RESTRICTED
WORLD TRADE S/NGBT/W/3/Add.18/Rev.1
19January 1995
ORGANIZATION
(95-0063)
Negotiating Group onBasic Telecommunications Original: English
COMMUNICATION FROM HUNGARY
Response toQuestionnaire onBasic Telecommunications
Revision
Theattached communication iscirculated attherequest ofHungary toMembers ofthe
Negotiating Group onBasic Telecommunications. Itreplaces document S/NGBT/W/3/Add.18.
_______________S/NGBT/W/3/Add.18/Rev.1
Page2
PartI
Definition andMarket Structure
Definition
1. TheHungarian regulation doesnotdefine thebasic telecommunication. Theconcept ofbasic
telecommunications services isusedinstead. Theconcept isdefined incaseofpublic networks that
abasic telecommunications service isrespected assuchifitsusage isensured forthesubscriber by
thesubscriber 'scontract without anyadditional agreement.
Iftheuseofaservice isconditioned byfiling anadditional claim and/or byobligation of
additional fee,thatservice cannot beconsidered basic service, butitfallsintooneofthecategories
ofthe"liberalized services".
TheTelecommunications ActNo.LXXII of1992 isstrongly service-oriented andthusthat
partoftheGATS 'sdefinition which takesthetransport network forthepartofbasictelecommunications
doesnotcoincide withtheHungarian terminology. However, forthepurpose ofthisquestionnaire,
theconcession bound services areconsidered tobebasic services. Ofcourse, thetransport network
candeliver basic services aswellasother services.
There arenomonopolies intheHungarian telecommunications, butthesubsectors providing
services onthebasisofstateconcessions areexclusive bydefinition. These aretheconcession bound
services, which arethestate'sresponsibilities toprovide:
- public telephone
- mobile radio-telephone
- nation-wide paging system
- nation-wide andregional distribution andbroadcasting ofpublic service radio and
television programmes
With theexception oftheconcession bound services defined above, other telecommunication
services areliberalized, inparticular national public switched datatransmission services, maybe
performed byanyperson subject totheservice licence requirements setforth intheAnnex ofthe
Telecommunication Actasfollows:
Definitions related tothetelecommunications services
Telecommunications
Aprocess whereby signals, signs, texts, pictures, voice ormessages ofother nature generated
inanyconceivable andmeaningful formcanbetransmitted, either viacable orbyelectrical oroptical
means, orbyradio orother electromagnetic system orthrough acombination thereof, tooneormore
user.
Telecommunications services
Abusiness activity where thesupplier performs telecommunications andrelated secondary
services forthirdparties against thepayment ofafeeormakes hisnetwork available forthispurpose
either inthepublic sector (bound toconcession) orinthecompetitive sector.S/NGBT/W/3/Add.18/Rev.1
Page3
Public telephone services
Aservice provided bythesupplier forthetransmission ofvocal messages through public
telephone network against thepayment ofafee.Public telephone service mayinclude international,
domestic andlocaltelephone services.
(a) International telephone services aretelecommunication services bound toconcession
where thesupplier provides connection tointernational service access points.
(b) Domestictelephoneservicesaretelecommunicationsservicesboundtoconcessionwhere
thesupplierprovidesconnectionthroughorwiththebackbonenetworkunderagreements
made withusers.
(c) Local telephone services aretelecommunications services bound toconcession where
thesupplier executes subscriber agreements withusers inlocalnetworks orprimary
areas. Theconcession companies authorized toperform LTSshall alsoexecute
agreements fortheuseoftheservices.
Public mobile radio telephone services
Direct realtime transmission ofelectromagnetic signals through public switched radio
telecommunications network tousers freely moving inanextensive space, against thepayment ofa
fee.Signals canbetransmitted between mobile terminals connected tothenetwork and/or between
mobile terminals andusers ofpublic telephone services.
