The Commission decided today to send a letter of formal notice to Italy on the regulation of telecom markets and on the margin of discretion of the regulator (AGCOM).

Independence of national regulatory authorities is a fundamental principle of EU telecom rules. For instance, regulators should not seek or take instructions from any other body in relation to market regulation.

At stake is an amendment to Italian law, aiming at 'unbundling' the provision of wholesale network access by Telecom Italia from the activation or maintenance of lines i.e. the so called ancillary services. The law in question would prescribe one particular solution and thus pre-empt the discretion of AGCOM. According to the European Commission AGCOM should be able to address any potential competition issue independently.

The Commission points out that the Regulatory Framework aims at ensuring that the national regulatory authorities (NRA) have a broad discretion in order to be able to determine the need to regulate a market according to each situation on a case-by-case basis and that it is for the NRAs, and not the national legislatures, to balance the objectives referred to in Article 8 of the Framework Directive when defining and analysing a relevant market which may be susceptible to regulation.