The new regulatory framework for Electronic Networks and Services

DG Information Society206-04 1

The new regulatory framework for Electronic Networks and Services

Peter Scott

DG Information Society Brussels

European Commission


Data Protection DirectiveSpectrum

Decision

(Art. 95)

The new packageThe new package

Liberalisation

Directive

(Art. 86) Framework

Directive

(Art. 95)

Authorisation Directive

Access & Interconnection Directive

Users’ Rights Directive


ContentsContents

1. Background and Objectives

2. Key features of new framework

3. On-going regulatory issues

4. Next steps


EU Telecoms PolicyEU Telecoms Policy1987-19981987-1998

THE GOAL

to create a flourishing single market for telecommunication services and equipment in Europe, providing users with choice, quality and value for money


Problems with current legal Problems with current legal framework framework

Long and complex individual licensing procedures in some Member States

Not enough flexibility to cope with rapidly changing / converging markets

Not enough consistency in how rules are applied in Member States

Designed for a newly liberalised market, not one moving to a fully competitive market without sector specific rules


General principles set for new General principles set for new regulatory frameworkregulatory framework

be the minimum necessary to achieve goals balance sector-specific legislation and

competition rules protect users where market forces do not be open, flexible, adaptablestimulate investment and provide legal

certainty be technologically independent, as far as

possible


Objectives for NRAsObjectives for NRAs

Promote competition

Contribute to the development of the internal market

Promote the interests of the citizen


Objective - Promoting Objective - Promoting competitioncompetition

users to get maximum benefit in terms of choice, price and quality

no distortion or restriction of competition

efficient investment in infrastructure; innovation

efficient use of radio spectrum and numbering resources


Objective - Contributing to the Objective - Contributing to the development of the internal marketdevelopment of the internal market

removing obstacles

encouraging trans-European networks, interoperability, end-to-end connectivity

similar treatment in similar circumstances - no discrimination

consistent regulatory practice and consistent application of rules

efficient use of radio spectrum and numbering resources


Objective - Promoting the Objective - Promoting the interests of the citizeninterests of the citizen

universal service, (including special social groups, eg disabled users)

high level of consumer protection, including simple and independent dispute resolution procedure

high level of data protection and privacy

provision of clear information, in particular tariff transparency

maintaining integrity and security of public networks


ContentsContents




4. Next steps


Content Services - outside scope of new framework

(e.g. broadcast content, e-commerce services)

Electronic communications Electronic communications networks and services - Scopenetworks and services - Scope

Communications services (e.g. telephone, fax, e-mail)

Communications networks (fixed, mobile, satellite, cable TV, powerline systems, networks used for radio and television broadcasting)

and associated facilities (e.g. CAS)


Key featuresKey features

Consistent treatment of all communications network infrastructures, including networks used for delivery of broadcast services

Dynamic process for identifying markets that justify ex-ante regulation

Simplification of market entry procedures (reliance on general authorisations)

Enhanced coordination between NRAs, and between Commission and NRAs

Alignment with competition law principles (market definition, dominance)


Rely increasingly on Rely increasingly on competition rulescompetition rules

Towards full competitionMonopoly

Amount ofregulation

19981990 2003

Competition Law

Pro-competitivesectorial telecoms Laws


ContentsContents




4. Next steps


Top 10 Regulatory issues Top 10 Regulatory issues in EU 15 in EU 15 (Nov 2001)(Nov 2001)

local loop unbundling

mobile call termination and international roaming

flat rate internet access

prices and delivery times for leased lines

tariff distortions and price squeezes


Top 10 Regulatory issues Top 10 Regulatory issues in EU 15 in EU 15 (Nov 2001)(Nov 2001)

numbering : carrier selection and pre-selection

rights of way

consumer protection

licensing conditions for 3G services

organisation and powers of NRAs


Local loop unbundlingLocal loop unbundling

Problem : slow implementation

Remedies : - hands-on monitoring by NRAs- binding deadlines - credible penalties- provision of wholesale DSL offerings in addition to ULL


Mobile call termination and Mobile call termination and international roaminginternational roaming

Problem : High cost of peak time call termination charges and international roaming charges in mobile networks

Remedy : Regulator needs to have the legal powers to impose obligations on operators (eg in resolving disputes)

+ Commission investigation into roaming charges


Leased LinesLeased Lines

Problem:Continuing high prices, lengthy delivery times and absence of cost orientation for leased lines, particularly for high speeds

Remedy:Effective implementation by operators of reporting mechanisms and cost accounting systems, to allow NRAs to verify costs and delivery times


Tariff distortions Tariff distortions and Price squeezesand Price squeezes

Problem :Persisting tariff distortions and price squeezes (between wholesale and retail prices)

Remedy :Better verification by NRAs of operators’ regulatory accounts


NumberingNumbering

Problem :Full range of carrier selection and pre-selection services not always available

Remedy :NRAs to impose carrier selection and pre-selection for all types of call (including local, long distance and international calls)


Rights of WayRights of Way

Problem : Disparities in the roll-out of rights of way

Remedy :Clarify respective roles of NRA and local and municipal authorities


Consumer protectionConsumer protection

Problem :inadequate monitoring of service quality, price transparency and contract issues; lack of effective redress mechanisms

Remedy:NRAs to strengthen their activities with regard to consumer protection issues


Licensing of 3G servicesLicensing of 3G services

Problem :Disparities between licensing conditions in Member States

Remedy:Better co-ordination of future licensing rounds, as foreseen under Radio Spectrum Decision

http://europa.eu.int/ISPO/infosoc/telecompolicy/en/com2001-141en.pdf


National regulatory authorityNational regulatory authority

Problems:- assignment of powers - ability to resolve disputes rapidly- staff and resources

Remedy:Requires action at political level


Ensuring effectiveness of the Ensuring effectiveness of the regulatory authorityregulatory authority

Regulator needs to have the legal powers to impose obligations on operators (eg in resolving disputes)

Staff need to be equipped with the necessary technical, economic and legal expertise

Decision-making processes need to be impartial and transparent, and subject to an appeal procedure


Independence of Independence of Regulatory AuthorityRegulatory Authority

Independent of any operator or service provider

Independent of any government department that is a shareholder in an operator or service provider

Independent of political interference with regard to individual decisions


ContentsContents




4. Next steps


Next stepsNext steps

Commission- SMP Guidelines

- Recommendation on relevant markets, and possible Decision on trans-national markets

- List of Standards (Art 17 of Framework Directive)

- Art 86 Directive

Member States- transposition and preparatory market analysis

Council and EP- adoption of data protection Directive


New Groups and CommitteesNew Groups and Committees

Spectrum policy groupHigh level policy group established by Commission

decision, chaired by M State

Radio Spectrum Committeestandard comitology committee

with regulatory and advisory roles

Communications Committeestandard comitology committee

with regulatory and advisory roles

European Regulators group Chaired by a Regulator; aim is to to seek consistent

application of rules in all M States


Lisbon European Council Lisbon European Council March 2000March 2000

A “competitive and dynamic knowledge-based economy”

demands

“an inexpensive, world-class communications infrastructure”


For more information ...For more information ...

On DG Information Society:http://europa.eu.int/information_society/topics/

telecoms/index_en.htm

On the new legislation:http://europa.eu.int/information_society/topics/

telecoms/regulatory/new_rf/index_en.htm

On implementation issues:http://europa.eu.int/information_society/topics/

telecoms/implementation/annual_report/7report/index_en.htm

Documents

The new regulatory framework for Electronic Networks and Services