Public telecommunications services
Public services provided bytelecommunications organizations through thepublic telephone
network where thestate, assuming responsibility fortheavailability ofsuchservices toallusers, defines
thespecial relevant liabilities andrights ofthetelecommunications organizations.
Telegraph services
Aservice where theprovider receives thetextofthemessage fromtheclient, either through
thetelecommunications network orbymeans ofapostal service operator, transmits itoverthe
telecommunications network, thendelivers itbyoperator, transmits itoverthetelecommunications
network, thendelivers itby
(a) apostal service provider (oranyother entrepreneur);
(b) telephone;
(c) telex;
(d) telefax; and
(e) anyother way.
Programme distribution
Transmissionofsignalsprovidedbyprogrammesupplierstotheradioandtelevisionbroadcasting
station andother programme transmission networks.S/NGBT/W/3/Add.18/Rev.1
Page4
Broadcasting andprogramme transmission
Onewaywireless telecommunication process totransmit sound, picture orother programmes
tousers withcompatible receiving sets. Thenumber ofusers isvirtually unlimited.
National broadcasting andprogramme transmission
Aprogramme service covering arange including notlessthan50percentofthepopulation.
Regional broadcasting andprogramme transmission
Abroadcasting orprogramme transmission service where therange ofreceiving ordistribution
coverstheadministrativeareasoftwoormorelocalgovernmentsofvillages,citiesormunicipaldistricts,
whether adjacent orgeographically separate.
Telecommunications service providers
Entities, organizations without anentity andprivate entrepreneurs, orconcession companies
incaseofpublic telecommunications services bound toconcessions, thatprovide telecommunications
services tothethirdparties (supplies, users orsubscribers).
Leased lineservices
Telecommunications services where thesections ofcircuits interconnecting points ofaccess
toservicesaremadeavailablebyaserviceprovider(operator)fortheperformanceoftelecommunications
activities inreturn forthepayment ofafee.
Definitions related totelecommunications networks
Telecommunications network
Asettelecommunications equipment interconnected byrealorvirtual linkswhereby signals,
written texts, pictures, sound orother messages canbetransmitted overoneormore routes between
specific service access points. Interconnection means connection established compatible
telecommunications network. Connection means connection ofequipment tothetelecommunications
network forthepurpose oftelecommunications services.
Public telephone network
Asystem ofservices access points, transmission pathsandswitching equipment interconnecting
theabove elements which enable anyperson whomaywishtoutilise itunder equal terms andconditions
theterminal equipment connected toaservice access point fortheexchange ofinformation withthe
userofanother terminal equipment connected toanother service access point.
Telecommunications backbone network
Abasic partofthetelecommunications network thatiscapable ofthetransmission ofanykind
ofthetelecommunicationssignals.Theservicesofthisnetworkarenotprovideddirectlyforsubscribers.
Iitensures access, atadefined signal transmission rate,through nodes, fornetworks thatprovide
subscriber 'sservices under contracts. Thebackbone network extends uptoservice access points at
theexchanges ofprimary areas asdefined inthemaster technical plans.S/NGBT/W/3/Add.18/Rev.1
Page5
Leased lines
Setofsections ofcircuits interconnecting points ofaccess tointernational anddomestic services
(telecommunications equipment). Leased linesinclude transmission routes, interface access points
forthepurpose oftestsonlyandareusedtoestablish connection without signal routing.
Dedicated (special purpose networks)
Telecommunications networks separated physically, functionally orinterms ofapplication from
othertelecommunications networks implemented andoperated byspecially licence exclusive usergroups
usedforinternal telecommunications traffic ofmembers.
Local telephone company
Business organization formed bynatural persons andentities including thecompetent local
government interested intheuseoflocalpublic telephone services fortheimplementation (construction
anddevelopment) ofpublic telecom networks capable ofsuchservices.
Primary area
Asegment ofthepublic telephone network where thebackbone network isnotrequired for
performing theservices under subscriber agreement ofestablishing connection between anytwoservices
access points.
