On September 15, 2020, the Court of Justice of the European Union (CJEU) interpreted for the first time Regulation 2015/2120, which enshrines the principle of net neutrality. In its judgment in Joined Cases C-807/18 and C-39/19 Telenor Magyarország Zrt. v Nemzeti Média-és Hírközlési Hatóság Elnöke, the Court was asked to give a preliminary ruling in relation to an internet service provider’s “zero tariff” service packages. According to a press release from the Court, Telenor, established in Hungary, offered its customers two “preferential access” packages under which “data traffic generated by certain specific applications and services” did not count toward the data consumption allowances purchased by customers. Moreover, the customers were able to continue to use those specific applications and services even after the allowance maximums had been reached. In practice, this meant that any measures imposed by Telenor to slow or block data traffic were not applied to these excepted applications and services. The Court was asked by the Budapest High Court whether Regulation 2015/2120 prohibited internet service providers from entering into agreements or practices that limit the exercise of the rights of end users of internet service agreements and, in particular, whether such actions are compatible with Article 3(3) of the Regulation, which provides for equal and non-discriminatory treatment of internet traffic.
After finding that the Regulation prohibits internet service providers from placing any limitations on the exercise of internet end users’ rights, the CJEU held that: (1) agreements such as the zero-tariff agreement in this case, are liable to limit end users’ rights in a way that is incompatible with the Regulation; (2) as subscriptions to such packages increase, it is more likely that “the cumulative effect of those agreements will result in a significant limitation of the exercise of end users’ rights, or even undermine the very essence of end users’ rights, a situation expressly referred to in [the Regulation]; (3) national courts need not assess the effect of such measures on end users’ rights in order to make a finding of incompatibility with the Regulation; and (4) blocking or slowing down measures must be based on “‘objectively different technical quality of service requirements of specific categories of traffic’, and not on ‘commercial considerations’.” The case will now be returned to the Budapest High Court for a decision in light of the CJEU’s preliminary ruling.