Brussels, 14 July 2003
Commissioners Liikanen and Monti ready to take up new tasks in telecommunications policy
With ten more days to go before the 25 July date for the transposition of the new Framework Directive for electronic communications networks and services, Commissioners Liikanen and Monti will tomorrow host a workshop in Brussels. This workshop will focus on the Commission's oversight role under Article 7 of the Framework Directive. It will present the Commission's preparations regarding the procedures envisaged for notifications of intended measures by Member States' regulators under Article 7. Tomorrow's workshop will be open to anyone with an interest in how this consultation will work in practice, in particular service providers and public authorities. In the afternoon, a special meeting is scheduled with the relevant authorities, in particular the national regulatory authorities, the national competition authorities and ministries.
“The new consultation proceedings take the best of both competition law and sector specific legislation. National regulators will apply the resulting principles in a coherent manner aimed at stimulating the growth and development of a wide variety of electronic communications” Commissioners Monti and Liikanen stated.
The new regulatory framework gives the European Commission powers to oversee the national regulatory regimes, by way of the consultation and transparency procedures known as the Article 7 mechanism. This mechanism represents one of the most important changes to regulation of EU electronic communications markets, as it obliges national regulators to conduct a “national” and a “Community” consultation on the regulatory measures they intend to take. If necessary, the Commission can require national regulators to withdraw intended measures. This veto power must be exercised within very tight deadlines foreseen in the framework.
Ten days before the transposition of the Framework Directive into the national laws of all Member States, the moment has come to highlight the Commission's work in order to get ready for the consultation process set forth in Article 7. The focus of the workshop will be the practical application of the Commission's review powers on envisaged national regulatory measures in the field of electronic communications. The consultation process is a key instrument ensuring that the new Directives are applied in a transparent way. It is crucial to help ensure the consistent application of the new framework across the EU. The Commission attributes great importance to the Article 7 process and two Commission services from two different Directorate-Generals, the Competition DG and the Information Society DG, will jointly enjoy and exercise the review power vis-à-vis regulators' draft regulatory measures given to the Commission.
In order to make the new Community consultation process a success, the Commission has allocated all the necessary resources to this task. Dedicated teams have been set up in both Directorate-Generals concerned, and they are already working very closely together. To allow for a smooth transition to the period after 25 July, when first notifications under the new consultation mechanism will have to be dealt with by the Commission, several so-called pre-notification meetings were held with national regulators.
On 7 March 2002, Council and Parliament adopted a new regulatory framework for electronic communications networks and services which will enter into force on 25 July 2003. The main aim of this new legislative package is to introduce a lighter but comprehensive and technology-neutral Framework based on competition law principles. The new framework also aims at streamlining the entire regulatory process by limiting ex ante regulation to what is strictly necessary and by rendering the regulatory process as transparent as possible. It adapts the existing rules to take account of the convergence between telecommunications, information technology and media in evolving markets, where the same services can be delivered over a variety of platforms and received via a range of different terminals.
The new legislation will roll back ex ante regulation as competition becomes effective on specific markets. An operator will be subject to regulatory obligations only if it is designated as having Significant Market Power (“SMP”). An operator is deemed to have SMP if it is in a dominant position within the meaning of Article 82 of the EC Treaty. Thus, whether operators are faced with ex ante regulation or find themselves involved in ex post antitrust proceedings, they should have the legal certainty that issues such as “relevant market” and “market power” will have the same meaning irrespective whether the proceedings in question are initiated by national regulators or competition authorities. Ultimately, sector specific regulation should lead to further de-regulation, limiting thus the scope of ex ante regulation to areas where competition law instruments cannot be effectively applied.
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