2. Theregulation distinguishes between thepublic telecommunications network andthepublic
telecommunications services (concession bound services) inthedefinition oftelecommunications service
categories andnospecial distinction ismade between basic andvalue added service.
3. Seereply toquestion 1.
Market structure
4. According totheTelecommunication Acttheconcession bound services reserved services can
beclassified asreserved services. Other services areliberalized.
5. Theconcessions canbeobtained bytheCompetition Actof1991andtherulesofcompetition
areregulated bytheDecree oftheMinister No.25/1993 (IX.9). Intheregional (local networks) the
ownership structure ofconcession companies arethecompetence oftheMinister. Thecompanies
remaininginlongtermstateownership,e.g.thoseentitledtotheNationalConcessionCo.areexceptions.
(ActLIIof1992, andtheGovernment Decree No.126/1992 (VIII.28)). Forownership limitations
seereply toanswer 6.
6. Yes.TheGovernmentgrantedbothforthesuccessorcompanyoftheformermonopolistsupplier
(MATAV Co.,nowNational Concession Co.)andeighteen other newservice providers authorized
forproviding local(socalled primary district) services byconcession. OnlytheNational Concession
Company isauthorized fornational andinternational longdistance service. Theconcession expires
intwenty-fiveyears(beginningin1993),andforthefirsteightyearsaterritorialexclusivityisguaranteed
bythestate. Thebiggest company, National Concession Co.hasabout 33percentofforeign share
(30.1 percentoftheshares obtained byaconsortium consisting ofDeutsche Telecom andAmeritech
International and2.9percentoftheshares belongs toIFCandEBRD), theremaining majority ofthe
shares arestillheldbythestate. Themaximum foreign participation allowed inbytheConcession
Actis49percent.S/NGBT/W/3/Add.18/Rev.1
Page6
Inthelocalloops, theconcession holders 'share isbetween 49and75percent. Themaximum
foreign participation allowed bytheConcession Actis75percent. National Concession Company
(NCC) became concession holders in36of54primary districts while other companies havewonin
theremaining 18districts.
7.(a) Thecompetition isnotallowed inconcession bound services.
Inthefieldofvoice telephony till2002 forinternational andlongdistance services andfor
localservices 2003.
Inthefieldofmobile telephony three licences (twoGSM andoneNMT 450)andforpaging
twolicences were issued asfollows:
In1991, MATAV andUSWest established ajointventure (Westel) fora450MHz mobile
cellular communications system. Thesystem achieved fullnational coverage in1993.
In1993, theMinistry issued twoconcessions fortheestablishment of900MHz digital, GSM
systems.
Theconcession contract called forstart-up by1April 1994 withcoverage forBudapest. In
thesecond phase themajor highways mustbecovered. Total coverage mustbeachieved bytheend
of1995. TheGSM system willallow future roaming intoother European countries where GSM is
used.
Demand hasexploded forthenewmobile cellular service. Inmostcases, mobile phones are
being usedasasubstitute forland-line communications. During thethree years ofoperation, Westel
450,forexample, hasnearly achieved fullcapacity (56,000 subscribers). Recently, there areabout
86,000 mobile subscribers.
Recently acompany called Operator Hungaria provides paging services inHungary. Operator
Hungaria Kftis51percentowned byAntenna Hungaria and49percentbyTDF (France Télécom
subsidiary). Operator Hungaria provides paging service ononeoftheFMbroadcasting channels with
nation-wide coverage.
InFebruary 1994, theMinistry issued atender fortwoconcessions fortheinstallation and
operation ofnational paging services equivalent totheERMES (European Radio Message System).
Thetwoconcessions wereawarded to:"Magyar Paging", aconsortium comprising Gerard ACSales
andLeasing CO(USA) andMicros stemTelecom (Hungary); "EastyCall Hungaria", aconsortium
ofMatrix Telecommunications Ltd.(Australia) andTelecom Finland.
Thefacsimile, telex, datatransmission andsatellite services areliberalized.
