Regulators should apply the new guidance in their daily decision-making as soon as the text is published in the EU's Official Journal. Under the telecoms Framework Directive (2002/21/EC) they are obliged to take utmost account of the EC's Recommendation, justifying any departure from it. The Recommendation provides regulatory clarity to telecom operators, ensuring an appropriate balance between the need to encourage investment and the need to safeguard competition. It will help to stimulate investment in competitive high-speed broadband networks, which is a key objective of the Commission's Digital Agenda for Europe and the Europe 2020 strategy.
Both well-established existing and newer telecoms operators are currently upgrading their existing copper networks to fibre by investing in 'fibre to the node' (FTTN) or 'fibre to the home' (FTTH) networks.
The NGA Recommendation gives national regulators the tools to support new entrants to the NGA market, and to support infrastructure-based investment from established market players. At the same time, the Recommendation aims to facilitate market entry and competition by alternative operators, allowing them to climb the 'ladder of investment' and gradually to deploy their own network infrastructure. More specifically, the NGA Recommendation reinforces a number of principles to be followed by the EU's regulators:
- Firstly, while there will be no 'regulatory holidays' for dominant firms, price regulation for access to fibre networks will fully reflect investment risk, and will enable investing companies to make attractive profits. Given the potential size of investments under consideration and the currently low returns in many financial asset classes, this is a propitious framework for companies willing to invest.
- Secondly, national regulators must have at their disposal a full range of access remedies from which, in the light of national market circumstances, they select the appropriate combination to drive market entry and infrastructure-based competition.
- Thirdly, ex ante regulation in a fibre setting should reflect differences in the conditions of competition between individual markets and areas (rural and urban) within a given market, resulting in light-touch regulation where competitive forces are strong (cable operators and future mobile internet).
- Finally, the Recommendation strongly supports arrangements for co-investment in NGA networks and allows setting lower access prices to the unbundled fibre loop in return for up-front commitments on long-term or volume contracts.
The deployment of fibre-based NGAs in the EU is still at a relatively early stage. However, an increasing number of national regulators have begun to consider questions of regulated access to NGAs as part of their regular market reviews. The Commission is being notified of a growing number of regulatory measures as part of the 'Article 7 consultation procedure' (Art. 7 of Directive 2002/21/EC). Based on the scrutiny of these measures, the Commission judged that unless it provided guidance to telecoms regulators, there was a clear danger of divergences between Member States' telecoms markets. Such a situation could lead to market distortions as a result of inconsistent regulation and lead to uncertainty for companies investing in next generation access networks.
The EC Recommendation will bring greater consistency and clarity to telecoms regulators' decisions, so as to encourage timely and efficient investment in NGAs throughout the EU Single Market, while fostering competition in the market for broadband services.
Further information:
- Original press release - Europa Press Releases Rapid
- European Commission Recommendation of 20/09/2010 on regulated access to Next Generation Access Networks (NGA)
- Directive 2002/21/EC of the European Parliament and of the Council of 7 March 2002 on a common regulatory framework for electronic communications networks and services (Framework Directive)
- ePractice Related Publication - EU: A Digital Agenda for Europe - Commission Communication
- Europe 2020 - 'A strategy for smart, sustainable and inclusive growth'
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Quelle/Source: epractice, 23.09.2010
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