Select Committee on European Scrutiny First Report


COM(01) 141

Commission Communication on the introduction of third-generation mobile communications in the European Union: state of play and the way forward.

Legal base:
Document originated: 20 March 2001
Forwarded to the Council: 22 March 2001
Deposited in Parliament: 12 April 2001
Department: Trade and Industry
Basis of consideration: EM of 20 June 2001
Previous Committee Report: None
To be discussed in Council: Transport and Telecommunications Council 4-5 April 2001
Committee's assessment: Politically important
Committee's decision: Not cleared; information on progress requested

The Commission Communication

16.1  The Commission briefly takes stock of the state of play in the assignment of third generation (3G) mobile communications licences in the EU, taking into account the regulatory environment, the financial context, outstanding technical issues, and the development of new markets as mobile communications increasingly allow data services. It says in its introduction that in this document it is not aiming to cover the full range of topics related to the introduction of advanced mobile data services in the EU, such as the social implications, the protection of users or the legal issues relating to content. It focusses instead on some regulatory and technical issues which it describes as critical to the success in the EU of 3G technology, the system which will allow the introduction of these new services. It notes that the majority of Member States have now granted 3G licenses.

The Commission's proposals for action

16.2  The Communication sets out three areas in which the Commission suggests that action should be taken at EU level to facilitate a successful rollout of 3G services in the EU.

Section (i): Getting the future regulatory framework right.

16.3  Referring back to the 1999 Communications Review package currently under negotiation, and in particular to the proposals for a Framework Directive[26] and for a Decision on a regulatory framework for radio spectrum policy in the European Community (the Spectrum Decision)[27], the Commission says that it is confident that these measures will help to reduce differences in licensing procedures and licensing conditions in the future, and thus avoid such fragmentation as is happening now.

Section (ii): Support from existing Community activities

16.4  The Commission proposes that the Community fully exploit the potential which already exists to support the evolution of future digital wireless services, for instance in the European Research Area and eEurope Action Plan programmes.

Section (iii): Dealing with emerging regulatory issues

16.5  The Commission seeks to launch a Community-wide discussion on a range of regulatory issues that have arisen, in different Member States at different times, in connection with the conditions of 3G licences already assigned, as a consequence of the increasingly heavy financial burden on the telecoms operators. It says that most of the issues are common to all Member States and that national authorities are faced with the same type of questions. It considers that there is a risk of "yet increased fragmentation of the regulatory environment". Key issues to be addressed relate to the possibility of changing licence conditions, for instance on rollout obligations and duration, and whether or not network infrastructure sharing might be permissible. The Commission takes a positive attitude in principle to infrastructure sharing because of its potential economic gains, but on condition that Community law and the competition rules are respected.

The Government's view

16.6  In an Explanatory Memorandum dated 20 June, the Minister for eCommerce and Competitiveness (Mr Douglas Alexander) comments:

    "Specific proposals by the Commission on the assignment modalities for licences are being considered separately in the context of negotiations on the new regulatory framework for electronic communications networks and services. There, the UK has expressed strong objections to the Commission's proposals for harmonising assignment methods in the Framework Directive and in the Spectrum Decision on legal, economic and political grounds. (In the latest text of the Spectrum Decision this proposal has been dropped.) In its political agreement on a common position on the proposed Framework Directive, reached at the 4-5 April Transport and Telecommunications Council, the Council rejected the Commission's proposal that it be able to overrule such decisions by national regulatory authorities that it considered incompatible with Community law.

    "The Government supports the proposals to exploit fully the 6th Framework Programme and the eEurope Action Plan to facilitate the timely roll out of 3G networks and services, particularly programmes such as: EContent for multilingual and customised European content; Go Digital for supporting SMEs with advice and best practice; [and the] Skills Task Force.

    "On the key regulatory issues raised in Section (iii):

    "—  changes to licence conditions. The UK Government sees no merit in changing 3G licence conditions e.g. deployment obligations, licence duration.

    "—  network infrastructure sharing. Oftel posted on its website on 1 May a statement, agreed jointly with DTI and the Radiocommunications Agency, on the scope for infrastructure sharing agreements in the UK. The licences issued under the Telecommunications and Wireless Telegraphy Acts do not a priori exclude infrastructure sharing. Some forms of infrastructure sharing are positively encouraged (mast sharing). However, any individual proposal for infrastructure sharing would need to be assessed on the detail of the commercial arrangement and its consequences for consumers, which would be subject to general competition law."


16.7  The Minister says that his Department and OFTEL have been liaising closely with industry over the rollout of 3G services in the UK.


16.8  The 1999 Communications Review and the proposals, both regulatory and non-regulatory, which have since been submitted to us for scrutiny form a body of work of considerable importance to the UK telecoms industry, and to the economy as a whole. The areas covered are specialised, but the Government has sought to keep us fully informed of the issues and its concerns as the relevant documents have been submitted, or by letter to inform us of progress.

16.9  European Standing Committee C debated the implementation of the telecommunications regulatory package and radio spectrum policy in February 2000,[28] but we believe it would be helpful to us if, in the autumn, the Minister were to give us a general account of the work in hand under the eEurope Action Plan, of progress on the various proposals arising from the 1999 Communications Review, on a number of which the Council has now reached political agreement on a Common Position, and on the Government's view of what further action it would be appropriate to take at EU level, taking into account the suggestions for further action made by the Commission in the document we consider here.

16.10  Meanwhile, we shall not clear this document.

26  The draft Directive for a common regulatory framework for electronic communications networks and service; see (21562) 10962/00: HC 28-x (2000-01), paragraph 10 (28 March 2001). Back

27  (21585) 11117/00; see paragraph 15 of this Report. Back

28  Official Report, European Standing Committee B, 16 February 2000. Back

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