Annual report (20-F) - Ono

interconnection and/or access to their networks or associated facilities. The Access Directive sets out
objectives for national regulatory authorities with regard to access and interconnection.
Interconnection agreements are subject to the supervision of the CMT and to Spanish
regulations. Royal Decree 2296/2004 applies to Interconnection, Access to Public Networks and
Numbering. The Interconnection Decree requires Telefónica to submit a “reference interconnection offer”
(RIO) to the CMT containing, amongst others, its proposed price terms, which shall be cost-oriented. The
last interconnection reference offer is the RIO 2003.
The Interconnection Decree requires that unless the parties agree otherwise, interconnection
agreements must be reached within four months from the date of any request to start negotiations. In the
event the parties cannot agree on such terms, the CMT will decide the terms applicable to the related
interconnection agreement.
Access to the Local Loop
Until a new regulation implementing the new General Law on Telecommunications is enacted,
access to the local loop is governed by the Access to the Local Loop Royal Decree of December 22, 2000.
The Royal Decree provides for conditions in which operators of fixed telephony service available to the
public and fixed public telephony networks with significant market power, currently Telefónica, will
provide access to the local loop and related resources to the corresponding authorized operators. These
operators must publish a local loop offer, including, amongst others, the relevant technical and economic
conditions. According to this Royal Decree, tariffs for the provision by Telefónica of access to the local
loop must be cost-oriented.
The last local loop offer published by Telefónica was approved by the CMT on March 31, 2004.
Numbering and Operator Selection
In order to provide telecommunications services, operators need to be furnished with public
numbering resources, i.e. the ability to allocate phone numbers among subscribers or users of telephony
services in accordance with the applicable, government approved, National Numbering Plan. The CMT
has the authority to allocate numbers and must act within a maximum period, currently three weeks, from
the date of the relevant application.
The General Law on Telecommunications and the Royal Decree 2296/2004 address operator
selection, which refers to the ability of the subscriber or user to select a given operator for all or certain
calls. The operator to be used can be chosen ahead of time or on a call-by-call basis. The operator selected
must transport the calls effectively and efficiently. Operators with significant market power in the
provision of connection to and use of the public telephony network at fixed locations—currently
Telefónica—are obliged to provide operator selection. The Government is allowed to impose operator
selection obligations on other type of networks.
On August 2001, Circular 1/2001 issued by the CMT entered into force to establish the
instructions to implement preselection mechanisms for subscriber lines connected to digital telephony
switches for metropolitan calls, long distance and fixed-to-mobile calls. Additionally, as of March 1,
2003, and pursuant to Circular 2/2002 of the CMT, fixed-line public telephony network operators that are
obliged to implement operator selection mechanisms are required to offer preselection and selection on a
call-by-call basis for metropolitan, long distance and fixed-to-mobile calls to intelligent network
numbering (including personal numbering, but excluding collect call numbering) and to paging services.
Finally, pursuant to Circular 1/2002, issued by the CMT, Telefónica was obliged to implement
preselection mechanisms for subscriber lines connected to analog telephony switches prior to January 31,
2003, the date as of which this form of preselection was required to be available for long distance,
metropolitan and fixed-to-mobile calls under the same conditions as preselection offered to subscriber
lines connected to digital telephony switches.
Number Portability
Under the General Law on Telecommunications, users or subscribers shall have the right to keep
their existing telephone numbers when contracting for the same telecommunications services from a new
provider, in the cases to be established by the relevant implementing regulation. The General Law on
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