7(b) TheNational Concession Co.andservice providers inthelocalareanetwork canconclude
subcontract withforeign suppliers. Only exception concerns thedigital switches.
8. ITU-International Telecommunications Union:
- Constitution andConvention (Geneva, 1992);
- ITUInternational Radiocommunications Regulations;
- ITUInternational Telecommunications Regulations (Ratification isexpected in1995).S/NGBT/W/3/Add.18/Rev.1
Page7
Hungary isaParty ofEUTELSAT, INTELSAT andINTERSPUTNIK. Thesignatory office
istheHUNSAT Association which isaconsortium ofMATAV Co.andAntenna Hungaria
Radiocommunications Co.S/NGBT/W/3/Add.18/Rev.1
Page8
PartII
Competition
A. Sub-sectors
(a) Public switched telephone service (concession bound service)
(i) Overview: seeanswers inPartI.
(ii) Modes ofsupply: Inthefieldofvoice telephony outofthecountry, thereareservices
realized viatheinternational network:
(a) provision ofservice fromoneMember 'sterritory toanother Member 's(call
toaforeign subscriber);
(b) provision ofservice onaMember 'sterritory fortheuserofanother Member
(transport ofthecallfrom abroad);
(d) provision ofservice onaMember 'sterritory foracitizen ofanother Member
(Telecard service).
Theinternational callsarecarried outviatheinternational circuits.
Thesatellite services suchasVSAT isliberalized.
Liberalized service concerning theinternational service isthe"Hungary Direct" service enabling
callsmade fromabroad toaccount ofthe(Hungarian citizen) caller. Another introduced form isthe
Telecard service offering thepossibility ofinternational callsmade byforeign citizens inHungary to
theirbankaccount.
(iii) Market access: Thisservice should onlybeprovided byaconcession holder.
(iv) National treatment: Thesamerestrictions arevalidfortheareaoftelecommunications
asthose forevery foreign investment inHungary.
(v) Licensing: Typeorindividual approval ofimplemented technical devices ismandatory
onthebasis ofobligatory Hungarian standards including domesticated standards of
theEuropean Telecommunications Standardization Institute (ETSI). Newtrackprojects
should havenetwork licence too,andatlast,theswitching andtransmission equipment
should getapermission forimplementation.
Theservice provider should keeptheprescribed quality levelwhich ischecked bythe
General Inspectorate ofCommunications (GIC) periodically. Incaseofdeterioration
ofservice theMinistry orders atariffreduction; inajustified case,canevenwithdraw
theconcession.
Liberalized services
(b) Public packet switched dataserviceS/NGBT/W/3/Add.18/Rev.1
Page9
(i) Overview: Themarket ofthesubsector isliberalized. Recently there isonenational
network, partly state-owned.
(ii) Modes ofsupply: Inaddition tothenational supplier, several private networks are
connected tointernational service provider 'snetwork (e.g.Internet).
(iii) Market access: National treatment exists.
(v) Licensing: Inrespect ofequipment andnetwork, seesub-section (a)(v).The
establishment ofHungarian Name Registration Office isinprogress. Starting ofits
activity isexpected atthebeginning of1995.
(c) Public circuit switched dataservice
(i) Overview: Themarket isliberalized.
(ii) Modes ofsupply: Forthetimebeing, onlyonenational supplier, theNCC exists.
(iii) (v)Seesection b.
(d) Telex service
(i) Overview: themarket isliberalized, butactually thereisonlyonenational public telex
network, owned bytheNCC.
(ii) (v)Seesection b.
(e) Telegraph service
Seesection b.Therelated postal service istheonlyservice provider forthetimebeing.
(f) Facsimile service
Themarket isliberalized. Seesection d.
(o) Others
National andregional distribution andbroadcasting ofpublic radio andTVprogrammes
(i) Overview: TheGovernment hasnotgranted concessions fornational distribution
broadcasting ofpublic radio andTVprogrammes astheMedia Acthasnotpassed the
legislation.
