Telecoms and Media 2016 Contributing Editors Laurent Garzaniti and Natasha Good Freshfields Bruckhaus Deringer

2016

Research Business Law ©

2016

Contributing editors Good Natasha and Garzaniti Laurent

and Media and Telecoms Telecoms

GETTING THE DEAL THROUGH Telecoms and Media 2016 Telecoms and Media 2016

Contributing editors Laurent Garzaniti and Natasha Good Freshfields Bruckhaus Deringer LLP

Publisher Law The information provided in this publication is Gideon Roberton general and may not apply in a specific situation. [email protected] Business Legal advice should always be sought before taking Research any legal action based on the information provided. Subscriptions This information is not intended to create, nor does Sophie Pallier Published by receipt of it constitute, a lawyer–client relationship. [email protected] Law Business Research Ltd The publishers and authors accept no responsibility 87 Lancaster Road for any acts or omissions contained herein. Business development managers London, W11 1QQ, UK Although the information provided is accurate as of Alan Lee Tel: +44 20 3708 4199 April 2016, be advised that this is a developing area. [email protected] Fax: +44 20 7229 6910

Adam Sargent © Law Business Research Ltd 2016 Printed and distributed by [email protected] No photocopying without a CLA licence. Encompass Print Solutions First published 2000 (ISSN 1471-0447) Tel: 0844 2480 112 Dan White Seventeenth edition [email protected] ISSN 2044-7183

Global overview 7 Ghana 112 Laurent Garzaniti, Natasha Good and Hein Hobbelen Porcia Lauretta Mawuena Agbo Freshfields Bruckhaus Deringer LLP and Susan-Barbara Adjorkor Kumapley Bentsi-Enchill, Letsa & Ankomah Net neutrality update for the United States 10 Julie A Veach Greece 117 Harris, Wiltshire & Grannis LLP Dina Th Kouvelou and Nikos Th Nikolinakos Nikolinakos – Lardas & Partners Law Firm Smart cities 12 Angus Henderson and Daryl Cox Hong Kong 123 Webb Henderson Chuan Sun and Diane Ng Freshfields Bruckhaus Deringer Angola 16 António Vicente Marques India 130 AVM Advogados Atul Dua, Gaurav Dhwaj and Arjun Uppal Seth Dua & Associates Australia 22 Simon Muys, Peter Waters and Adelina Widjaja Indonesia 137 Gilbert + Tobin Agus Ahadi Deradjat, Kevin Omar Sidharta and Serafina Muryanti Ali Budiardjo, Nugroho, Reksodiputro Austria 30 Bertram Burtscher and Gernot Fritz Freshfields Bruckhaus Deringer LLP Ireland 145 Helen Kelly Matheson Belgium 36 Laurent Garzaniti, Hein Hobbelen and Anneleen Straetemans Freshfields Bruckhaus Deringer LLP Italy 153 Tommaso Salonico and Luca Ulissi Freshfields Bruckhaus Deringer LLP Brazil 45 Ricardo Barretto Ferreira and Paulo Brancher Barretto Ferreira e Brancher Sociedade de Advogados (BKBG) Japan 161 Chie Kasahara Atsumi & Sakai Bulgaria 51 Violetta Kunze and Milka Ivanova Djingov, Gouginski, Kyutchukov & Velichkov Macedonia 166 Gjorgji Georgievski and Marko Najdenovski ODI Law Firm Canada 59 Laurence J E Dunbar, Leslie J Milton, Scott M Prescott and Stephen P Whitehead Mexico 173 Fasken Martineau DuMoulin LLP Julián J Garza C and Gustavo Díaz B Nader, Hayaux & Goebel, SC Chile 67 Alfonso Silva and Eduardo Martin Myanmar 179 Carey Chester Toh, Alroy Chan and Tan Jen Lee Rajah & Tann Singapore LLP China 75 Chuan Sun and Diane Ng Netherlands 185 Freshfields Bruckhaus Deringer Onno Brouwer, Winfred Knibbeler and Nima Lorjé Freshfields Bruckhaus Deringer LLP European Union 86 Laurent Garzaniti, Thomas Janssens, Hein Hobbelen New Zealand 191 and Alexia Burckett St Laurent Jordan Cox and Alexandra Blair Freshfields Bruckhaus Deringer LLP Webb Henderson

France 97 Nigeria 197 Jérôme Philippe and Aude Guyon Tamuno Atekebo, Otome Okolo and Chukwuyere E Izuogu Freshfields Bruckhaus Deringer LLP Streamsowers & Köhn

