12 Regulation of electronic communications
and services~
| (34917)
9291/13
SWD(13) 152
| Commission Staff Working Document: Evaluation Report of the Body of European Regulators for Electronic Communications (BEREC) and its office
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| Legal base | —
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| Document originated | 23 April 2013
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| Deposited in Parliament | 16 May 2013
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| Department | Culture, Media and Sport
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| Basis of consideration | EM of 24 May 2013
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| Previous Committee Report | None
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| Discussion in Council | To be determined
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| Committee's assessment | Politically important
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| Committee's decision | Cleared
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Background
12.1 The EU regulatory framework for telecommunications was created
in the 1990s to open national telecommunications markets to competition.
Until then, they had been dominated by state-owned monopolies.
12.2 In 2002, the Council adopted five Directives
to establish a common set of EU rules for the national regulatory
authorities (NRAs) to implement. The objectives of this legislative
framework were to promote competition, consolidate the EU's internal
market and promote the interests of consumers. The Directives
are:
- Directive 2002/21/EC on a common
regulatory framework for electronic communications networks and
services (the Framework Directive);
- Directive 2002/20/EC on the authorisation of
electronic communications networks and services (the Authorisation
Directive);
- Directive 2002/19/EC on access to, and interconnection
of, electronic communications networks and associated facilities
(the Access Directive);
- Directive 2002/22/EC on universal service and
users' rights relating to electronic communications networks and
services (the Universal Service Directive); and
- Directive 2002/58/EC on the processing of personal
data and the protection of privacy in the electronic communications
sector (the Privacy Directive).
12.3 In 2006 and 2007, a substantial reform was proposed
because of:
- new electronic communications
technologies;
- the development of the market for electronic
communications networks and services;
- the continued dominance of a few operators in
some key markets; and
- divergent approaches by Member States to regulation.
12.4 The Commission proposed amending legislation
to simplify the regulatory processes; change the regulation of
the radio spectrum; require Member States to ensure the independence
of NRAs; establish a new European Electronic Communications Market
Authority (EECMA) to help overcome what it saw as inconsistencies
in the decisions of the NRAs; improve consumers' rights; and strengthen
the security of networks and the privacy of personal information.
12.5 After prolonged negotiation, the revised EU
regulatory framework now consists of:
— a
Framework Directive setting out the main principles, objectives
and procedures for an EU regulatory policy regarding the provision
of electronic communications services and networks;
— an Access and Interconnection Directive
stipulating procedures and principles for imposing pro-competitive
obligations regarding access to and interconnection of networks
of operators with significant market power;
— an Authorisation Directive introducing
a system of general authorisation, instead of individual or class
licences, to facilitate entry in the market and reduce administrative
burdens on operators;[52]
— a Universal Service Directive
requiring a minimum level of availability and affordability of
basic electronic communications services and guaranteeing a set
of basic rights for users and consumers of electronic communications
services; and
— a Privacy and Electronic Communications
Directive setting out rules for the protection of privacy
and of personal data processed in relation to communications over
public communication networks.[53]
12.6 In proposing the EECMA, the Commission envisaged
that it would replace the independent European Regulators Group
(ERG, which brings together the National Regulatory Agencies,
or NRAs, of each Member State) and ENISA (the European Network
and Information Security Agency). The previous Government had
misgivings from the outset: essentially, that it was not at all
clear how the EECMA would operate; that it would be seeking to
involve itself unnecessarily and unhelpfully in areas that were
the preserve of national authorities, particularly spectrum management;
and that the Commission would be much better employed in ensuring
that the established system — based on strong and independent
NRAs which are encouraged by their respective governments to get
on with the job of promoting competition, new services and a better
deal for consumers, in which the UK led the pack — was implemented
effectively in those Member States who were either dragging their
feet or being obstructive.
12.7 This view prevailed. As a result, the Body
of European Regulators for Electronic Communications (BEREC) was
established by Regulation (EC) No. 1211/2009 of 25 November 2009,[54]
as part of the revised Telecom Reform package.[55]
It accordingly replaced the ERG.
12.8 BEREC commenced its activities in January 2010.
According to its website, BEREC is:
"Committed to independent, consistent,
high-quality regulation of electronic communications markets for
the benefit of Europe and its citizens."
12.9 With this in mind, BEREC says that it contributes
to the development and better functioning of the internal market
for electronic communications networks and services by aiming
to ensure a consistent application of the EU regulatory framework
and to promote an effective internal market in telecoms sector,
in order to bring even greater benefits to consumers and businesses
alike.
12.10 BEREC also assists the Commission and the national
regulatory authorities (NRAs) in implementing the EU regulatory
framework for electronic communications, to give advice on request
and on its own initiative to the European institutions and to
complement at European level the regulatory tasks performed at
national level by the regulatory authorities.
12.11 NRAs and the Commission "have to take
utmost account" of any opinion, recommendation, guidelines,
advice or regulatory best practice adopted by BEREC.
12.12 In particular BEREC is requested to:
- develop and disseminate among
NRAs regulatory best practices, such as common approaches, methodologies
or guidelines on the implementation of the EU regulatory framework;
- on request, provide assistance to NRAs on regulatory
issues;
- deliver opinions on the draft decisions, recommendations
and guidelines of the Commission as specified in the regulatory
framework;
- issue reports and provide advice, upon a reasoned
request of the Commission or on its own initiative, and deliver
opinions to the European Parliament and the Council, when needed,
on any matter within its competence;
- on request, assist the European Parliament, the
Council, the Commission and the NRAs in relations, discussions
and exchanges of views with third parties; and
- assist the Commission and NRAs in the dissemination
of regulatory best practices to third parties.[56]
12.13 BEREC is supported by a small European agency
called the BEREC Office, situated in Riga.