Thecable TVmarket isliberalized. InBudapest awireless distribution network called
"AM-Micro" isoperated. Foreign payTV(movie channel) ispresent ontheHungarian
market.
(iii) Modes ofsupply: Thenationwide radio andTVprogrammes aredistributed bythe
Antenna Hungaria Radiocommunications Co.
(iii) Market access: Theaccess tothemarket isbarred untilthepassing oftheMedia Act.S/NGBT/W/3/Add.18/Rev.1
Page10
(iv) National treatment: Foreign equity participation isexpected.
B. Categories
Local/long distance/international
1. Thetelephone connection islocalifithasbeenestablished within onelocality or-incaseof
several localities within thefeeding areaofalocalexchange. Theconnection islongdistance/national,
ifitcrosses theborders oflocalarea, butdoesnotcross theborder ofthecountry.
2. Theregulation makes adistinction between domestic long-distance andinternational services
asfollows:
(a) onlytheNational Concession Company isauthorized forproviding international and
long-distance services till2002.
(b) local telephone companies areauthorized forproviding service onlyintheprimary
areas till2003.
Theregulation restricts thenumber ofservice providers foreightyears ontheconcession bound
service:
- international andlong-distance service, onlytheNational Concession Co.
- fortelephony, foreachprimary district-one.
- ForGSM radiotelephony, two,andanalogue radiotelephony onenation-wide licence
- forERMES paging network, two,andforanalogue paging onenation-wide licence.
Incaseofdatatransmission, programme distribution, intheirwireless network, thefrequency
management imposes restrictions; forthelackoffreefrequency bands.
Wire-based
(i) Overview: theanswer actually coincides with that given forlocal/long
distance/internationalwiththeadditionthattheHungarianregulationusestheexpression
"trackprojected"ratherthan"wired",becausethenationalbackbonecontainsmicrowave
linksaswellasandoptical fibreoneswhich generally fallintothesame category as
thewired tracks. Their leasing byother service providers isregulated inrespect of
feesofusage.Otherwisethefrequencyrestrictionsshouldbeconsideredforthewireless
tracks. Ofprivate networks, theTelecommunications Acthighlights thecorporate ones,
theowners ofwhich areauthorized tolease outcircuits orparts ofthenetwork.
(ii) Modes ofsupply: Seetheanswers given insection A.Forinterconnection ofnetworks
ofdifferent suppliers, prescriptions oftheFundamental Technical Plans should be
considered.
(iii) Market access: When building track-project connections, ifitisbeing builtnotby
theNational Concessionaire Company, anditcrosses theborder ofthelocalnetwork,
theinvestor should enter anetwork contract withtheNational Concession Co.which
stipulates thetraffic-dependent feesandtheresponsibilities. Theterminal points of
thetrack should belocated inaccordance withtheFundamental Technical Plans.S/NGBT/W/3/Add.18/Rev.1
Page11
(iv) National treatment: Restrictions related toforeign investors areenforced through the
concession contracts. These arevalid, however, onlyfortheservices andarenotvalid
forinvestments ormaintenance.
(v) Licensing: Seetheanswer tosection A.
Radio-based services
(i) Overview: Itwould beappropriate toseparate thewireless network providing
autonomous services from thewireless parts ofthetrack-projected networks.
Public cellular radiotelephone, national paging, wireless dataVSAT, trenched wireless,
dispatched networks. Their regulation hasafrequency management character while
thefirsttworequire concession.
(ii) Modes ofsupply: Wireless tracks, localloopextends andlineconcentrators. Their
regulation hasafrequency management character while requiring anetwork licence.
(iii)-(iv) Seeattheservices.
(v) Licensing: Besides afrequency permission, atypeapproval orindividual approval
oftheequipment isnecessary.
Public mobile radiotelephone service (concession bound service)
(i) Overview: TheGovernment granted twoGSM service providers andoneNMT-450
service provider concession whoarecompeting witheachother. Allcompanies have
foreign share near49percent.