Germany 105 Poland 204 Norbert Nolte, Theresa Ehlen and Christoph Werkmeister Eligiusz Krześniak and Piotr Chochowski Freshfields Bruckhaus Deringer LLP Squire Patton Boggs

2 Getting the Deal Through – Telecoms and Media 2016 © Law Business Research 2016 CONTENTS

Portugal 210 Taiwan 249 Nuno Peres Alves Robert C Lee Morais Leitão, Galvão Teles, Soares da Silva & Associados YangMing Partners

Russia 217 Turkey 254 Igor Gerber, Andrey Filippenko and Olga Melekhina Gönenç Gürkaynak and İlay Yılmaz Freshfields Bruckhaus Deringer LLP ELIG, Attorneys-at-Law

Singapore 223 Ukraine 260 Chong Kin Lim, Charmian Aw and Shawn Ting Volodymyr Igonin and Taisiia Asadchykh Drew & Napier LLC Vasil Kisil & Partners

South Africa 237 United Kingdom 266 Ridwaan Boda, Anneke Meiring, Mpho Thulare and Mpho Rod Carlton, Mark Sansom, Olivia Hagger Manyala and Matthew Sinclair-Thomson ENSafrica Freshfields Bruckhaus Deringer LLP

Switzerland 243 United States 280 Marcel Meinhardt, Astrid Waser and Mario Strebel Kent Bressie, Paul Margie, Julie A Veach and Michael Nilsson Lenz & Staehelin Harris, Wiltshire & Grannis LLP

www.gettingthedealthrough.com 3

Ukraine

Volodymyr Igonin and Taisiia Asadchykh Vasil Kisil & Partners

Communications policy The Telecommunications Law establishes the exhaustive list of telecommunication services subject to licensing in Ukraine, namely: 1 Regulatory and institutional structure • the provision of local, intercity and international fixed-line telephone Summarise the regulatory framework for the communications services, with the right to maintain and operate telecommunication sector. Do any foreign ownership restrictions apply to networks and lease communications channels; communications services? • the provision of local, intercity and international fixed-line telephone services using wireless access to the telecommunication network, with The fundamental laws regulating telecommunication networks and provi- the right to maintain and operate telecommunication networks and sion of telecommunication services in Ukraine are the Telecommunications lease communications channels; Law (2003) and the Radio Frequency Law (2000). • the provision of mobile services, with the right to maintain and operate The Telecommunications Law sets out the basic principles of telecom- telecommunication networks and lease communications channels; and munications market regulation, public use of telecommunication networks, • the provision of maintenance and operation services of telecommuni- rules of interconnection, the telecommunication services that are subject to cation networks, on-air and cable broadcasting and television networks. licensing, requirements for obtaining telecommunication licences, a list of public telecommunication services, conditions for providing telecommu- According to the Radio Frequency Law, the use of radio frequency resources nication services, and principles of granting numbering resource and tariff in Ukraine is subject to licensing. policy regulation. If the licensing activity requires the use of the numbering resource (pro- The Radio Frequency Law establishes general rules for allocation and vision of fixed-line telephone services, mobile services), the telecoms oper- use of the radio frequency spectrum, requirements for obtaining licence for ator must obtain the permit for the allocation of the numbering resource the use of radio frequency resources and permits for the use of certain types from the NCCIR. of radio electronic facilities or emitters, state control and monitoring of the According to the Radio Frequency Law, the licensees are required to use of radio frequency spectrum and liability in the event of its misuse. obtain permits for the operation of certain types of radio electronic facilities The terms and conditions of telecommunication services provision are or emitters if they are listed as radio electronic facilities and emitters that also regulated by the by-laws of the respective state authorities, namely require operation permits. the Rules