Daems launches bid to thrash out telecoms deal

Date: 31/10/01

By Peter Chapman

Belgian telecoms minister Rik Daems is ready to water down member states' demands for freedom from Commission 'interference' in the EU's multi-billion-euro telecoms markets.

Daems hopes his compromise will win the support of MEPs and stave off the risk of a lengthy conciliation process. But industry figures says the move would still leave the telecoms market totally fragmented with a swathe of contradictory rules from one country to another - putting the brakes on cross-border investment.

Daems' offer concerns 'article 6' of the 'framework directive' - the linchpin of Telecoms Commissioner Erkki Liikanen's new laws to regulate the sector in the 21st century. Earlier this year, telecoms ministers sparked fury both within industry and the Parliament by throwing out Liikanen's demands for the Commission to be given a veto on decisions by national telecoms regulators that would in its view hamper the single market.

The stance - seen by many as a blatant attempt to keep power in capitals and away from Brussels - almost guaranteed that the directive would plunge into a lengthy conciliation procedure with MEPs.

European Voice has learned that Daems - seen as Belgium's 'Mr Fix-it' after he brokered a common position on the politically charged postal liberalisation dossier - is now ready to offer the Commission a limited veto in certain areas.

These concern the application of competition rules in the sector, for example the criteria for selecting which firms might warrant extra regulation because they enjoy 'significant market power' in their markets. However, the Commission would not be allowed to block decisions in these areas if they are taken in cooperation with other regulators.

Michael Bartholomew, director of telecoms lobby ETNO, said: "The powers given to the Commission in this compromise document don't go far enough. We don't want to get drawn into a long inter-institutional battle on this. But it seems to us the only way forward is to make sure with iron-clad guarantees that there are some real powers given to the Commission so that we don't find ourselves with a hotch potch of different opinions rendered by NRAs [national regulatory authorities]. "It should seem obvious to everyone that in this economic climate it is impossible for our companies to commit themselves to make major investments in the EU unless they have legal certainty."

Even with this compromise, "they simply won't have that", he insisted. "If France Telecom goes into another market it won't know if it will be playing by the same ground rules [as at home]," he said, pointing out that many ETNO members, though dominant players at home, are new entrants in other EU markets and reliant on regulators to ensure they get a fair deal.

He said it was better for Liikanen's whole telecoms package to be put on ice until next year if operators' demands cannot be met. This includes other laws on 'access and interconnection' and universal service. Finnish MEP Reino Passalinna said Daems' efforts marked a "positive step", although he insisted Parliament still wanted the Commission to have a veto on all decisions taken by NRAs.

He said deputies had been totally opposed to the common position agreed earlier this year by telecoms ministers. "Are they really willing to destroy the single market...when it is directly against the eEurope strategy agreed by heads of state and the Lisbon summit?" he asked.

Paasilinna said MEPs in the assembly's industry committee would debate their position on the issue 6 November.

Belgian telecoms minister Rik Daems is ready to water down Member States' demands for freedom from Commission 'interference' in the EU's multi-billion-euro telecoms market.