The Commission Staff Working Document
12.14 An evaluation within three years of the effective
start of operations of BEREC and its Office is a requirement under
Article 25 of the BEREC regulation. This document is that evaluation.
12.15 The evaluation was conducted by Price Waterhouse
Coopers (PWC), working with a Steering Committee which included
representatives from the Commission, BEREC, and the relevant operator
and consumer associations.
12.16 PWC's key findings in relation to BEREC are:
— overall,
the structure of BEREC is relevant and efficient. It has so far
fulfilled its functions successfully, but there may be elements
for improvement;
— BEREC can play a significant role in
harmonising the electronic communications market, through the
development and dissemination among NRAs of regulatory best practices
on the implementation of the regulatory framework, through its
advisory role and through reports and common positions which should
serve as guidelines for NRAs towards a harmonised approach;
— however, getting agreed positions within
BEREC will require a significant cultural change among NRAs:
"being a bottom-up regulatory model, [BEREC] exemplifies
in some cases more national considerations than a pure EU single-market
driven approach";[57]
— the independence of BEREC vis-à-vis
the individual NRAs could be improved, in the sense of developing
collective European thinking different from the national interests
of the NRAs that form it. BEREC, as a single entity, should be
more focused on missions that concern the Single Market: harmonisation
of the internal market and empowerment of EU consumers. Furthermore,
BEREC has to be independent from any government or stakeholder.
In order to achieve this, "it is of utmost importance that,
at the national level, each NRA composing BEREC carries out its
functions independently";[58]
— BEREC should be more accountable for
the tasks its chooses to tackle by itself by including its commitments
in its Annual Work Programmes and Mid-Term strategy, and reporting
on progress in its Annual Report;
— the scope of regular reviews of BEREC's
work could be enhanced, in order to achieve greater prioritisation;
and
— the decision making process should provide
more room for the Board of Regulators to take strategic decisions.
12.17 Regarding the BEREC Office, the evaluation
finds that the role and responsibilities of the Office in relation
to administrative versus professional support need to be clarified,
and that the professional expertise of the Office staff is not
used as much as it could or should be, for example in the drafting
and delivery of contributions by BEREC's Expert Working Groups.
The Government's view
12.18 In his Explanatory Memorandum of 24 May 2013,
the Parliamentary Under-Secretary of State for Culture, Communications
and Creative Industries at the Department for Culture, Media and
Sport (Mr Edward Vaizey), recalls the scepticism of the previous
Government as to whether the proposed governance and structure
of EECMA had enough independence to ensure robust, evidence-based
decisions, and its preference for an enhanced ERG, with a formalised
role in the legal framework, which eventually became BEREC —
now formally recognised, and with powers and responsibilities,
under European law. In particular, the Minister notes the requirement
that the European Commission should take "utmost account"
of BEREC's advice in adopting harmonising instruments, and that
NRAs are required to take "utmost account" of BEREC's
common positions (best practice recommendations).
12.19 The Minister notes the UK's independent regulator,
Ofcom "is heavily involved in the operation of BEREC",
and that the European Parliament's Committee on Industry, Research
and Energy has announced its own review of BEREC which is expected
to report towards the end of the year.
12.20 He continues his comments as follows:
"BEREC's written input to the Evaluation
Report welcomed the positive picture described by PWC but highlighted
areas where they did not agree with PWC's conclusions, in particular
PWC's suggestion that BEREC should impose more of top-down European
approach to achieve harmonisation and the development of the internal
market. Instead BEREC argued that these objectives directly concern
the NRAs that form BEREC, that they are a key component of BEREC's
work, and that BEREC remains the best way of achieving these objectives,
ensuring that regulatory decisions have legitimacy within national
markets.
"Separately, we understand that the Commission
wishes to take steps to complete the electronic communications
single market, although it is not clear what this means in practice
and no specific details have been provided by the Commission as
yet. There is a theoretical risk that the Commission may seek
to reintroduce a body akin to EECMA as one way of achieving this
outcome. However, Member States' responses to the previous proposals
and the positive evaluation of BEREC at this early stage of its
development, supported by the outcomes of a separate review of
EU Decentralised Agencies which described BEREC as 'ensuring a
consistent application of the EU regulatory framework in this
area' suggest that this risk is low at the current time. The areas
that members of the Commission have publicly suggested that it
might cover do not include the replacement of BEREC with a body
akin to EECMA."
12.21 In sum, the Minister says that "BEREC
is playing an effective role in shaping the EU regulatory framework
for communications."
Conclusion
12.22 Although the report raises no questions,
we are drawing it to the attention of the House because of the
background to the establishment of BEREC. The model whereby NRAs
have been at the heart of regulating operation of electronic communications
and services — and not top-down regulation by the Commission
or an executive agency deriving from and responsible to it —
has been crucial to its success. It is thus important that it
has been essentially validated by this independent evaluation.
Equally important is the Minister's judgement that the Commission
will not return to the charge — especially as in other areas
(e.g., the roll-out of high-speed broadband) the Commission has
been showing unwelcome and unwarranted centralising tendencies.
Both he, no doubt, and we will make sure that there is no back-sliding
as and when the Commission puts forward any further steps to complete
the electronic communications single market.
12.23 In the meantime, we now clear this document.
52 http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2009:337:0037:0069:EN:PDF Back
53
http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2009:337:0011:0036:EN:PDF Back
54
http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2009:337:0001:0010:EN:PDF. Back
55
http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2009:337:FULL:EN:PDF. Back
56
http://berec.europa.eu/ Back
57
Ibid. Back
58
Ibid. Back
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