(ii) Modes ofsupply: ThetwoGSM service providers using thepan-European GSM
standards.OneNMT-450serviceproviderensurestheinternationalaccessonlythrough
thenational transit network.
Public paging service (concession bound service)
(i) Overview: TheGovernment granted twosupplier companies concession which are
incompetition. Bothcompanies haveabout 75percentforeign share.
(ii) Modes ofsupply: Theconcession holders should usethepan-European ERMES paging
system.
(ii) Modes ofsupply: iscarried outviatheinternational circuits. Thecase(c)takes place
withVSAT service which isliberalized. Mode (d)iscurrent aswell; oneofits
realization isthe"Hungary Direct" service enabling callsmade fromabroad toaccount
ofthe(Hungarian citizen) caller. Another introduced form istheTelecard service
offering thepossibility ofinternational callsmade byforeign citizens inHungary to
theirbankaccount.
(iii) Market access: Theabove services should onlybeprovided byaconcession holder.
(iv) National treatment: Thesamerestrictions arevalidfortheareaoftelecommunications
asthose forevery foreign investment inHungary.S/NGBT/W/3/Add.18/Rev.1
Page12
(v) Licensing: seeanswer inpartA.
3. Nonecessity ofregulation hasoccurred untilnow. Thecorporate networks arecharacterized
bythepossibility tolease apartorthewhole forpublic service.
4. Iftheprivate network isinterconnected tothepublic network, theresale ofpublic network
access isallowed forathirdparty onlyinspecial case. Thisisthesocalled PABX service which may
beprovided onlyonprivate localnetworks, i.e.onPABX networks which doesnotcross theborder
ofthegiven public localnetwork.
Forthetimebeing, theconcession oftheNCC ensures exclusivity inrelation ofthenational
andinternational transit connections. Thus, theMinistry grants nolicence forsuchactivity offurther
companies, except forcorporate networks ofsome nation-wide companies which maytransport traffic
inbetween theirownsphere ofinterest andbetween theirownstations without restriction. However,
theyarenotallowed topasstransit callsoriginated andterminated inthepublic network.
(iii) Market access: Themarket isliberalized inrespect ofthePABX service.
(v) Licensing: ThePABX service provider isobliged touseanequipment withtype
approval. Itsnetwork should comply withtherequirements oftheFundamental
Technical Plans.
5. Yes.Theregulation isreferred firstly totheservice providers andtherequirements oflicensing
areenforced tothenetwork investors oroperators through theservice suppliers. Itislefttothebasic
telecommunications service providers whether theyinvest themselves ortheyleasetheequipment from
another investor company, theyoperate oritisoutsourced. Theservice provider alone isresponsible
forthequality ofservice.
Public/non-public supply
6. Yes. Thenon-public service providers areenforced tocomply withtherequirements ofthe
Fundamental Technical Plans tosuchanextent astheirusers canbeinterconnected withthepublic
network. Themarket ofthenon-public telecommunications isfullyliberalized andtheinner quality
levelofthenetworks isformed bythemarket. Thequality control activity oftheGeneral Inspectorate
doesnotcomprise thenon-public networks andthestatecommitments stipulated intheconcession
agreements donotcover these networks.
7. Thepublic access ismandatory forallsubsectors enlisted intheChapter A.
8. Suchnetworks areasprivate local, corporate andspecial ones(e.g.datatransmission forbanks,
some wireless services suchasdispatcher, trunked, PABX networks etc).
9. Thegeneral obligations andresponsibilities fortelecommunications operators areasfollows:
- Tocomply withtheFundamental Technical Plans. These are:
Structure plan
Numbering plan
Routing plan
Transmission plan
Signalling plan
Synchronization planS/NGBT/W/3/Add.18/Rev.1
Page13
Interconnection plan
Dependability andReliability plan
Service plan
Service andnetwork security plan
Wireless radiation plan
- Compliance withtariff decrees andtariff caps
- Compliance withdecrees ofbuilding andservice licensing
- Approval ofTrade Regulation ofthecompany
- Compliance withobligations forquality control anddatadelivery
- Inthecaseofaconcessionaire, fulfilling theprovisional anddevelopment obligations
stipulated inthecontract.
