The ruling comes in response to a request for wholesale flat rates filed by German IP carrier MediaWays, which is owned by the Spanish network operator Telefónica.
MediaWays is a key supplier of network services to AOL Deutschland in Hamburg.
Steffen Müller, director of strategic projects at MediaWays, said the RegTP decision was a "step in the right direction" in creating a competitive carrier market and also in lowering prices for German Internet users.
Under the ruling, competitive carriers can receive from Deutsche Telekom discounted tariffs for dial-up Internet connections made to its public telephone network. The connections include both ISDN and analogue modems.
In turn, the carriers can offer wholesale flat rates to Internet service providers (ISPs), which can pass these on to their retail customers.
At present, only broadband DSL (Digital Subscriber Line) customers in Germany are offered flat-rate packages, which include both unmetered telephone connectivity and access to the Internet.
RegTP is also conducting a study of offering wholesale flat rates for dial-up narrowband access directly to ISPs, a spokesman said.
For more than two years, a dispute has been raging between the telecommunication watchdog and Deutsche Telekom over conditions that rival operators must meet to receive discounted tariffs. One of the most hotly contested conditions has been the number of interconnection points.
Today's decision allows operators with a so-called Class 3 licence for telephone service and with at least 475 points of interconnection to apply for the wholesale prices. The previous offer, rejected by most carriers, required more than 1,600 interconnection points.
Deutsche Telekom has six weeks to set a price for the wholesale offer, the RegPT spokesman said. "We must approve the tariff," he added. "If it is too high, we go back to the negotiating table."
Until now, Deutsche Telekom has demanded £1,577 a month for a multiplex connection with 30 channels. Each channel is capable of carrying data at speeds up to 64Kbps (bits per second).
Despite the DSL boom in Germany, demand for narrowband access remains high. AOL claims to have more than 450,000 requests for its narrowband service.