1. Liberalisation and regulation in the telecommunication sector: Theory and empirical evidence
Week 3
The European Regulatory Framework for the Telecommunication Sector: Main Issues and Current Trends

2. Overview of presentation
Regulatory aspects of EC policy. Main legislative measures in relation to:
Opening up of markets
Open Network Provision
Licensing
What next?
17/5/2001

3. Opening up of markets
Legislative measures are introduced after consultation with interested parties and the publication of Green Papers
Opening up of markets in
Terminal Equipment (Directive 88/301/EEC)
Services other than voice telephony (Directive 90/388/EEC)
Satellite services and equipment (94/46/EEC)
Cable TV networks carrying liberalised telecom services (other than voice telephony) (Directive 95/51/EEC). Led also to Dir. 99/64/EC addressing the problem of cross-ownership of telecom and Cable TV networks by an incumbent in the same market. Please comment...
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4. Opening up of markets (cont’d)
Mobile communications (Directive 96/2/EC). Required
early liberalisation in infrastructure building,
the right for interconnection, and
licenses for DCS 1800 issued from 1/1/1998.
Public Voice Telephony and Infrastructure (Directive 96/2/EC)
Telecom markets should fully open by 1/1/1998 (transition periods allocated to certain M-S)
Restriction on use of alternative infrastructure for services other than voice telephony lifted by 1/7/1996
Provisions for interconnection agreements and for safeguarding universal service
Special case: Voice over Internet (Notice of 1/1/1998)
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5. Open Network Provision (ONP)
ONP Framework Directive (90/387/EEC): stressed the need for harmonisation measures.
Revised ONP Directive (97/51/EC) called for structural separation between the regulator and the Tos
Specific ONP Directives on
Leased Lines (92/44/EEC) revised in 1997 (97/51/EC)
Voice Telephony (95/62/EC) revised by Dir 98/10/EC
Interconnection (Directive 97/33/EC)
Also Recommendations for ISDN and PSDS
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6. Application of ONP principles to Leased lines
Purpose:
To ensure a minimum set of analogue and digital leased lines up to 2 Mbps with harmonised technical characteristics
Also availability of info on technical characteristics, tariffs, supply, and usage conditions
establishment of common ordering and billing procedures
Cost orientation of tariffs
Dispute resolution procedures in place
Revised Directive called for a mandatory set of leased lines to be providedby Operators with Siginificant Market Power (SMP)
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7. Application of ONP principles to Voice Telephony
It addresses detailed service issues:
definition of targets for supply time and quality of service at national level
provision of advanced facilities
discounts, low-user schemes, and other tariff provisions
availability of itemised billing
directory services
public payphones
provisions for the disabled and people with special needs
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8. ONP principles to Voice Telephony (cont’d)
The revised Directive 98/10 further defines:
A common set of parametres and measurement methods for monitoring quality of service
Definition of affordability by M-S
Regular reports on tariff evolution throughout the Union
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9. Application of ONP principles to Interconnection
Interconnection Directive
It describes a framework for action not specific rules
Organisations specified in Annex I and have SMP should provide interconnection upon demand
Definition of the term ‘SMP’
Requirement to define which TO are responsible for Universal Service
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10. Interconnection Directive (cont’d)
Obligations of TO with SMP
Tariffs should be reasonable, non-discrimant, and transparent
Timely provision of information to new comers, so that they are in a position to negotiate
Timely information regarding changes in network architecture
Publicise interconnection agreements (except parts related to commercial policy practices)
Cost-based interconnection tariffs (not applicable to mobile operators)
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11. Interconnection Directive (cont’d)
Publication of a Reference Interconnection Offer (RIO)
Transparency in accounting systems
Accounting separation between activities and adoption of appropriate costing methodology, Recommendation of 8/4/1998 recommends disaggregation into the following business lines:
Non telecom-related activities
Telecom-related activities
Retail
Core network
Local access network
Value-added services
Other activities
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12. EC Recommendation C(97) 3148 - Part I
Proposes the use of Βest Current Practices
Ιn order to simplify comparisons, the approach taken in the Recommendation is to examine the interconnection charges to the incumbent's fixed public network under three different scenarios:
1.'Local' level interconnection
A call handed over for termination at the local level represents interconnection at (or nearest to) the local exchange to which the destination user is connected and represent the lowest level of interconnection charge which is available in a given country.
2."Single transit' interconnection, (metropolitan level)
Single transit interconnection allows access to all customers in a metropolitan region, such as a large city. This is likely to be the level of interconnection most often demanded by new entrants in a national market.
3.'Double transit' interconnection ( 'national' level)
Double transit interconnection allows access to all customers on the incumbent's network ('national' level' interconnection). A call handed over at this level normally incurs the highest level of interconnection charge.
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13. Licensing Directive 97/13/EC general and individual licences
prohibition of any limitation in the number of new entrants
harmonisation licensing procedures and requirements
Set up of one-stop-shopping procedures
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14. What next?
New Regulatory Framework for electronic communications infrastructure and associated services
Regulation of the European Parliament and of the Council on Unbundled Access to the Local Loop (final text, adopted by Council 5 December 2000, incorporating EP amendments)
Proposal for a Directive of the European Parliament and of the Council on common regulatory framework for electronic communications networks and services Com (2000)393
Proposal for a Directive of the European Parliament and of the Council on universal service and users' rights relating to electronic communications networks and services Com(2000)392
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15. Cont’d
Proposal for a Directive of the European Parliament and of the Council on access to, and interconnection of, electronic communications networks and associated facilities Com(2000)384
Proposal for a Directive of the European Parliament and of the Council concerning the processing of personal data and the protection of privacy in the electronic communications sector Com(2000)385
Proposal for a Directive of the European Parliament and of the Council on the authorisation of electronic communications networks and services Com(2000)386
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