Watchdog warns bid to veto telecom rules will stifle industry development

Date: 05/07/01

A EUROPEAN Commission bid to veto telecoms regulations is a recipe for red-tape which would stifle development in the sector, the head of a group of EU watchdogs claims. The Belgian presidency and MEPs are set to re-launch a debate on the framework directive linchpin of telecom chief Erkki Liikanen's package of reforms, which sets the tone for the future regulation of the sector.

He wants to force national regulatory authorities (NRAs) to notify the Commission of key decisions to check whether these would damage the single market by creating an 'un-level playing field' for telecoms firms selling services in more than one member state.

But Ireland's chief regulator, Etain Doyle, says this approach would tie up resources in the NRAs and the Commission "in reviewing hundreds, perhaps thousands of decisions every year". Doyle, who chairs the Independent

Regulators' Group, argues that "this level of bureaucracy is likely to stifle development" and would discourage regulators from finding better ways of policing their local markets - for fear that the Commission would block them.

She also says NRAs could become a piggy in the middle between national courts, companies and the Commission. Doyle's views - shared by member states - reveal a widening gulf on the issue between industry groups and the European Parliament.

This will result in lengthy conciliation talks to thrash out an accord on the directive later this year. John Dickie, head of regulatory affairs for the European Competitive Telecommunications Association, says a Commission veto is vital for achieving the EU's goal to be in the "vanguard of the e-economy".

Otherwise, he claims, operators would potentially face 15 different sets of rules and regulations, discouraging them from doing business across the Union. "This is a classic power struggle between institutions - it is as simplistic as that," Dickie said.

But he dismissed an alternative suggested by regulators and member states as equally, "if not more" bureaucratic. Under this scheme regulators would still notify the Commission of their plans, but the institution's opinion would not be binding.

There would be a formal role for a high-level group of regulators, which would coordinate policies to ensure there were few differences in approach from one country to another.

A debate on the issue was originally planned for last week's telecom ministers' meeting in Luxembourg. But the outgoing Swedish presidency concentrated on trying to reach common positions on other pieces in the telecoms jigsaw - rules on universal service and data protection. Ministers agreed that member states should be given the choice on how loss-making universal services - such as providing phone lines to rural areas - should be funded. But they were unable to agree on parts of the data directive covering the handling of 'spam' e-mails and the retention by operators of client information.

A European Commission bid to veto telecoms regulations is a recipe for red-tape which would stifle development in the sector, the head of a group of EU watchdogs claims.