European telecoms reform

European telecoms reform

The European telecoms reform package has passed into law, but what does it mean for carriers and users?

The package, which became law at the end of December 2009 following agreement by parliamentarians and ministers to compromise over a hotly contested internet freedom amendment, encompasses an array of regulation so vast that an additional regulatory body has been established as part of the package. The authority, called the Body of European Regulators for Electronic Communications (BEREC), provides a means by which consistent regulation can be enforced across the 27 EU member states and strengthen the single European telecoms market.

How does BEREC work?

BEREC is made up of the heads of the EU member states’ domestic regulators. Its decisions are taken based on a two-thirds majority among those regulators. BEREC decisions are prepared with the support of independent regulators and the body also supports, advises and complements the work of national telecoms regulators.

Isn’t BEREC just an extra layer of regulation?

It provides an extra layer of policy setting and some commentators have questioned the need for yet another pan-European policy body – not least one with an initial budget of €5.5 million. However, BEREC does not have the power that EU Commissioner Viviane Reding had initially hoped for. Instead of being a super-regulator, BEREC merely has veto powers if it deems national regulators favour incumbent telecoms operators.

What are the key reforms in the package?

Elements of the package include giving European users the right to change their fixed or mobile operator in one working day while retaining their existing number. Currently, in the EU it takes on average 8.5 days to change a mobile provider and 7.5 days for a fixed-line provider change. In addition, carriers must offer consumers the possibility of a contract with a maximum duration of no longer than 12 months.

The package also includes a new internet freedom provision which insists that disconnection of an internet user for unlawfully file-sharing copyrighted material can only occur following a fair and impartial procedure.

Other elements include requirements for better consumer information, improved consumer protection against personal data breaches and spam, better access to the pan-European emergency services number 112 and a new say for the European Commission on competition remedies for the telecoms market.

What’s in the package that addresses network capacity?

The Commission has made a political commitment to scrutinise net neutrality. To that end, national regulators will be empowered to set minimum quality levels for network transmission services thereby limiting carriers’ scope to prioritise high value traffic, such as IPTV, over commoditised traffic such as VoIP. The Commission plans to accelerate broadband access for all Europeans through the better management of radio spectrum and by making such spectrum effectively available for wireless broadband services in regions where deployment of new fibre is too costly. This element of the package targets the radio spectrum freed up as a result of the switchover from analogue to digital television.

What about access networks?

The package makes provision for encouraging competition and investment in next-generation access networks. New rules have brought legal certainty for investment in next-generation access networks and reaffirm the importance of competition in the sector while preserving incentives to invest by taking into account the risks involved in allowing access to such networks.

Anything else to consider?

The package also makes provision for functional separation as a means to overcome competition problems. National regulators are empowered to oblige carriers to separate their networks from their service operations, as a last resort remedy. This has been advocated by the 27 regulators and the Commission since 1997 and has been implemented in the UK since 2006, where it triggered a surge in broadband connections. The EU rules enshrine functional separation, providing legal certainty for countries moving to different forms of separation, such as Poland and Italy, while ensuring overall consistency for the benefit of the single market, effective competition and consumer choice.

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