on rendering and obtaining telecommunication services (the According to both the Telecommunications Law and the Radio Telecommunication Services Rules), and licence terms on rendering tel- Frequency Law, the validity term of the telecommunication licences and a ecommunication services subject to licensing in Ukraine, etc. According licence for the use of radio frequency resources is determined by the NCCIR to the Telecommunications Law, the rendering of telecommunication ser- individually, but may not be less than five years. The licence term may be vices in Ukraine may be provided by legal entities or individuals (ie, private extended upon the licensee’s application. entrepreneurs) registered in Ukraine. The licence fee depends on the type of telecommunication services the There are no ownership restrictions on foreign ownership or invest- licensee is seeking to provide. The licence fee for the provision of interna- ment in the telecoms and internet sectors in Ukraine. The existing regu- tional fixed-line telephone services is 8,993,000 hryvnas. The licence fee lations (including licensing rules concerning telecommunication services for the provision of mobile services and the provision of intercity fixed line subject to licensing) apply to telecoms operators or providers regardless of services is 340,000 hryvnas; the fixed licence fees for the provision of other their ownership structure. telecommunication services vary between 340 and 102,000 hryvnas. The transfer or assignment to another entity of telecommunication 2 Authorisation/licensing regime licences and permits is prohibited. However, the radio frequency used by Describe the authorisation or licensing regime. telecoms operators under the respective licence may be reallocated upon the joint application of telecoms operators to increase the efficiency of its The general authorisation regime in Ukraine applies in cases where tel- use. However, the licence is not transferred in such a case. ecommunication networks and services are not used for profit-making 3G is available to Ukrainian subscribers. The subsidiary of the major purposes but are for private or internal use by legal entities or individuals. telecoms operator of fixed and mobile telecommunication services General authorisation covers, among other things, the following: Ukrtelecom JSC – Trimob LLC – was the first telecoms operator to obtain a • the use of numbering resource by end-subscribers (mobile and fixed 3G licence in November 2011 without a public auction. The other three major telecommunication services users); Ukrainian telecoms operators – Astelit (trademark: lifecell), MTC-Ukraine • the use of radio frequency resources in Ukraine for the satisfaction of (rebranded to Vodafone) and Kyivstar – bought their 3G licences in a public own needs in radio communication; and tender in February 2015. MTS and Kyivstar have each paid the equivalent of • the operation of some types of radio electronic facilities and emitters approximately €85 million to the state budget for their licences under the listed as radio electronic facilities and emitters that do not require official exchange rate set at the bidding date while Astelit paid the equiva- operation permits. lent of approximately €105 million. The conversion will cost these operators around an additional €50 million on top of their licence fees. NCCIR issued Individuals and legal entities that intend to provide telecommunication all three licences for the term of 15 years. services to third parties for profit-making purposes must be included in 4G licences have not been granted to any telecoms operator so far. the register of telecoms operators and providers. Furthermore, in cases In June 2015, the President of Ukraine announced the tender for the 4G specified by the law, they should additionally obtain a respective licence licences in 2017, and the NCCIR is in charge of necessary arrangements. and/or permit from the National Commission for the State Regulation of Communications and Informatization (NCCIR).

