The European Commission has issued a recommendation asking the Austrian regulator, RTR (Rundfunk & Telekom Regulierungs-GmbH) to amend or withdraw its proposal to allow Austrian operators to differentiate fixed and mobile termination rates based on the Member State from which the call originates.
In its draft measure, RTR proposed higher price caps for calls originating in Member States which have not brought down mobile & fixed-line termination rates in line with the EU Recommendation on Termination Rates. Austria itself has implemented the EU-recommended model, without differentiating between EU countries of origin.
RTR's draft measure aims to address the financial losses on traffic incurred by Austrian operators which experience significant traffic flows with operators in some of the EU Member States which have not yet implemented the EU-recommended approach. RTR proposes to allow Austrian operators to charge a rate which corresponds to the one applied by operators in countries which have not implemented the Recommendation.
The Commission concluded that a measure adopting the origin of the call within the EU as the sole criterion for setting a higher rate, is not in line with the non-discrimination principle and it would deepen existing barriers in the internal market.
The Commission's request follows a three month investigation, during which BEREC, the body of European Telecoms Regulators, expressed its strong support for the Commission's position. The Commission now requests RTR to withdraw its proposal or to amend it so that the termination rates are set in line with EU telecom rules. In case RTR, after having taken the utmost account of the Commission's recommendation, does not decide to amend its draft proposal it has to provide a valid justification.
At the same time, the Commission acknowledges that the root cause of the imbalances which RTR's draft measure seeks to address is the fragmented approach to termination rates by national regulators in the EU. In its response to the Commission's recent public consultation on the review of the EU Termination Rates Recommendation, BEREC called upon the Commission to adopt binding measures in order to ensure a common approach. The Commission has already stated, in the context of its recent legislative proposal on the wholesale roaming market, that it is prepared to take timely and consequential action to this effect. Commissioner Günther H Oettinger, responsible for the Digital Economy and Society, has therefore announced today the launch of the necessary internal procedures with a view to the adoption before the end of 2017 of a Commission Decision on termination rates, which will be binding on all national regulators.
Termination rates are the rates telecom operators charge each other to deliver calls between networks, and each operator has the market power over access to customers on its own network. These costs are included in call prices paid by consumers and business. The 2009 Commission Recommendation on Termination Rates aims at harmonising these rates and bringing them down to a cost-efficient level. Whilst largely successful, some divergences, however, remain across the EU. In this respect, on 15 March the Commission launched a public consultation which aims to evaluate the impact of the Recommendation, to assess whether to maintain or amend it and to evaluate whether further action at EU level is needed to pursue the policy objectives of promoting competition, EU citizens' interests and developing the internal market.
Article 19 of the Framework Directive (Directive 2002/21/EC) empowers the Commission to adopt a binding decision, after having consulted BEREC and the Communications Committee, to address inconsistent regulatory approaches on telecoms markets which persist for more than two years following the adoption of a Commission Recommendation on the same subject matter and which create a barrier to the internal market.