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Telecoms: Commission approves Italian regulator's plans to boost competition in the Italian terminating segments of leased lines market

European Commission - IP/09/1882   07/12/2009

Other available languages: FR DE IT

IP/09/1882

Brussels, 7 December 2009

Telecoms: Commission approves Italian regulator's plans to boost competition in the Italian terminating segments of leased lines market

The European Commission has today approved the draft plans of AGCOM, the Italian telecoms regulator, to regulate terminating segments of leased lines in Italy except for connections where mobile network operators have replicated Telecom Italia's infrastructure or could easily do so. In a letter sent today, the Commission has endorsed AGCOM's proposals, asking it to remove regulation only after a transition period long enough for mobile operators to eliminate remaining bottlenecks in their networks. This is the 1000 th notification to which the European Commission has responded under the "Article 7" procedure of European Telecoms rules. Since 2003 this consultative process has guaranteed a competitive and consistently regulated single European telecoms markets for consumers and businesses.

"EU telecoms law, when properly put in place, leads to investment, increased infrastructure competition and elimination of monopolies, to the ultimate benefit of Europe's consumers ," said Viviane Reding, the EU's Telecoms Commissioner. "It is therefore good news for Europe's consumers, telecoms companies and for Europe's single market that the EU's telecoms reform strengthens and streamlines telecoms regulation across the 27 EU Member States. Comments from the Commission, serious doubts letters or veto decisions will become even more important on Europe's telecoms markets during the next five years."

" The EU scrutiny of 1000 notifications has proven to be an efficient and successful tool to ensure an in tensive co-operation between the Commission and the National Regulatory Authorities . It contributes to consistency in regulatory practice, while at the same time taking into account specific national market conditions. Regulation has been essential to ensure a level playing field for new market entrants, wherever former monopolies still dominate markets. Opening up markets through regulation during 6 years has already created the conditions for effective competition in many markets, making regulation unnecessary", said Neelie Kroes, EU Competition Commissioner.

The Italian telecoms regulator AGCOM notified the Commission on 29 October of its plans to partially deregulate the Italian terminating segment leased lines markets. Leased lines are connections which allow voice calls and data to be transmitted between two locations. They may be acquired by consumers or by providers which have access to an operator's network and in turn provide leased lines services to consumers.

AGCOM defined two markets for terminating segments of leased lines:

  • leased lines between Telecom Italia's connection point to which an alternative operator is interconnected, and the end-user’s connection point ;

  • leased lines leading to base stations of mobile network operators

AGCOM informed the Commission that it found Telecom Italia, the incumbent operator, to be dominant on the first market and proposed to impose a full set of remedies on it. For leased lines leading to mobile operators' base stations, ACGOM says that mobile operators are replicating the incumbent's fixed infrastructure and therefore proposes to lift regulation in this sector.

The Commission has today broadly approved AGCOM's plans, but with comments. Noting that the mobile network operators have not fully replicated Telecom Italia's networks in the second market, with a view to safeguarding competition and consumers interests, the Commission urges AGCOM to withdraw regulation in this field only after a transition period long enough to enable mobile operators to eliminate remaining bottlenecks in their networks.

Article 7 procedure comes of age

The European Commission has assessed a total of 1000 proposals from EU countries of measures to make their national telecoms markets more competitive. The European Commission plays a key role in these market reviews because it can ask for these plans proposed by national telecoms regulators to be amended or can even block these measures if they do not comply with EU law. Since the review process began at the end of 2003, in the majority of cases the Commission has asked the national regulatory authorities to amend certain elements of the proposed measures with a view to ensure consistent regulation across the EU. In a limited number of cases the Commission has vetoed these proposals which were incompatible with EU telecoms rules and asked the regulator to withdraw the notification.

Europe's telecoms rules aim to progressively reduce sector specific regulation as competition develops in the market. The roll-out of next generation access networks which brings high speed broadband services to consumers poses new challenges for regulators to prevent new market monopolies. The Commission will issue a Recommendation on the regulation of next generation access networks in spring 2010 to ensure a consistent approach for regulating these new services.

Background

The Commission's comments to AGCOM follow the " Article 7 procedure ", under the Framework Directive of the EU telecoms rules ( MEMO/08/620 ) .

The adopted EU Telecoms package ( MEMO/09/513 ) equips both the Commission and the regulators with the necessary tools to tackle outstanding regulatory challenges like differing remedial approaches by national regulators and persistent dominance of former public operators.

The Commission's letter sent today to the Italian regulator will be published at the end of this week at:

http://circa.europa.eu/Public/irc/infso/ecctf/library?l=/commissionsdecisions&vm=detailed&sb=Title

MEMO/09/539

Annex

Comparative overview of regulated markets in the EU



All national regulators (except for Bulgaria and Romania) have notified at least once all the markets which are recommended by the Commission for ex ante regulation. Many regulators are undertaking their second round market analysis and some authorities have already started their third round. The vast majority of regulatory proposals were endorsed by the Commission and all its decisions issued so far have been adopted with the main objective of providing guidance to NRAs in their market analysis, whilst addressing policy and implementation issues, in order to ensure a consistent yet appropriately nuanced approach in all Member States.

Figures and graphics available in PDF and WORD PROCESSED


Notifications received

Figures and graphics available in PDF and WORD PROCESSED


The new Single Market Procedure for assessing market definitions and
significant market power findings proposed by national telecoms regulators

(Article 7 of the Framework Directive 2009)



* BEREC - Body of European Regulators for Electronic Communications

The new Single Market Procedure for assessing regulatory remedies
proposed by national telecoms regulators

(Article 7a of the Framework Directive 2009)



* BEREC - Body of European Regulators for Electronic Communications


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