260 Getting the Deal Through – Telecoms and Media 2016

3 Flexibility in spectrum use The retail prices for services of mobile operators are not state-regulated Do spectrum licences generally specify the permitted use and are subject to ex-post regulation. or is permitted use (fully or partly) unrestricted? Is licensed 5 Structural or functional separation spectrum tradable or assignable? Is there a legal basis for requiring structural or functional Spectrum use is regulated by the NCCIR. separation between an operator’s network and service Under the Radio Frequency Law, the following activities are subject to activities? Has structural or functional separation been individual authorisation: introduced or is it being contemplated? • use of radio frequencies for telecommunication activities (licence for use of radio frequencies); and Telecoms operators are not generally subject to accounting, functional or • use of radio, electronic or transmitting devices (permit for use of radio, legal separation. However, under the Telecommunications Law, there is a electronic or transmitting devices) unless such devices are specifically separation of administrative and regulatory functions in the telecommu- excluded. nications sector. Legal entities or individual entrepreneurs providing telecommuni- The use of radio frequencies by telecoms operators for the purpose of pro- cation services may act as either telecoms operators or providers. Unlike viding telecommunication services is subject to licensing in Ukraine. The telecoms operators, telecoms providers render services based on the licence is granted by the NCCIR to a telecoms operator for a period estab- agreement with the telecoms operator and a copy of the operator’s tele- lished by the NCCIR, but not less than five years. The licence is granted communication licence. to a particular legal entity and cannot be transferred to a third party. The Telecoms providers may not render telecommunication services, licence for radio frequency use shall contain information on allocated which are subject to licensing. Additionally, telecoms providers may not channels of radio frequencies, terms of its development, and regions or obtain the numbering resource, assign it to end-subscribers (secondary cities where radio spectrum will be used and a reference to a licence on allocation of numbering resource) and interconnect telecommunication rendering telecommunication services obtained by the applicant. The networks. Therefore, except for functional separation, both telecoms intended use of the spectrum shall be in line with the licence on rendering operators and telecoms providers are not subject to accounting or legal telecommunication services granted to the telecoms operator. separation. The radio frequency spectrum may be granted on a competitive (through tender or auction) or non-competitive basis. Where the demand 6 Universal service obligations and financing for the radio spectrum exceeds its availability, the licence is granted on a Outline any universal service obligations. How is provision of competitive basis. The NCCIR established the procedure and conditions these services financed? for granting a radio frequency licence on a competitive basis. Ukrainian telecoms regulations operate with the term ‘public tel- 4 Ex-ante regulatory obligations ecommunications services’ instead of the term ‘universal service’. The Telecommunications Law qualifies as public telecommunication services Which communications markets and segments are subject to the following: ex-ante regulation? What remedies may be imposed? • the connection of the end-subscriber to the telecommunication net- Ukrainian law allows telecoms operators to set tariffs for telecommunica- works of public fixed-line telephony (universal access); tions services rendered to subscribers. However, the Telecommunications • fixed telecommunication services within the numbering zone (local Law establishes the list of telecommunication services with maximum tar- fixed telecommunication); and iffs approved by the NCCIR. • calls to an emergency, information and communication services using Also, the NCCIR approved the List of telecommunications services payphones. markets in Ukraine subject to ex-ante regulation, which includes seven retail and 10 wholesale markets, namely: The concept of establishment of the Universal Service Fund and its fund- • access to the fixed-line public telephone network for customers ing has been actively discussed by key telecoms players and the NCCIR (individuals); since 2008. The recent draft laws regarding the establishment of the • access to the fixed-line public telephone network for customers (legal Universal Service Fund were filed with the Ukrainian parliament on entities); 27 December 2013. The draft laws are aimed at providing access to publicly • publicly available local and/or intercity fixed-line telephone services available telecommunication services to end-subscribers in rural, moun- provided for customers (individuals); tainous regions and vulnerable groups of consumers such as low-income • main international fixed-line telephone services, provided for custom- families, seniors and disabled persons. The funds of the Universal Service ers (individuals); Fund are supposed to be contributed by telecoms operators and telecoms • publicly available local and/or intercity fixed-line telephone services, providers rendering telecommunication services. Each operator and pro- provided for customers (legal entities); vider is supposed to pay a mandatory fee of 3.5 per cent of the income • main international fixed-line telephone services, provided for custom- accrued from rendering telecommunication services to the Universal ers (legal entities); Service Fund. • provision of telecommunications channels up to 2Mbit/s to end This initiative was not supported by the telecoms community, espe- customers; cially, not by telecoms mobile operators, and the draft laws were recalled in • call origination from the local fixed-line telecommunication networks March 2014. No other legislative initiatives involving the Universal Service of public use; Fund have been filed to the new Parliament re-elected in October 2014 for • call termination on the local fixed-line telecommunication network of the time being. public use; • transit services in the fixed public telephone network; 7 Number portability • wholesale access to subscriber’s lines for the purpose of provision Describe the number portability regime in your jurisdiction. voice and broadband access services; After the amendments of July 2010, the Telecommunications Law estab- • wholesale broadband access; lishes subscribers’ right for number portability and use of personal num- • wholesale services upon provision of telecommunications channels in bers. However, in practice subscribers still cannot enjoy this right for the telecommunications access networks into use; certain reasons. First, there was no statutory procedure for rendering num- • wholesale services upon provision of telecommunications channels in ber portability services; later the regulator passed the respective statutory the transport telecommunications networks into use; procedure, however, a special centralised database needs to be established • access and call origination of mobile telephone networks; before the operators can provide the respective services. • voice call termination on certain mobile networks; and In July 2015, the NCCIR passed new Regulations on Rendering Services • international roaming services at certain mobile networks. on Number Portability (the Number Portability Regulations), which was approved by the State Service of Special Communication and Information Protection of Ukraine, the Anti-Monopoly Committee of Ukraine and the www.gettingthedealthrough.com 261

