TELECOMSNew European Union telecoms rules
On 4 November 2009, the European Parliament and Council of Ministers reached an agreement on new European Union (EU) Telecoms Reform after intense negotiations. The reform substantially strengthens competition and consumer rights on Europe's telecoms markets, facilitates high-speed internet broadband connections to all Europeans, and establishes a European Body of Telecoms Regulators to complete the single market for telecoms networks and services.
The controversial rule on which Parliament and Council disagreed was the degree to which access to the internet should, and could, be protected by EU law, as well as procedural and judicial safeguards for internet users. Agreement was reached on a new internet freedom provision that will substantially strengthen the rights of internet users. The new internet freedom provision will be accompanied by new measures to reinforce the neutral character of the internet in Europe.
The following are the twelve most prominent reforms in the new telecoms package: 1) consumers’ right to change a fixed or mobile operator in one working day while keeping their old phone number; 2) better consumer information; 3) protection of citizens' rights relating to internet access by a new internet freedom provision; 4) new guarantees for an open and more "neutral" net; 5) consumer protection against personal data breaches and spam; 6) better access to 112 emergency services; 7) greater independence for national telecoms regulators; 8) a new European Telecoms Authority that will help ensure fair competition and improved consistency of regulation on the telecoms markets; 9) a new Commission “say” on competition remedies for the telecoms markets; 10) functional separation as a means of overcoming competition problems; 11) acceleration of broadband access for all Europeans; 12) encouragement of competition and investment in next-generation access networks.
The EU Telecoms Reform package comprises five different EU Directives (a Framework Directive, the Access Directive, the Authorisation Directive, the Universal Service Directive, and the e-Privacy Directive) and a new Regulation setting up the European Telecoms Authority. The new EU telecoms rules could come into force in early 2010. EU countries will then have 18 months to incorporate the new provisions into their national legislation.
INFORMATION SOCIETY SERVICESDisclosure of subscriber data may be imposed (ECJ C-557/07)
On 19 February 2009, the European Court of Justice (ECJ) handed down a preliminary ruling requested by the Austrian court in the main proceedings LSG (a collective administration organisation which defends the rights of producers of phonograms in Austria) vs. Tele2 Telecommunication GmbH for the latter's refusal to disclose the names and addresses of persons to whom it provides internet access.
In the case of file sharing systems, which allow participants to exchange copies of stored data, LSG – which represents copyright holders – suffers financial losses. In order to bring a civil action against copyright offenders, LSG requested an order that Tele2 disclose the data of certain persons to whom it provides internet access services and whose IP addresses and access date and time are known. Tele2 rejected the request, arguing that Tele2 is not an intermediary and has no right to collect login data.
The ECJ ruled that Community law does not prevent Member States from establishing an obligation to transmit the flow of personal data to third parties in order to bring a civil action for copyright infringement. However, Community law requires that, in implementing directives, Member States must ensure a fair balance between the different fundamental rights as well as complying with the general principle of proportionality.
Tele2 argued that internet access providers neither legally nor in fact control the services available to users. They are not able to prevent such copyright infringements, because they are not "intermediaries" within the meaning of Directive 2001/29/EC. However, the ECJ ruled that by giving access to the internet, the access provider creates a possibility to transfer illegal copies between a subscriber and a third party. This interpretation confirms that one of the objectives of the Directive is to ensure effective legal protection of copyrights and related rights in the domestic market. If the access provider is not regarded as an "intermediary", which alone contains data needed for identifying users in breach of copyright, then this would limit the goals of the Directive to ensure effective copyright protection. Therefore, an internet access provider that gives users access to the internet but does not offer other services, such as electronic mail, file downloading or sharing services, and neither legally nor in fact controls use of the service provided, is regarded as an "intermediary" under the Directive.
INFORMATION SOCIETY SERVICESNew .ee regulation will require re-registration of .ee domains in 2010
Current Estonian domain name rules are rather strict in the sense that .ee domains can only be held by Estonian legal persons (i.e. companies established in Estonia or Estonian branches of foreign companies) and each entity is entitled to hold only one domain registration. These rules will be replaced by new domain name regulation in the first quarter of 2010 (expected on 1 February 2010).
The new regulation will allow applicants to register as many domain names as they wish. But it needs to be considered that registration of an .ee domain name will no longer be free of charge. A yearly fee will be imposed, though the exact amount is not yet determined. In addition, foreign persons as well as natural persons will be also able to register domain names under .ee. Foreigners need to have a local representative for domain name registration.
