Broadband - Banda larga

MEMENTO for DNA: when can commercial agreements support telecom deregulation? A lesson from Austria

Here a national decision which can produce effects on the current legislative process of the Digital Network Act.

On 12 August 2026, Austria’s Federal Administrative Court (Bundesverwaltungsgericht, BVwG) set aside the 2022 decision of the Telekom-Control-Kommission (TKK) that had removed ex ante regulation from the fixed access market served by A1 Telekom Austria (the incumbent). Honestly, the Court did not decide that A1 must necessarily remain subject to SMP regulation. However, it found that the TKK could not lawfully rely on the record before it to conclude that the three-criteria test was no longer met and, therefore, to discontinue the market analysis and lift the existing access obligations.

The key point is striking.

During the review, A1 submitted commercial templates for virtual unbundling and VHCN access. But the templates were subsequently revised through an “iterative process” involving the TKK’s official experts, who provided comments and suggestions on how the contractual arrangements could be improved. The Court held that such regulator-driven changes cannot simply be treated as autonomous “market developments” demonstrating that the market is structurally tending towards effective competition.

In other words: a regulator may assess market-driven commercial arrangements. But it cannot help shape the arrangements that are later invoked as evidence that regulation is no longer needed — at least not outside the legal framework specifically designed for commitments.

That framework exists in § 98 of the Austrian TKG 2021, implementing the EECC’s commitments logic: formal offers, transparency, public consultation, assessment of openness and non-discrimination, and a decision making commitments binding. The BVwG’s message is that an informal or “soft regulation” process cannot replace — or circumvent — those procedural safeguards.

This is potentially relevant far beyond the Austrian access market.

As the EU debates the Digital Networks Act, it is worth recalling that regulatory flexibility, negotiated solutions and investment-friendly frameworks cannot come at the expense of due process. If voluntary commercial arrangements are to substitute, qualify or materially reshape ex ante obligations, they need to be:

  • transparent;
  • open to relevant market participants;
  • objectively assessable;
  • subject to consultation and scrutiny;
  • enforceable through a clear legal instrument.

Otherwise, there is a real risk that deregulation becomes dependent on arrangements shaped behind closed doors, rather than on a demonstrable and independently verifiable change in market conditions.

The case now returns to the TKK for a new decision, with renewed consultation and EU coordination. The BVwG has also allowed a further appeal to the Austrian Administrative Supreme Court (Verwaltungsgerichtshof), so the legal principle may yet be clarified at the highest administrative level.

Tu sum up: the Austrian case raises a wider question for the Digital Networks Act. Commercial agreements can be relevant evidence in a forward-looking market review. But where a regulator or its experts have materially shaped the agreement that is then used to justify deregulation, the agreement is no longer simply evidence of market-led competition. It is, in substance, a regulatory outcome — and should be subject to the transparency, openness, consultation, enforceability and monitoring safeguards of a formal commitments regime.

Leave a comment