Posted on 29/Jan/2016
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European Commission’s plans to overhaul the telecoms rules across the bloc are most likely to encounter the hostility of a powerful, yet unsuspicious ‘lobby’: national regulators.

An opinion issued in mid-December by Berec, the Body of European Regulators for Electronic Communications, appears to anticipate a confrontation with Brussels.

The Commission has made a top priority to “break down national silos” in the sector’s regulation with the aim of building a genuine single market for telecoms.

Berec’s opinion is keen to stress that any such achievement “will always be the product of 28 competitive and well-regulated national markets”. While the executive president Jean-Claude Juncker recently proclaimed that he wants “to see pan-continental telecoms networks”, regulators respond that “physical networks are and will remain national.”

No need to be a telecom expert to guess that the two institutions may have diverging views. This is nothing new. Disagreements of this sort adumbrate a struggle of power that has been playing out for some time.

Telecom regulators stood firmly against several attempts by former digital commissioner Neelie Kroes to exert more control over their domestic decisions.

Now they fear that the upcoming reform might curtail their sway in national markets while increasing the Commission’s competences in what is meant to be a fresh shift of power.

Little wonder that Berec’s opinion appears to air scepticism at the idea championed by Brussels that the current rules governing the sector need a robust modernization as well as more harmonization.

By contrast, the organization is vocal in praising the existing legislation – although admitting improvements are required – precisely because it leaves regulators enough room for manoeuvre, namely the “ability to address the particularities of their national markets”.

Greater EU harmonisation should happen only where it makes sense, while preserving national differences, Berec argues. Thankfully, the Commission believes that a fair chunk of those differences are leading to overregulation or regulatory uncertainty that might hinder investment at a time Europe needs to accelerate the rollout of digital networks so as to compete with the rest of the world.

The mobile sector is a textbook case. Ensuring greater consistency in radio spectrum policies at EU level – a measure the Commission has announced to be part of the reform – will generate mobile network cost savings, as well as additional benefits associated with improved coverage, capacity and network performance, observers say unanimously.

And yet Berec does not appear to share this idea. To the contrary: It says that “top-down harmonization” might result “in inefficient use of” radio spectrum, “hampering rather than supporting innovation”.

The Commission is expected to unveil its proposal for the review of the EU’s regulatory framework for electronic communications as early as this spring.

These rules addressing the regulation of service provision, access, interconnection, users’ contractual rights and users’ privacy were last revised in 2007-2009. The reform constitutes one of the 16 strategic actions of the Digital Single Market strategy unveiled with great fanfare in May last year.

Berec’s opinions are not binding but must be taken in “utmost account” by the European Commission, according to the EU law, meaning they cannot be simply neglected, not least because telecoms regulators are often tasked with implementing the bloc’s rules.

It is worth noting that in the past years some regulators chose to ignore Brussels’ decisions or even the implementation of pieces of European legislation.

At the same time Berec voiced strong criticism at a bunch of key Commission’s proposals. For instance, it objected to a wide spectrum of measures put forward under the “Connected Continent” package, which was also designed to accelerate the building of a single telecom market.

That is why the European Commission should strengthen the dialogue with regulators before putting out the new legislation so as to minimize their influent opposition (in the past they lamented that they have been not consulted).

The fact is that further integration in the sector’s regulation is key for the future prosperity of the bloc and is a stepping stone towards a digital single market. Berec ought to come to terms with this basic truth even this means a loss of powers for the national regulators.

 

Photo credit: Jesse Loughborough
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