Fortheconcession bound services theconcession 'sholders should meettherequirements of
theconcession contract. Thedecree concerning theliberalized services isunder preparation.
10. Restriction onorganizing aprivate network:
- Frequency usage onawireless network;
- Compliance withsome technical requirements when connecting tothepublic network;
and
- Routing restrictions withrespect totheinterworking withthepublic network.
11. Theoperation ofpublic payphones arereserved totheconcession holders.
PART III
Regulatory issues
Relationship between regulatory andoperational functions
1. No.According tothepractice, thelawmaking institution (theMinistry) sends thedrafts of
lawsandthestandardsunderpreparationtotheconcessionserviceprovidersforthepurposeofexpressing
theiropinion.
2. Inthefieldofstandardization National Standardization Institute isthecompetent agency. Prior
decision National Standardization Institute should consult withtheMinister.
3. Only government level regulation exists according totheTelecommunications Act. The
regulatory bodyistheMinistry. Theservice provider should keeptheprescribed quality levelwhich
ischecked bytheGeneral Inspectorate ofCommunications periodically. Incaseofdeterioration of
service theMinistry orders atariffreduction. Inajustified case,theconcession canbeevenwithdrawn.
Thedecision oftheregulatory bodycanbechallenged incourt. Disputes afterareconciliation
bytheregulatory body canbesettled byArbitration.
4. Frequency allocation istherightofCommunications Inspectorate, asastatebudget institute
operating under thesupervision ofMinistry ofTransport Communications andWater Management
(Government Decree No.142/1993 (X.13)). Frequency Management isregulated bytheFrequency
Management ActNo.LXII of1993. Thebasis offrequency allocation isadraft ofthe"NationalS/NGBT/W/3/Add.18/Rev.1
Page14
Allocation Table ofFrequency Bands" (NATF) which hasbeen prepared and,atthetimeofthe
introduction, theregulation oftheprocedures willalsobedone.
5. Theregulations offrequency assignment mean anational treatment forallservice providers.
Numbering andidentification codes
6. Numbering structure andnumber allocation applied inpublic telephone network (PSTN) and
theselection procedures areregulated bytheDecree oftheMinister No.24/1993 (IX.9)
7. Therulesofnumbering according totheprevious reply, mean national treatment forallservice
providers.
8. Internationalstandards(ISO,CEN,CENELEC),EuropeanTelecommunicationsStandardization
Institute (ETSI), andinternational recommendations (ITU-T andITU-R) areused. Thedraftoflaw
forregulating standardization hasbeenprepared.
9. Atemporary regulation isapplied tonational standardization (Government Decree No.42/1994
(III.25)) which brings regulations ofthisareacloser totheEuropean standardization andaccrediting
system. Inpractice division oflabour isambiguous among General Inspectorate ofCommunications,
Hungarian Standardization Institute andthevoluntary andaccredited organizations.
10. Allequipment connected tothepublic telecommunications network issubject toofficial licence.
Thebasic principle is"noharm tothenetwork".
11. TheCPEmarket isliberalized.
12. Determination ofswitches applicable inpublic telephone networks (selection ofsystem) was
aGovernmentdecision:onlyEriksson(AXE)andSiemens(EWSD)switchescanbebuiltinthenetwork.
13. Noregulation ispublished inthisareayet.
Interconnection
14. Theinterconnection isregulated byaGovernment Decree No154/1993.
15. No.Discrimination isprohibited inthesense thatallthesubscriber terminal equipment is
compulsory toconnect tothenetwork thathasofficial licence.