Current domain name registrar EENet will hand over its obligation to a new authority – the Estonian Internet Foundation (EIF). The new regulation will involve a multi-level registration process. For registration of domain names, applicants must conclude contracts with registrars (to be accredited by the EIF) who will file registration applications with the EIF. The EIF will act as a central register and register domain names under the “first come, first served” principle.
Existing .ee domain names will need to be re-registered over a six-month transitional period. Companies who have registered their .ee domain name directly at EENet, i.e. without the help of an ISP, should choose a registrar for re-registration of their domain names. According to the EIF, they will use all information they have to inform domain name owners about the re-registration obligation. Therefore, we strongly recommend you to check your contact details in the EENet domain name register.At the moment, it is unclear if a sunrise period will be available for trademark owners to register their trade marks as domain names before the new rules are open for others, thus avoiding cybersquatting.
INFORMATION SOCIETY SERVICESAmendments to the Law on Information Society Services
On 12 June 2009, the Saeima (Latvian Parliament) passed amendments to the Law on Information Society Services. As of 1 July 2009, it is legal to send advertising e-mails via automatic systems (mass mailing) without the recipient’s prior approval, but only if:
DATA PROTECTION LAWAmendments to the Natural Person Data Protection Law
By amending the Natural Person Data Protection Law on 19 June 2009, the Saeima broadened the list of purposes for data collection and handling which do not require registration of personal data processing. However, these exceptions do not include collecting certain types of sensitive data or information used for commercial purposes.
On 21 May 2009, the Saeima passed a new law regulating handling and collection of biometric data for the purpose of identification, including a list of institutions which can collect such data and the circumstances in which such data should be processed.
Amendments to the Criminal Law passed on 10 September 2009, which became effective on 14 October 2009, introduce a new penalty for abuse of personal data. Abuse of personal data which has led to serious damage will involve serious criminal punishments, the most severe of which is imprisonment up to two years. Abuse of personal data by a data handling operator or administrator as a means of revenge, blackmail, or other mercenary plans can result in the already mentioned imprisonment up to four years. Abuse of a data handling subject, or operator, or administrator, using violence, threats, or abusing trust or by cunning, with the aim of using collected data illegally, can lead to imprisonment up to five years.
TELECOMSLithuania proposes reducing mobile termination rates
The European Commission welcomed a proposal by the Lithuanian regulatory authority for electronic communications to decrease mobile termination rates in Lithuania by around 60% in the coming two years. Termination rates are the wholesale prices which mobile operators charge for terminating calls on their respective networks. As a result of the proposal, mobile termination rates in Lithuania should be amongst the lowest in the EU.
According to the European Commission, by imposing low, symmetric tariffs for providing mobile termination services, the Lithuanian regulator is taking an important step in the direction of creating the right incentives for market players to become efficient and allows Lithuanian consumers to benefit from lower prices for calls to mobile phones.The Lithuanian regulator further proposes to adapt access obligations, so that Lithuanian mobile operators cannot refuse to provide access to competitors who charge the same or lower termination fees than themselves. The Commission emphasised that access obligations are unilateral and unconditional by nature, and should in principle not be subject to conditions prevailing on markets other than the relevant market, in this case another termination market. Therefore, the Commission invited the Lithuanian regulatory authority to review the scope and wording of the access obligation imposed on mobile operators, taking account of these considerations.
INFORMATION SOCIETY SERVICESNew rules on use of “Lithuania” in .lt domains
On 7 October 2009, the Lithuanian Government approved new rules on use of the name “Lithuania” in .lt internet domain names. Now persons have the right to use the name of Lithuania in the .lt domain if they are authorised by the Lithuanian Communications Regulatory Authority (CRA).
The new rules also regulate the process of application for authorisation as well as cancellation of authorisation. Applicants will have to provide additional arguments why they want to use “Lithuania” in a domain name.
Persons who had their domain names registered earlier will not need to apply for authorisation by the CRA. A list of persons with permission to use the name “Lithuania” will be published on the CRA web site.Note that there are short and long official names – “Lithuania” and “Republic of Lithuania” – and using either in any European language and grammatical form is regulated by the rules.
