Until 1 May 1996, the Austrian telecommunications service was part of the federal administration; it belonged to the Postal and Telegraph Administration (PTV), which was under the authority of the Ministry for Transport. On 1 May 1996, the PTV was separated from the federal administration and converted into a joint-stock company (AG) under the name Post und Telekom Austria AG. In the summer of 1999, it was split into two companies, namely Telekom Austria AG and the Austrian Postal Service (Österreichische Post AG). Unlike the new postal company, Telekom Austria is mainly privately owned, with only 30.2 percent of its shares held by the Republic of Austria. These ownership rights are exercised by the Federal Ministry of Finance through the company Österreichische Industrieholding AG. The task of regulation is performed by the Austrian Regulatory Authority for Broadcasting and Telecommunications (RTR) and the Telecom Control Commission (TKK), an independent panel.

In accordance with the law of the European Union, the telecommunications market has been fully privatised since 1 January 1998. The initial legal framework for the newly privatised telecom sector was replaced by a new framework on 20 August 2003.

The new framework comprises the following instruments:

• European Parliament and Council Directive 2002/21/EC of 7 March 2002 on a common regulatory framework for electronic communications networks and services (Framework Directive),
• European Parliament and Council Directive 2002/20/EC of 7 March 2002 on the authorisation of electronic communications networks and services (Authorisation Directive),
• European Parliament and Council Directive 2002/19/EC of 7 March 2002 on access to, and interconnection of, electronic communications networks and associated facilities (Access Directive),
• European Parliament and Council Directive 2002/22/EC of 7 March 2002 on universal service and users’ rights relating to electronic communications networks and services (Universal Service Directive), and
• European Parliament and Council Directive 2002/58/EC of 12 July 2002 on the processing of personal data and the protection of privacy in the electronic communications sector (Directive on privacy and electronic communications).

This telecommunications package was transposed into Austrian law within the prescribed time limit by virtue of the Telecommunications Act 2003, the original version of which was promulgated in Federal Law Gazette (Bundesgesetzblatt), Part I, No 70/2003. All the essential requirements were met, such as the introduction of general authorisations in place of individual concessions, tighter enforcement of competition rules and improved powers of intervention for the regulatory authorities by virtue of strong regulatory instruments.

Since 1 November 1997, the telecommunications sector has been subject to regulation by an independent authority, the Austrian Regulatory Authority for Broadcasting and Telecommunications (RTR) and the Telecom Control Commission (TKK), which is not bound by the instructions of any authority. RTR is financed by the various operators and from the public treasury. Its role as the broadcasting regulator dates from 2001. The main responsibilities of RTR and the TKK are as follows:

• regulating competition in the telecommunications sector,
• arbitrating in disputes between operators and customers,
• regulating the assignment of telephone numbers,
• dealing with matters of consumer protection in the telecommunications sector, and
• awarding frequency bands by auction where demand exceeds supply.

From the wide range of rulings delivered by the Regulatory Authority to date, it may be stated that the main precepts of telecommunications regulation have now been defined.

Within this structure, the following responsibilities devolve upon the Federal Ministry of Transport, Innovation and Technology:

• continuing the development of telecommunications policy and legislation,
• conducting a centralised policy on frequencies,
• taking decision on rights of way, and
• awarding contracts for the provision of universal services.

Competition in Austria is keen. Austria has one of the highest rates of mobile-phone usage in Europe, and charges tend to be low. The respective market shares of the various service providers are as follows:

Market shares of mobile-communications service providers

Universal service in Austria consists in the provision of a fixed-line telephone service at an affordable price, in the nationwide provision of public telephones and in the operation of a directory and information service. Telecom Austria AG is the provider of this universal service. The Federal Ministry of Transport, Innovation and Technology conducts regular reviews to ascertain whether more than one operator would be able to provide the universal service at affordable prices throughout the entire country.

The last review, conducted in 2004, found that this was not yet the case in the domains of voice telephony and public telephones, and so the obligation to provide these services continues to rest with Telekom Austria. In addition, consideration is being given at the present time to the question whether it would be legally and politically expedient to end the universal-service requirement in the case of services in which there is a fully competitive market.