16. Cooperationandinterconnectionofnetworksare,undertheauthorizationofTelecommunications
Act,regulated bytheGovernment order No.158/1993 (XI.11). Thetechnological, economic and
trafficconditionsofnetworkcooperationaretobeagreeduponinthenetworkagreement.Theagreement
istobepresented totheCommunications Inspectorate.
17. Theservice provider isobliged incaseitisgiven acontract offer inaccordance withthe
prescribed conditions.
Incaseofpublic telephone services andmobile telephone services alsotheinterconnection
charges fallunder official priceregulation (30/1993 (XI.23) (Ministry ofTransport, Communications
andWater Management order) and(13/1994.II.17 Ministry ofTransport, Communications andWater
Management order). These orders define acharge maximum for1994, afterthisthechange ofchargeS/NGBT/W/3/Add.18/Rev.1
Page15
maximum isconnected totheproducers 'price index (price cap-regulation). Theinterconnection
charge includes onetimeconnection price, monthly price andthecharge forthecallforwarding.
18. Neither competition normerging ofcompanies isregulated specially intelecommunications
sector. TheCompetition Actof1990, asgeneral regulation, istobeapplied forthisareaaswell.
TheCompetitionActprohibitsunfaircompetition,competitionrestrictingagreementsandabusingpower
ofeconomic advantage. Thisareaisregulated alsobythelawforprohibition ofunfair market behaviour
(ActLXXXVII of1990) andtheActforsettling theprices (ActLXXXVII of1990).
Incaseofmerging ofcompanies theCompetition Agency performs control, supervision function
forthepurpose ofprotection ofmarket participants.
Leased linescanbeconnected tothepublic network, butthisisnotqualified interconnection.
19. Nosuchdefinition exists.
20. Nospecific safeguards exist butthegovernment decision (selection ofsystem) onthe
manufacturers oftheexchanges tobeapplied inpublic telephone network might beconsidered as
restriction ofcompetition.
21. Seeanswer onquestion 21.
22. Thecharges ofconcession bound services aredetermined intheDecrees oftheMinister
No.30/1993 (XI.23) andNo.13/1994 (III.17).
Forpublic switched network services Hungary employs thepricecapformula. TheGovernment
would liketoensure through thetariff policy anequilibrium between thelevel ofdemand andthe
financial capabilities ofconcession service providers. There arethree major tariff categories inthe
fieldofvoice telephony:
(1) subscription fees;
(2) localcalls;
(3) longdistance andinternational calls.
Categories 2and3aredivided intotariff zones. Future changes intariffs aretobelinked
tochanges intheProducer Price Index (PPI), which islower thantheconsumer price index (CPI).
23. Theprices ofconcession bound telecommunications services aredetermined for1994 under
theauthorization ofTelecommunications Actandtheprice maximum (price cap)regulation isalso
determined. Thetariff plans prepared yearly bytheservice providers areaccepted andpublished by
theGovernment.
Theofficial prices havebeendetermined withtheconsideration ofnational costs, price and
income levels.
24. Traffic-dependent feesandtheirdistribution among service providers aredefined byMinisterial
Decree. Thefeesofinternational callsarestipulated ininternational agreements. Nosuchdetailed
regulation isthere forother subsectors oftelecommunications.
25. No.S/NGBT/W/3/Add.18/Rev.1
Page16
26. Thegeneral priceregulation isapplied tothenon-concession bound telecommunications services
butthere isnogeneral principle regarding allocation ofcosts andcost-oriented pricing.
27. No.
28. Construction oftheown network forthepurpose ofprovision ofconcession bound
telecommunications services isdetermined bythegovernment intheconcession contract. Establishment
oftrackoriented telecommunications canbedonebyapproval oftheGICafterthebasic technical plan
isreviewed.
29. Yes.
Newtelecommunications services
30. Theregulatory body (theMinistry) decides oncase-by-case whether anewservice belongs
toaconcession bound service ortheliberated regime tilltherelevant regulation isissued.
31. Ifthenewservice does notfallintothecategory oftheconcession bound services, the
competition ispermitted.