State Regulatory Service of Ukraine. In practice number portability will be regulatory conditions. No government financial scheme to promote basic available for subscribers after the State Enterprise ‘Ukrainian State Centre broadband or NGA broadband penetration exists in Ukraine. However, in of Radio Frequencies’ establishes a centralised database and connects tel- June 2015, Parliament approved the Plan for Legislative Support to Reforms ecoms operators to it. As of January 2016, a tender for technical solutions in Ukraine (the Plan). Among other things, the Plan provides for introduc- required for number portability has been in progress. ing amendments to certain legislative acts of Ukraine to implement broadband internet nationwide. As of January 2016, the respective draft law has 8 Customer terms and conditions not yet been considered by Parliament. Are customer terms and conditions in the communications 12 Data protection sector subject to specific rules? Is there a specific data protection regime applicable to the The provision of communications services to end-subscribers by telecoms communications sector? operators and providers is regulated by the Telecommunications Law (2003), the Consumer Rights Protection Law (1991), the Personal Data The Telecommunications Law prohibits interception of telecommunica- Protection Law (2010), subordinate telecoms legislation. Such legislation networks, except as provided by law, and obligates telecoms operators tion, in particular, inludes the Telecommunications Services Rules, the and providers to take technical and organisational measures to protect tel- Procedure for Providing National Roaming, and Basic Requirements for ecommunication networks, communications, classified information about the Contract on Provision of Telecommunications Services, etc. The cus- the organisation of telecommunication networks and information trans- tomer terms and conditions are regulated by the Telecommunications mitted by these networks. Services Rules and public telecommunication services agreements estab- Unauthorised interference with the work of electronic computing lished by telecoms operators. machines (computers), automated systems, computer networks or tel- The telecoms legislation envisages the following rights for ecommunication networks and other infringements involving telecom- end-subscribers: munication networks are criminal offences and entail liability under the • free access to telecommunication services; Criminal Code of Ukraine. • safety of telecommunication services; Under the Telecommunications Law, telecoms operators and provid- • free choice of telecoms operator and telecoms provider; ers must ensure the preservation of information on consumers obtained • free choice of telecommunication services types and volume; during the conclusion of the contract on rendering telecommunication • obtaining comprehensive information on telecommunication services services and provision of telecommunication services. Such information and their value; is to be disclosed only under a specific procedure prescribed by Ukrainian • the right to demand an operator or provider to stop rendering services; legislation or upon written consent of the customer in question. • the right to refuse to pay for the services that were not ordered by the The Law on Data Protection in Telecommunication Systems (1994) end-subscriber; sets out basic principles of data protection in the telecommunications sec- • right to number portability and use of the personal number (see ques- tor, including data access procedure, relations between data owners, tel- tion 7); and ecommunication systems’ owners and the end-users, terms and measures • other rights stipulated by the law and telecommunication service of data processing, etc. Under the said law, the owners of telecommunica- agreement. tions systems are responsible for protecting the data. Owners of the telecommunications systems operating with state or restricted data are obliged 9 Net neutrality to create data a confidentiality service and should report to the respective Are there limits on an internet service provider’s freedom to state authority all security attacks. According to the Rules of Data Protection in Telecommunications control or prioritise the type or source of data that it delivers? Systems, the following data are protected: Are there any other specific regulations or guidelines on net • state information resources open data, as well as the open data regard- neutrality? ing the activities of the state authorities and military groups; Ukrainian legislation does not recognise the ‘network neutrality’ concept. • confidential data; Under the Telecommunications Law, based on the respective court • information constituting state secrets; and decision, telecoms operators must limit the access of their users to internet • information that is protected under the law. sites sharing child pornography. Telecoms operators may also disconnect terminal equipment used by the subscribers to commit illegal acts or acts 13 Big data that threaten national security interests, a fact that must be established by Is there specific legislation or regulation in place, and have the court. there been any enforcement initiatives in your jurisdiction, addressing the legal challenges raised by big data? 10 Platform regulation Ukrainian law does not establish any specific legislation or regulation Is there specific legislation or regulation in place, and have regarding big data. Neither have there been any enforcement initiatives in there been any enforcement initiatives, relating to digital Ukraine specifically addressing big data. platforms? The Ukrainian legal framework currently provides no specific legisla- 14 Key trends and expected changes tion or regulations relating to digital platforms. Still, it is notable that on Summarise the key emerging trends and hot topics in 21 October 2015 the Cabinet of Ministers with a reference to the Law on communications regulation in your jurisdiction. Access to Public Information passed a Resolution No. 835, which obligates the state authorities to publish certain data on a variety of areas relating to Among the emerging trends and hot topics in Ukraine there are, in particu- digital form. In particular, it is expected that this initiative will allow private lar, the following: developers to use these publicly available data in different state affairs in • expected implementation of subscribers’ right to number portability; their digital applications and solutions. • establishment, operation and funding of the Universal Service Fund; • deregulation of the telecommunication market, in particular, sub- 11 Next-Generation-Access (NGA) networks stitution of licensing for certain telecommunication activities by registration; Are there specific regulatory obligations applicable to NGA • adoption of a legal framework for getting access by telecoms operators networks? Is there a government financial scheme to promote to residential and other buildings, transport and electricity infrastruc- basic broadband or NGA broadband penetration? ture for telecommunications networks installation; and Ukrainian legislation does not establish any specific interconnection • granting of 4G licences by the state (see question 2). and access regulatory conditions or specific regulatory obligations to be applied to next generation (IP-based) networks. The operation of such net- Since 1 January 2016, the Ukraine-European Union Association Agreement works is governed by the general provisions of interconnection and access including the Deep and Comprehensive Free Trade Area has fully come