In practice different types of IT contracts can be found. Even though general contract law rules apply to IT contracts, certain particularities and nuances are common to IT contracts alongside provisions common to all contracts. The more valuable and technically complicated an IT project is, the more carefully parties discuss its rights, functions, terms, and liability in contracts. Sorainen has begun publishing articles about different IT contracts commonly used in practice and their most important legal aspects. More information is available under: www.it-contracts.lt.
DATA PROTECTION LAWAppointability of person responsible for data protection
New amendments to the Law on Legal Protection of Personal Data allow a data controller to appoint a person responsible for personal data protection. This may be either a natural or legal person. Though such person is not regarded as the data processor, data controller may assign to him the functions of data processor. The person responsible for personal data protection has to ensure that personal data are processed by the data controller in accordance with the law.
If a data controller has a duty to notify the State Data Protection Inspectorate about personal data processing and has appointed a person responsible for data protection, a simplified notification would apply to the data controller. The data controller must inform the State Data Protection Inspectorate within 30 days of the appointment or termination of a person responsible for data protection.
INFORMATION SOCIETY SERVICESNew procedure for registration of information resources and information systems
The Resolution of the Ministry of Communications and Informatisation of 5 August 2009 No 32 on Some Issues Regarding State Registration of Information Resources and Information Systems introduces a new procedure for registration of information systems. The document contains instructions on how to fill in application forms and certificates of state registration of an information resource or an information system. The Resolution also provides rules on the State Register of Information Resources and the State Register of Information Systems maintenance.Registration of information systems in Belarus is a novelty. It would certainly promote development of the market for information technologies and information services, allow monitoring compliance with the objectives of state information systems, and would provide publicity of services for citizens and legal persons.
Strategy of Information Society Development in Belarus elaborated for the period to 2015
The Ministry of Communications and Informatisation in cooperation with the Academy of Sciences has elaborated a Strategy of Information Society Development for the period until 2015. The Strategy defines the goals, objectives, and priorities for the development of informatisation in Belarus in the coming years.
The Strategy identifies the following steps for development: improving management of processes of the informatisation and telecommunication services market, liquidating weak coordination between the State and business in the field of information, liquidating the "digital divide" between social groups in urban and rural areas, between sectors of the economy, improving the regulatory framework for the provision of electronic public services; further implementing of digital signatures.The priorities of information society development are: e-government, e-health care, e-learning, e-employment and social support, e-economy, and e-commerce.
IT and telecom news in Belarus
An international specialised exhibition "Promising technologies and systems: informatics, telecommunications, security” took place on 17-20 November 2009 in Minsk.
The exhibition featured products and services of dozens of Belarusian and foreign companies working in the field of information technology.This year, special emphasis was put on IT infrastructure integrated into everyday life – systems of life support, security, communications, and digital entertainment. Cable television movie packages in high definition image format FullHD were broadcast for the first time in Belarus.
RECENT TRANSACTIONSAdvising leading global computer software manufacturer on laws in the Baltics
Sorainen Estonia advised a global leader in computer software manufacturing and IT service provision regarding electronic communications and telecoms laws in the Baltics. The task included compiling an overview of legal norms governing various novel electronic communications standards and determining whether services offered by the client would constitute a publicly available electronic communications service under local law. As a prerequisite, the exercise demanded comprehensive understanding of the client’s business model in relation to technologies such as VoIP, P2P, and PSTN. The case was handled by competition law expert associate Ivar Kurvits and partner Kaupo Lepasepp.
Advising global telecommunication sector leader on regulatory demands in Estonia and Latvia
Sorainen Estonia advised a global leader in the telecommunication sector in agency matters in relation to its various co-operation partners in Estonia and Latvia. The task included compiling an overview of legal norms governing various services offered by the client in the electronic communications sector and determining whether these services would require prior authorisation by regulators. The case was handled by competition law expert associate Ivar Kurvits and partner Kaupo Lepasepp.
Compiling legal survey for a leading Baltic computer company
Sorainen Estonia compiled a comprehensive survey of telecom-related legal acts in the Baltics for a major global computer company and systems integrator. The task encompassed compiling an overview of legal norms governing various novel electronic communications standards. The case was handled by associate Mihkel Miidla and partner Kaupo Lepasepp.
Drafting license agreement for Modesat Communications in Estonia
Sorainen Estonia drafted a technology evaluation and prospective license agreement for evaluating high-tech communications components developed by the client – a leading-edge modem developer in the fields of radio and wired communications. The case was handled by associate Mihkel Miidla and partner Kaupo Lepasepp.
