For a better understanding: The Court held (in the circumstances of this case) that a legal obligation to decrypt E2E communications is a disproportionate interference with the right to privacy. The law in question specifically obligated messengers such as Telegram to hand over communications alongside the "information necessary to decrypt electronic messages if they were encrypted". To come to that conclusion, it re…
*when no adequate safeguards against abuse are in place
Unfortunately it is not as straightforward as that it's incompatible altogether. Per this ruling, it's only incompatible when there are no good safeguards (they use the word "adequate" in one place and "suitable" in another, neither is very specific about what it means)