262 Getting the Deal Through – Telecoms and Media 2016

© Law Business Research 2016 Vasil Kisil & Partners UKRAINE into force, which, among other things, provides for the promotion of If the issuance of a licence takes place on a non-tender basis, the gradual approximation to EU law and regulatory framework in the sphere UNCTB decides whether to issue the licence within one month of receipt of information society and electronic communication. Ukraine will also of a respective application. gradually harmonise its laws with EU acquis in the information society and If the issuance of a licence takes place on a tender basis, such tender electronic communications sphere. shall be announced by the UNCTB through mass media at least 60 days before the expiry of the licence application submission deadline. The Media UNCTB shall make the decision on the successful bidder and the issuance of the licence within one month of the expiry of the application submission 15 Regulatory and institutional structure deadline. Summarise the regulatory framework for the media sector in Licence fees are calculated by the formula provided by the UNCTB your jurisdiction. for each type of the broadcasting depending on the size of the audience, broadcasting time, etc. The regulatory framework for the media sector includes the Civil Code of The minimum licence validity periods are seven years for over-the-air Ukraine (2004), the Law on Television and Radio Broadcasting (1993), the and multichannel broadcasting and 10 years for satellite, wire and cable Law on Copyright and Neighbouring Rights (1993), the Law of Ukraine on broadcasting. Public Television and Radio Broadcasting (2014) and other by-laws. Licensing of foreign television or radio organisations for broadcasting The Law on Television and Broadcasting governs the activities of TV in Ukraine is prohibited. and radio broadcasting organisations in the territory of Ukraine and sets forth the legal, economic, social and organisational terms of their opera- 18 Foreign programmes and local content requirements tions, aimed at the promotion of free speech and the rights of citizens to receive exhaustive, reliable and up-to-date information. Are there any regulations concerning the broadcasting The key Ukrainian regulator of the TV and media broadcasting sec- of foreign-produced programmes? Do the rules require a tor is the Ukrainian National Council on Television and Broadcasting minimum amount of local content? What types of media fall (UNCTB), which supervises compliance with the laws of Ukraine in the outside this regime? sphere of television and radio broadcasting. In April 2014, Parliament passed the Law on Public Television and Article 28 of the Law on Television and Broadcasting regulates broadcast- Radio Broadcasting, which provides for establishing of the National Public ing of foreign-produced programmes in Ukraine. Each television or radio TV and Radio Company of Ukraine (NPTRCU). According to the said law, organisation approves its broadcasting programme concept, including the the NPTRCU should consist of two TV and three radio channels aimed at maximum share of foreign audiovisual products, and then files such con- providing complete information to the public on social, political and cul- cept to the UNCTB for the purpose of obtaining a broadcasting licence. tural events in Ukraine and abroad. In April 2015, the first TV channel of The programme concept is an integral part of the broadcasting licence. public broadcasting was launched. There are some mandatory requirements to be followed when setting out the programme concept. In particular, between 7 am and 11 pm, tel- 16 Ownership restrictions evision and radio organisations (except for satellite broadcasting) must comply with the following Ukrainian-to-foreign programme ratios: the Do any foreign ownership restrictions apply to media services? European-produced programmes shall account for at least 80 per cent of Is the ownership or control of broadcasters otherwise broadcasting time, including at least 50 per cent of programmes produced restricted? Are there any regulations in relation to the cross- in Ukraine. For radio broadcasting the musical works of Ukrainian authors ownership of media companies, including radio, television and and performers must account for at least 50 per cent of the overall weekly newspapers? broadcasting volume. The above requirements are not applicable to online and mobile content. Article 12 of the Law on Television and Broadcasting prohibits incorporation of television and radio broadcasting companies by non-residents reg- 19 Advertising istered in one of the jurisdictions recognised by the Cabinet of Ministers as offshore as well as by the residents and legal entities of Russian Federation How is broadcast media advertising regulated? Is online due to the pending aggression against Ukraine. Further participation of advertising subject to the same regulation? such foreign legal entities and individuals in the said media companies is Under the Law on Television and Broadcasting, broadcast media advertis- also prohibited. ing and online advertising are regulated by the Law on Advertising (1996). Any other foreign entity is free to own or control Ukrainian broadcast- Broadcast media and online advertising are regulated by the same rules ers and media companies without any restrictions. as other types of advertising. For instance, restrictions imposed on adver- Apart from the foreign ownership restrictions, the Law on Television tising of alcoholic beverages and tobacco products also apply to broadcast and Broadcasting also prohibits the incorporation of television and radio media advertising and online advertising. broadcasting companies by: • the government bodies and self-governing authorities, legal entities, 20 Must-carry obligations incorporated by them, if decisions on their incorporation do not con- template the authority on the creation of broadcasting companies; Are there regulations specifying a basic package of • political parties, trade unions, religious organisations and legal enti- programmes that must be carried by operators’ broadcasting ties of the said; and distribution networks? Is there a mechanism for financing the • persons convicted of an offence and incapable citizens. costs of such obligations? Ukrainian law does not obligate television or radio operators to carry a 17 Licensing requirements basic package of programmes. The broadcasting programme concept What are the licensing requirements for broadcasting, determines the programmes for broadcasting by the operator. Under the including the fees payable and the timescale for the necessary Law on Television and Broadcasting, the core of the programming con- authorisations? ception of a broadcasting organisation must comprise the following programmes: analytical newscasts and social comment, culture and arts, A broadcasting licence issued by the UNCTB is the sole legal basis for the popular science and education, and entertainment. right to broadcast. The UNCTB issues licences for satellite, over-the-air, cable, wire and multichannel broadcasting. Depending on the type of 21 Regulation of new media content broadcasting, the licence may be issued on a tender basis (over-the-air, multichannel) or an application basis (satellite, cable, wire, on-air on the Is new media content and its delivery regulated differently broadcasting channel of a multinational on-air network, in cases stipulated from traditional broadcast media? How? by the law, NPTRCU broadcasting). Ukrainian law does not establish any specific requirements regarding new media content as compared to traditional broadcast media.