Analysing and assessing contract package for leading European software producer
Sorainen Latvia recently carried out a detailed in-depth analysis and assessment of the client's software field service contract package. Sorainen team made relevant mandatory law compliance adjustments and adjustments to local circumstances. The transaction was led by partner Agris Repšs and associate Jānis Bite.
Performing contract due diligence and giving recommendations to leading Latvian IT company and software producer
Sorainen Latvia performed a detailed due diligence on the client's software development and other IT contracts and prepared recommendations on how to improve protection of the client’s intellectual property rights. On the basis of the contract audit and risks identified, Sorainen also prepared suggestions for overall IT contract risk management. The Sorainen team was led by partner Agris Repšs and senior associate Ieva Bērziņa-Andersone.
Advising leading global IT company and hardware producer
Sorainen Latvia was hired through an international law firm based in London to prepare comprehensive and detailed advice about the client's information technology services in Latvia, including analysis of legal aspects of a specific software solution in relation to regulation of electronic communication services in Latvia. The client was advised by partner Agris Repšs and senior associate Ieva Bērziņa-Andersone.
Advising Voxbone on Lithuanian telecommunication law
Sorainen Lithuania is advising Voxbone, a Belgian telecommunication company, the leading VoIP carrier, providing centralised access to local phone numbers and toll-free numbers around the world, on various aspects of Lithuanian telecommunication law including VoIP regulation, allocation of numbering resources, and notification requirements. The client is advised by partner Renata Beržanskienė and associate Paulius Galubickas.
Advising Hewlett-Packard on IT matters
Sorainen Lithuania is regularly advising Hewlett-Packard, a leading technology company that operates in more than 170 countries around the world, on IT legal issues such as public procurement, software licensing, warranty terms, software maintenance service agreements, and hardware procurement contracts. The client is advised by partner Renata Beržanskienė, senior associates Algirdas Pekšys and Liudas Ramanauskas, and associate Paulius Galubickas.
Assistance on data protection
Sorainen Lithuania advised one of the world’s leading marketing and media information companies on data protection including data transfer to third countries and other legal aspects of data processing. The client was advised by partner Renata Beržanskienė and associate Paulius Galubickas.
Legal assistance on implementing joint venture IT system
The Lithuania office team led by partner Renata Beržanskienė advised world leading IT companies on complex arrangements for the implementation of an IT system in a joint venture, localisation of IT contracts in accordance with Lithuanian law, as well as outsourcing arrangements for facilities management. The clients were also advised by senior associate Liudas Ramanauskas and associate Paulius Galubickas.
REGIONAL NEWSChanges in Sorainen management
A recent meeting of partners in law firm Sorainen appointed the founding partner and current managing partner, Aku Sorainen, to the position of senior partner. In his new role, he will focus more on strategic management of Sorainen and its business development across the region. From January 2010 the current office managing partner of Sorainen Latvia, Pekka Puolakka, will be promoted to the position of managing partner.
These changes in management result from the firm’s continuing growth. “Over the last eight years, Sorainen has grown organically more than four times by building strong integrated offices in Estonia, Latvia, Lithuania, and Belarus. To ensure that balanced development as a leading regional law firm continues in the future, we have decided to allocate more resources to group management and business development”, commented Aku, adding: “Pekka Puolakka, who will take on the responsibility of Sorainen managing partner, joined the firm in 1999 and established our office in Lithuania. Since June 2006, he has acted as office managing partner of Sorainen Latvia. Pekka will now start to focus more on operational management of the firm as a whole.”
The new office managing partner of Sorainen Latvia will be Eva Berlaus, who joined Sorainen in 2000 and currently heads the local Mergers & Acquisitions team in Latvia.
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Please note that this legal update is compiled for general information purposes only, free of obligation and free of legal responsibility and liability. It does not cover all laws or reflect all changes in legislation, nor are the explanations provided exhaustive. Therefore, we recommend that you contact Sorainen or other legal advisor for further information. The Sorainen IT & Telecoms Legal Update is published periodically (every 4-6 months) and covers legal news related to IT and telecoms in Estonia, Latvia, Lithuania, and Belarus. Electronic versions of Sorainen Legal Updates are available and can be subscribed to on the Sorainen website – www.sorainen.com.
© SORAINEN 2009