The Communication is divided into three main parts, although we will focus on the second one:

• Market developments;
  
• Regulatory environment;
  
• Consumer interest;

The Communication points out the telecoms sector as the biggest single component of the Information and Telecommunication Technology (ICT) sector. Despite a slower growth in 2007, it continues to be key in the European economy.

It emphasizes that the institutional framework is being revised by the European Commission (EC) due to concerns regarding lack of effective National Regulatory Authorities (NRAs) enforcement powers, particularly as regards financial penalties and the ability of the NRAs to intervene in access and interconnection issues. It also emphasizes that, NRAs, in small Member States (MS) in particular, find it difficult to muster the expertise and resources needed to conduct market reviews and monitor implementation of remedies in increasingly complex markets.  Among its proposals for revision of the framework, the EC has included provisions to strengthen the independence of the NRAs. This is seen also as a prerequisite for regulatory certainty. The EC is planning to introduce mechanisms to reduce systematic appeals against NRA decisions as means of delaying the implementation of regulatory decisions.

Other areas where a lack of consistency is more evident is in cost-orientation and cost-accounting methodologies. This can act as an extra burden on operators seeking to offer pan-European services.  The report states that lack of NRA enforcement powers or unwillingness to exercise them can be a reason why remedies are still not implemented in practice.

As for spectrum management, the report says that 2007 saw further progress towards a single market for wireless communications. The trend towards greater use of market-based approaches to spectrum management has also continued, and the proposed changes to the regulatory framework are expected to consolidate this trend.

Some MS tend to make spectrum authorisations technology and service neutral, in line with the proposals made by the EC. So far, the EC harmonisation decisions taken in accordance with the Radio Spectrum Decision 676/2002/EC during the period 2004 to 2007 have been implemented in most MS, but still an effort is needed to complete the process.  A further difficulty is that the EU spectrum harmonisation legislation is duplicated in non-binding intergovernmental agreements in the CEPT (European Conference of Postal and Telecommunications Administrations).

During 2007 the EC applied its Decision 2007/98/EC harmonising the use of spectrum for the implementation of systems providing Mobile Satellite Services (MSS), but still more harmonised procedures are needed in order to ensure that spectrum required for the provision of pan-European services can be licensed. The Communication recalls that, in order to achieve these goals, the EC has therefore proposed the European Electronic Communications Market Authority to facilitate the process.

To sum up, the EU regulatory model has shown itself capable of ensuring increasingly competitive markets; however, the regulatory environment is frequently based on inconsistent approaches which greatly hinder the realisation of a real single market across the Union and the economic benefits flowing from it.

Next steps:
Adoption of the review of the EU regulatory framework for electronic communication networks and services by April 2009

To read the Communication, please click here
To read the related staff working document, please click on volume 1 and volume 2