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22 Digital switchover 1+1 (1+1, 2+2, Unian TV, TET, Plusplus, Bigudi TV) and StarLight Media When is the switchover from analogue to digital broadcasting (ICTV, M1, M2, QTV, New channel, STB). Apart from the major players, a variety of smaller channels is available to subscribers. required or when did it occur? How will radio frequencies freed Only Ukrainian entities are allowed to incorporate broadcasting com- up by the switchover be reallocated? panies. Foreign investors, except for those specified in question 16, may In December 2010, the UNCTB amended and approved the new edi- acquire a shareholding in an existing broadcasting company. tion of the Electronic Media Development Plan (the Plan), which defines five stages for the switchover from analogue to digital broadcasting. The 25 Key trends and expected changes first stage of the Plan describes the order in which the digital TV network Provide a summary of key emerging trends and hot topics in should be created. The development of a nationwide network is expected media regulation in your country. to promote the simultaneous digital switchover of all nationwide channels, the regional public broadcasters and the leading local companies. The hottest trends in media regulation in Ukraine are the regulations on In August 2011, the UNCTB held the bidding contest for digital broad- the switchover from analogue to digital broadcasting, the decrease in the casting licences. As a result of the contest, 28 operators have been granted duration of advertising on TV and radio broadcasting, and the creation and digital channels in the nationwide TV network on the MX-1, MX-2, MX-3, operation of public TV and radio broadcasting (only one public TV channel MX-5 in DVB-T2 standard (MPEG-4), and eight of them obtained the right was launched in 2015). to broadcast in high definition. Eighty-four operators obtained digital fre- Furthermore, Ukraine undertook an obligation on the gradual approx- quencies with regional coverage. imation of Ukrainian laws with EU acquis in the sphere of audiovisual pol- At the same time, the share of analogue broadcasting is still substan- icy under the Ukraine–European Union Association Agreement. tial in Ukraine. Another hot topic appeared after Russian aggression in 2014 – neutrali- In February 2015, the UNCTB adopted amendments to the proce- sation of Russian propaganda in Ukrainian media. Thus, the court satisfied dure for digital switchover. The amendments provide four stages of ana- claims of the UNCTB and prohibited more than 18 Russian channels from logue switchoff for different regions of Ukraine during 2015–2016. At the broadcasting in Ukraine due to their anti-Ukrainian content. moment, Ukraine still may use respective radio frequencies for the provi- Furthermore, in the recent times, the so-called media services ‘on- sion of analogue broadcasting if it does not cause interference to digital TV demand’ (‘video-on-demand’, ‘audio-on-demand’, ‘catch-up TV’) are broadcasting in neighbouring countries. According to the latest announce- becoming more popular in Ukrainian media. In particular, multinational ments of the UNCTB, the switchover from analogue to digital broadcasting providers such as Netflix expanded to Ukraine in 2016. As a response to this will be entirely completed by mid-2017. trend, certain changes to media regulations may be expected.

