POLICIES :: eCommunications :: Reforming the current telecom rules
Reforming the current telecom rules
The current rules which govern the telecoms sector in the EU were agreed in 2002. In this fast-developing sector, the regulatory framework now needs to be revised, to ensure it continues to serve the best interests of consumers and industry in today’s marketplace. An agreement on the EU Telecoms Reform was reached by the European Parliament and Council of Ministers on 4 November 2009, after two years of discussion during the legislative process.
Telecoms Reform
Telecoms are more than ever central to our lives and work. Economic and
social activities alike have come to rely on telecoms services and
infrastructure. The sector is changing rapidly, however. Major developments
since the 2002 regulatory framework was agreed include the growth in
voice-over-internet (VOIP) telephony and the uptake of television services
through broadband lines.
In economic terms, the telecoms sector is one of Europe’s most important, with
annual turnover of around €290 billion, and around 4% of the jobs in the Union.
More widely, the prices charged by the telecoms sector represent a direct cost
of doing business in Europe. Liberalisation in the telecoms sector in the EU,
launched in the mid 1980s, has brought significant benefits for consumers. The
price of telecoms services have fallen, on average, by around 30% in the past
decade. Moreover, the introduction of competition has raised standards of
service all round, making former monopolies much more respondent to the needs of
consumers.
Further steps
Although EU action has brought major benefits, there is still work to be done
to create an effective internal market in telecoms, which would bring even
greater benefits to consumers and businesses alike. Today there are only a few
operators providing pan-European services, and one of the reasons is the
different ways in which national regulators have implemented the EU framework.
The internal market is fragmented, with the result that operators have to
package their services in different ways in different Member States, and satisfy
different regulatory requirements each time. That fragmentation is hindering
effective cross-border consolidation, and often blocking or delaying the entry
of new competitors to the market.
One aspect of the Commission’s proposals is to review the regulatory approach,
to ensure that national regulators have the appropriate tools and powers to
ensure fair competition. The successful introduction of the Roaming Regulation
in summer 2007 demonstrates that action at EU level can be effective in securing
benefits for consumers. The Commission is therefore proposing to create an
EU-level telecom market body to complement the national regulators.
A new European Telecoms Body that will help ensure fair competition and more
consistency of regulation on the telecoms markets has been set up. It will be
called BEREC (Body of European Regulators of Electronic Communications and will
replace the loose cooperation between national regulators that exists today in
the “European Regulators Group with a better structured, more efficient
approach. BEREC decisions will be taken, as a rule, by majority of heads of the
27 national telecoms regulators. A decision on the seat of BEREC still needs to
be taken by the Governments of the 27 Member States.
The Commission’s proposal to merge the existing EU agency ENISA, in charge of
network security, with the new European telecoms body was not accepted by
Parliament and Council. ENISA will thus continue as a separate agency until
2013, when this arrangement will have to be reviewed again.
Better tuned
Effective regulation is never too heavy. Whilst the reform will tackle some
areas where the current rules have still not opened up the market to competition
– notably where former incumbents continue to dominate – the Commission
recognises that the rules have worked in others. Therefore, it proposes to
remove the requirements for ex ante regulation in major parts of the telecoms
sector. In these markets, ex post regulation will become the norm, i.e.
operators will have to seek redress for any problems through application to the
competition authority and/or through the courts.
In the future, therefore, regulatory action will focus on those sectors of the
telecoms market where competition has so far been most restricted. That is not
to say that we will allow the achievements in improving services and reducing
costs to consumers in those markets where regulation will become lighter to be
reversed. Regulators will still monitor those sectors, and take action if
necessary – and the picture will vary from Member State to Member State. By
focusing regulatory efforts and resources on the sectors where it is most
needed, the Commission aims to win the greatest benefits for consumers, in the
shortest possible time.
Completing the reform
The agreed Telecoms reform is the result of four years of discussions. In 2007, the Commission proposed a review of the telecoms framework following two years of consultations with stakeholders, with national regulators and with users of telecoms services. The proposals were then discussed in the European Parliament and by Member State governments in the Council. Following the endorsement of the reform package by the European parliament in May 2009, only one issue had remained controversial between Parliament and Council. This was agreed to on 4 November 2009.
- Read more about the telecoms reform.