, constitute the infrastructures of the basic network and moreover goods affected to concession since included in the respective infrastructures development plan supported by the concessionaire, corrected by the respective depreciation and revaluation, subtracted of 1/25 for each elapsed year from the beginning of concession's deadline.
4 - Besides the compensation foreseen in the preceding number, concessionaire has the right to an extraordinary compensation corresponding to the number of years which lack for the expiration of concession's deadline, multiplied by the average amount of the net results obtained in the five years prior to the redemption notification.
Article 42
Return of goods and rights at end of the concession
1 - At the end of concession, the universality of all goods and rights affected to concession under the terms of Article 5 returns free of charge and automatically to grantor; concessionaire undertakes its delivery in perfect conditions of operation, maintenance and safety, without prejudice of the normal wear arising from its use, and free from any burden or charges and the concessionaire should not invoke, with any bases, the retention right.
2 - Should the goods and rights return to grantor not occur in accordance with the conditions foreseen in the preceding number, concessionaire shall compensate the grantor and the compensation will be computed under legal terms.
3 - At the end of the concession, the grantor will make an inspection to the goods mentioned in nr. 5, in which will participate a concessionaire's representative, intended to check the preservation and maintenance state of those goods and should be drawn up an act of the realised inspection.
Section VII
Resolution of disagreements
Article 43
Conflict resolution process
1 - The eventual conflicts which could arise between parties concerning application, interpretation matters or integration of holes of the concession contract shall be resolved by voluntary arbitrage, under the terms of Law nr. 31/86 of 29 August.
2 - The submission of any matter to the conflict resolution process should not exonerate the concessionaire from the sharp fulfilment of provisions of the present bases and grantor's determinations which within its scope have been noticed, including the issued after that submission date, neither allows any interruption in the development of the activities object of concession, which should continue to be processed under the terms in force until a final decision is taken in the resolution process of disagreement in regard to the matter in question.
Article 44
Court of arbitration
1 - Any of the parties may submit the disagreement to a court of arbitration composed by three members, one appointed by each party and the third one chosen by a common agreement of the judges appointed by both parties.
2 - The party which has decided to submit a certain disagreement to court of arbitration under the terms of the preceding number shall present its bases and will designate immediately its own judge for the constitution of the court of arbitration in the application addressed to the other party via a registered letter with reception notice; the latter should appoint its own judge and draw its own defence, within a 20 days deadline counted from the reception date of that document.
3 - The judges appointed under the terms of the preceding number shall appoint the third judge of the court of arbitration within a 10 days deadline counted from the judge appointment by the defendant party.
4 - In the lack of agreement concerning the designation of the third judge, the choice will be made by the president of Tribunal da Relação de Lisboa, at the request of any of the parties.
5 - The court of arbitration is considered constituted on the date when the third judge accepts his own appointment and communicates it to both parties.
6 - The court of arbitration might be assisted by technical experts which considers convenient to appoint, but in any case, it should be assessed by people or entities with adequate juridical education in Portuguese law.
7 - The court of arbitration will decide according to the constituted right and from its decisions there is no place for recourse, without prejudice of the stipulated in the law in annulment matters of an arbitrage decision.
8 - The decisions of the court of arbitration should be pronounced within a maximum six months deadline counted from the court constitution date stipulated under the terms of nr. 5, will configure the final decision of the resolution of the disagreement process and will include the settlement of the process costs and its sharing by the parties.
9 - In the omissive cases, the provisions included in the applicable law to voluntary arbitrage shall be observed.
Section VIII
Transitory provisions
Article 45
Concession in force
1 - The concession of establishment, management and exploitation of infrastructures affected to international connections, as well as the provision of services which are actually granted to Companhia Portuguesa Radio Marconi, S.A.(CPRM), as defined by the norms in force, brings forth only its effects with the termination of the actual CPRM concession contract in force.
2 - Verified the provision of the preceding number and by a grantor's act, the assets to integrate in the concessionaire's establishment will be settled.
Article 46
Remuneration for the interconnecting services with CPRM
Until the occurrence of the situation foreseen in nr. 1 of the preceding number, the concessionaire should be remunerated by CPRM for the interconnecting services object of present contract with the services provided by the Companhia, under the terms stipulated in the respective concession's contract and in the convention for the telecommunications services provision.
Article 47
Inventory of goods
Within one year deadline counted from the contract signature's date, the concessionaire undertakes the presentation to ICP of an inventory where are listed the goods affected to concession, under the terms of Article 20.
Seen and approved by the Cabinet on 9 December 1994 - Aníbal António Cavaco Silva - Walter Valdemar Pêgo Marques - Joaquim Martins Ferreira do Amaral - Fernando Manuel Barbosa Faria de Oliveira - Luís Manuel Gonçalves Marques Mendes. Enacted on 24 January 1995. That this shall be published. The President of the Republic, MÁRIO SOARES. Countersigned on 26 January 1995, The Prime Minister, Aníbal António Cavaco Silva.