23 Digital formats Regulatory agencies and competition law Does regulation restrict how broadcasters can use their 26 Regulatory agencies spectrum (multi-channelling, high definition, data services)? Which body or bodies regulate the communications and media The broadcasters use the spectrum based on the broadcasting licences and sectors? Is the communications regulator separate from the permits for transmitter use. Broadcasters are not required to obtain a sepa- broadcasting or antitrust regulator? Are there mechanisms to rate spectrum licence. The use of spectrum shall comply with conditions avoid conflicting jurisdiction? Is there a specific mechanism to envisaged by the Plan, broadcasting licence and permits for transmitter ensure the consistent application of competition and sectoral use obtained by broadcasters. regulation?

24 Media plurality According to the Telecommunications Law, the telecommunications industry in Ukraine is regulated by the Cabinet of Ministers, the NCCIR Is there any process for assessing or regulating media plurality and other governmental authorities. The Cabinet of Ministers and the (or a similar concept) in your jurisdiction? May the authorities NCCIR are responsible for state regulation of the telecommunications require companies to take any steps as a result of such an industry. The NCCIR is the principal state authority responsible for set- assessment? ting up standards and technical requirements for telecommunication Ukrainian law does not recognise the concept of ‘media plurality’. networks, allocating radio frequency spectrum and numbering resource, Meanwhile the audiovisual media distribution market is highly competitive ensuring their effective use, establishing licensing and registration proce- and is represented by the following major media holdings: UA Inter Media dures, establishing tariffs in respect of public telecommunication services, Group (Inter channel, Enter Film, K1, K2, MEGA, NTN, MTV Ukraine), regulating interconnection and applying penalties to telecoms operators Media Group Ukraine (Ukraine channel, NLO TV and Indigo TV), Studio and providers etc. The NCCIR is subordinate to the President of Ukraine and is regulated by the Acts of the Cabinet of Ministers.

Volodymyr Igonin [email protected] Taisiia Asadchykh [email protected]

17/52A Bogdana Khmelnitskogo Str. Tel: +380 44 581 7777 Kiev 01030 Fax: +380 44 581 7770 Ukraine www.vkp.ua

264 Getting the Deal Through – Telecoms and Media 2016

Another authority is the State Service for Special Communication and 27 Appeal procedure Information Protection of Ukraine (SSCIP), which acts as a central execu- How can decisions of the regulators be challenged and on what tive body with special status according to the respective Law on SSCIP bases? (2006). The SSCIP’s main tasks are implementing the state policy on protection of state information resources within data networks, maintenance Any decision or prescription of the NCCIR or another regulator may of the national system of confidential communication, cryptographic be appealed by an individual or legal entity to the administrative court. and technical protection of information. The SSCIP is coordinated by the Decisions of the AMC may be appealed in the commercial court. The basis Cabinet of Ministers of Ukraine and subordinated to the Parliament of for such appeal will be the infringement by a respective regulator of certain Ukraine. Among other things, the SSCIP supports the President of Ukraine, claimant’s rights and interests granted by Ukrainian legislation. the Chairman of the Parliament, the Prime Minister of Ukraine and other officials of state agencies with government communication. 28 Competition law in the communications and media sectors Also, the state enterprise Ukrainian State Radio Frequencies Centre Describe the key merger and antitrust decisions in the provides all state-related services concerning the allocation and use of the communications and media sectors adopted over the past year radio frequency spectrum in Ukraine. The NCCIR supervises the Centre. The Antimonopoly Committee of Ukraine (AMC) is a state authority by your antitrust authority. with a special status, ensuring state protection of competition in economic In October 2015, the AMC granted merger clearance to Mobile TeleSystems activity covering the telecommunications domain as well. The AMC is (MTS) PJSC (Russia) for the indirect acquisition (via Telecom Projects LLC subordinate to the President of Ukraine. The NCCIR, however, may be (Russia) and Baggio Holding BV (Netherlands)) of the controlling share involved in competition issues in this area as the NCCIR is competent to in JSC NVision Group (Russia), including the Ukrainian division. NVision assess the level of competition in the telecommunications market and Group designs IT and communications solutions and services. identify entities having substantial market power on it. In December 2015, the AMC granted merger clearance to Telesvit LLC The powers and responsibilities of each authority are set out in respec- (trademark: Volia), the leader of the Ukrainian telecommunications mar- tive laws. ket, for acquisition of the controlling stake in Normatek LLC (Ukraine), a Ukrainian wireless operator that owns a licence in the 5.5GHz band nationwide. With regard to antitrust violations in the communications sector, in December 2015 Zeonbud LLC (Ukraine), a provider of digital television, was found guilty by the AMC of abuse of dominance by implementing abu- sive tariff policies. The AMC imposed a fine of approximately €1.7 million.

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