Recommendations and guidelines on competition issues
Article 7 of the Electronic Communications Framework Directive
Article 7 of the Electronic Communications Framework Directive (2002/21/EC) is the main EU regulatory instrument governing electronic communications. Under this Directive, the national regulatory authorities must analyse their national electronic communications markets in consultation with the industry and propose appropriate regulatory measures to address market failures that might be hampering competition. These findings and proposals must be notified to the Commission and other national authorities. The Commission ensures that the rules are applied consistently in all Member States, in cooperation with other national authorities.
As part of this notification mechanism, the Commission has established a list of "markets" for electronic communications that it considers should be the starting point for this national analysis. These markets are set out in the Commission Recommendation of 11 February 2003 on relevant product and service markets susceptible to ex ante regulation.
The Commission assesses the majority of cases within a month, after which it may choose to approve and/or comment on the proposals. However, if the Commission considers that the proposals would create a barrier to the single market or has serious doubts as to their compatibility with Community law, the Commission opens an in-depth investigation which lasts a further two months. If its concerns are confirmed following this in-depth investigation, the Commission may veto the proposed market definition or dominance analysis. It may also comment on the proposals.
The Article 7 framework contains pro-competitive incentives that require that ex-ante regulation must be withdrawn once competition is effective on a specific market. The objective of the framework is to allow new market entrants to offer their services initially via the infrastructure of the existing operator. The revenue generated by new market entrants should allow them to "climb the ladder of investment" and finally to invest into their own infrastructure. As soon as there are competing infrastructures, access regulation will be phased out, leaving the market subject only to competition law.
Two Commission Directorates General (DGs) implement the Article 7 mechanism. DG Information Society and Media is responsible for the regulatory framework, including the review of the Directives. The application of the Article 7 procedure is a joint responsibility with DG Competition. This guarantees a coherent application of competition law principles.
Examples of veto decisions include
- the markets for mobile access and international calls in Finland
- transit services in Austria and
- wholesale call termination on fixed networks in Germany.
More information on the Article 7 procedure can be found at on Europe´s Information Society thematic portal, including a list of notifications and the Commission decisions on these notifications.
Infringement procedures under Article 226
The liberalisation of the EU telecommunications sector has brought competition to this market, driving growth and innovation and providing the consumer with choice in selecting a supplier for a wider array of services. Moreover, new entrants have driven prices downwards. Market opening has been a progressive process, and the European Commission has used its powers under Article 86 of the Treaty to adopt, where necessary, relevant decisions and Directives.
If a Member State does not comply with the EU regulatory framework for electronic communications, the Commission can initiate infringement procedures under Article 226 of the EU Treaty against that Member State. For example, the Commission initiated an infringement procedure against Sweden as it had not abolished the exclusive rights of the broadcasting services company Teracom.
The Commission regularly publishes a a report on the state of implementation of the telecommunications regulatory package, with information on the latest market developments.
On 17 September 20089 the Commission as adopted new guidelines on the application of State aid rules to rapid deployment of broadband networks. (Read the press release and the frequently asked questions).