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EU telecoms market reforms unveiled

Out-Law News | 13 Sep 2013 | 8:10 am | 3 min. read

Telecoms operators will be able to operate on an EU-wide basis by obtaining a single regulatory authorisation to do so, under proposed reforms to the regulation of the EU telecoms market.

The European Commission on Thursday unveiled a draft single EU telecoms market and 'connected continent' Regulation. (73-page / 345KB PDF) The proposed reforms contain "simpler rules" designed to "help companies invest more and expand across borders", plans to drive more cross-border expansion by telecoms operators by coordinating the way radio frequency spectrum is allocated across the trading bloc, and a 'carrot and stick' approach to end roaming charges levied on consumers, amongst other measures.

Under the plans telecoms operators would be able to operate in all 28 EU member states by obtaining a single authorisation to do so from a national regulator. Currently the companies must obtain separate authorisations from each telecoms regulator in individual states.

"The Regulation introduces a single EU authorisation based on a single notification system in the Member State of main establishment of the European electronic communication provider (the home country) and sets out the conditions applicable to it," the Commission's proposals said. "The withdrawal and/or suspension of the Single EU authorisation are subject to home-country control."

"Holders of a single EU authorisation are entitled to equal regulatory treatment in similar situations within and across Member States and new entrants and smaller cross-border operators are exempted from administrative charges and contributions to the universal service financing in Member States other than the home country (host countries)," it said.

"Holders of a single EU authorisation will further provide services throughout Europe on the basis of greater consistent application of regulatory obligations. The single European authorisation will thereby reduce unnecessary administrative hurdles and guarantee European providers more consistent rights and obligations to operate across the EU and achieve scale," the proposals said.

Under the reform plans, radio frequency spectrum, used by mobile network operators (MNOs) to transmit data to consumer devices, would be allocated on a harmonised basis across national borders.

The European Commission would have the power to "harmonise spectrum availability, the timing of assignments and the duration of rights of use for spectrum".

"Mobile providers in Europe today lack the necessary predictability regarding spectrum availability across the EU and must deal with diverging assignment conditions," it said. "It is thus more difficult to plan long-term, to invest across borders and eventually to gain scale. Such a patchy situation means that device manufacturers design their products for other markets with greater scale and growth prospects."

The European Commission has also provided MNOs with two different options in an effort to cut premium roaming charges.

MNOs can currently charge consumers extra fees when those individuals access voice or data services abroad. Domestic MNOs face charges imposed by foreign operators to terminate connections on their networks so EU legislation currently allows MNOs to recoup money from consumers for doing so. However, existing EU regulations placed limitations on the amount MNOs can charge consumers for roaming.

Under the Commission's latest plans, MNOs would have to ensure that by July 2016 they offer their customers the chance to download data or make calls at "domestic rates" when in "at least 17 Member States representing 70% of the population of the Union", or alternatively allow customers to roam with alternative, cheaper, providers when abroad.

Operators will be able to enter into agreements with rival providers in other states in order to allow them to meet the 'domestic rates' obligations.

"Without bileteral [sic] or multilateral roaming agreements it is unrealistic to imagine that an operator alone would be able to provide roaming at domestic price levels throughout the whole Union in the envisaged time frame," the Commission's proposals said.

EU Commissioner Neelie Kroes said: "Our proposal on roaming builds on the existing rules by offering operators the incentive to gradually introduce retail offers in which domestic service rate applies both to domestic services and roaming services. It also puts an end to unjustified price distinctions between the price of national and 'international' (intra-EU) calls."

"EU consumers should not pay more for calling abroad or when they travel abroad.
The current roaming rules are designed to reduce the problems of national markets but they don’t build a real single market. The current rules were written before the economic urgency of establishing the telecoms single market was apparent. The current rules provide a safety net and a stick to complement the new opportunities and ‘carrot’ contained in this package.  Domestic mobile prices have consistently fallen alongside the previous three reductions in mobile roaming price caps. There is no evidence to suggest that eliminating roaming premiums will push these prices up," she said.

New 'net neutrality' rules were also set out by the Commission under its proposed reforms.