1. On 18 October 1995 the European Commission has adopted a Directive (based upon article 90 of the EC Treaty) concerning the abolition of the restrictions on the use of cable television networks for telecommunications services (Directive 95/51/EC, OJ 1995, L 256/49, hereinafter referred to as the "Directive"). The Directive brings cable television networks within the scope of the Services Directive of June 1990 (90/388/EC). The Directive provides that as of january 1, 1996, all restrictions on the exploitation of cable television networks for purposes other than the transmission of broadcasting programmes must be lifted, except for the public voice telephony service as defined in the Services Directive.

2. In an effort to comply with the Directive The Minister of Transport had already implemented the required measures into the proposals for the new (interim) telecommunications legislation which are currently under discussion in Parliament. Since the adoption process of the aforementioned legislation (commonly referred to as the "Interim Legislation") has been considerably slowed down, the deadline of January 1, 1996, provided in the Directive called for a swifter means of implementation.

3. Consequently, the Minister of Transport has recently issued a formal Announcement in the Official Gazette (OG 41 of 27 February 1996) stating that the restrictions set forth in article 22 of the Telecommunications Act (in Dutch: Wet op de telecommunicatievoorzieningen; "WTV") do no longer apply to cable television networks, save for the restrictions which relate to the public voice telephony service and the telex service as defined in the Services Directive.

4. As a result, cable television network operators are now allowed to offer on a commercial basis liberalized telecommunications services to third parties. The existing Official Announcements on the use of the fixed telephone network of the concession holder (i.e. KPN) for the provision of voice telephony services, published in the Official Gazettes of 1994, 103 ("closed user groups") and 1995, 84 ("dial in/dial out"), respectively, now apply correspondingly to the use of cable television network lines for the same purposes.

5. Furthermore, the operator of a cable television network is entitled to provide leased lines to third parties after it has been registered with the Ministry of Transport (i.e. the "Directie Toezicht Netwerken en Diensten van de HDTP", Postbus 90420, 2509 LK, Den Haag). Registration may be refused if considered detrimental to an efficient provision of telecommunications services and the level of competition to be established in the field to which the request for registration applies.

6. In order to prevent cross-subsidies large cable television permit holders are obliged to have a separate bookkeeping with respect to their activities as a provider of network capacity for telecommunications services. Such obligation exists if the turnover related to said activities amounts to more than 50 million ECU.

7. Finally, it is announced that the prohibition set forth in article 25.1 of the Telecommunications Act to link cable television networks to each other without using the telecommunications infrastructure of the concession holder will no longer be enforced.

8. As a result of the captioned Announcement two previously issued Announcements on the use of cable television networks for telecommunications services other than the transmission of broadcasting programmes (published in the Official Gazettes of 1989, 209 and 1994, 233, respectively) are withdrawn. In the near future the Ministrial Rules on the minimum size of cable television networks (Stcrt. 1944, 233) providing which cable television network permit holders are entitled to apply for an exemption of the prohibition to provide other services than the transmission of broadcasting programmes in order to offer leased lines to a mobile telecommunications infrastructure permit holder, will be cancelled as well.

For further information, please contact: Dirk van Oostveen, De Brauw Blackstone Westbroek, Tel: +31 70 328 5 328 or enter text search 'De Brauw Blackstone Westbroek' and 'Business Monitor'.

March 22, 1996