The European Commission has published, for the eighth consecutive year, the annual report on the implementation of the telecommunications regulatory package.
After analysis of the situation in the fifteen Member States telecommunications sectors, the Commission sets as main priority a timely transition from the current to the new regulatory framework, to be made on the 24 July 2003, underlying the role that the national regulatory authorities (NRA) and the competition authorities will have to play. It is the Commission's understanding that this new framework, apart from providing legal predictability and regulatory flexibility necessary for continued investment in the sector, will complement the eEurope objective of achieving competitive local access to Internet services over broadband networks as cheaply as possible in a sustainable basis.
The implementation report is prepared with data related to September 2002 after several meetings and public hearings with the NRAs, the telecommunications services providers and operators and the consumers defence associations.
Key conclusions on market development
Despite the difficult financial situation, the growth of the telecommunications market varied, in 2002, from 5 to 7 percent, which represents a slight reduction as compared to 2001, where the growth rate was of 9.5 percent.
In the fixed telephony market, where carrier pre-selection has proved a highly successful means of opening competition, although there was a slight reduction in the number of new entrants, the number of providers with direct access grew about 42 percent. Prices to consumer maintained the downward trend that happened over the last years: since 1998, national calls decreased in average 50 percent, while international calls registered a fall of about 40 percent, the tariffs practised by the new entrants being of about 56 percent (in national calls) and 65 percent (in international calls) below the ones of the incumbents.
In the mobile telephony market, the value of the average monthly consumer invoice also fell to about 23 percent.
Despite the current difficulties, the penetration rate in the digital television segment rose slightly to 21 percent.
Key regulatory conclusions
There are positive indicators of the NRA capacity to implement the new regulatory framework and also as far as the licensing and fixed market rates regimes are concerned.
However, there is still a shortage in the unbundled local loop offer (ULL), with impact in the DSL market, where there are still difficulties in pricing and access. According to the report, the regulators need to carry forward the efforts made on the application of the cost-orientation and non-discrimination principles to those areas. In this market, the incumbent operators market share is very high (89 percent of the local network market is held by the incumbents) and penetration of new operators is insufficient.
In the leased lines market, there are problems associated with the application of the cost-orientation principle and, as far as the cost accounting obligations are concerned associated with the enforcement of the tariffs principle, there is still considerable work to be done with regard to the verification and certification of the operators' accounts by the NRA. Difficulties in obtaining rights of way and building permits for infrastructure roll-out is a continuing concern, in particular as regards third generation mobile services.
Finally, universal service is guaranteed without major problems in the fifteen Member Countries, which should however pay more attention to citizens with special needs.
The sector in Portugal
The report focuses on the greater autonomy that the Autoridade Nacional de Comunicações (ANACOM) acquired with the enforcement of its new statutes. It also refers to the change that this authority underwent regarding the relationship between the Executive and the incumbent operator, Portugal Telecom (PT), whose chairman is no longer appointed by the Government, being elected by shareholders. Although the golden share of the State in PT - equivalent to 6.6 percent - is not considered in breach of Community law, its revision in the near future is suggested.
Despite the insufficiencies in the ULL - notwithstanding the eight decisions that ANACOM has adopted as far as this matter is concerned since June 2001 -, the document refers to the criticisms put forward by the new operators regarding the lack of intervention of the Direcção Geral do Comércio e da Concorrência, the national competition authority, which they think is due to its insufficient human resources.
In the analysis of the national situation of the sector, it is worthy of standing out: the interconnection prices, which fell 15.5 percent, but are still above the community average; the sale of the fixed telecommunication network, meanwhile alienated to PT, by decision of the Council of Ministers of 11 December; the narrowband internet traffic, whose prices did not decrease and did not grow, despite the introduction of flat rates in 2001; the issue of the ULL, a matter in which it is urgent to improve the positioning of Portugal, namely through the increase of investment from the new operators and reduction of PT reference offer prices; selection, pre-selection and portability (in the two last matters, the current scenario is seen as satisfactory); the granted licenses, being of interest to underline the current difficulties with the introduction of the land digital television; the rights of way (the Commission investigates the legality of the exemptions granted to the incumbent in this field); financing of the universal service, being underlined ANACOM's draft decision, of September 2002, which considers that PT is not entitled to compensations before 2000, the liberalization starting date; finally the new regulatory package, whose transposition requires the adoption of a new basic law and several decree-laws, which have been delivered to the Government, the draft basic law being subject to the approval of the Assembly of the Republic.
Further information:
- 8th Report on the Implementation of the Telecommunications Regulatory Package http://europa.eu.int/information_society/topics/telecoms/implementation/annual_report/8threport/index_en.htm
- Situação em Portugal http://europa.eu.int/information_society/topics/telecoms/implementation/annual_report/8threport/finalreport/portugalfinal.pdf
Related information on ANACOM's website:
- Seventh Report on the Implementation of the Telecommunications Regulatory Package https://www.anacom.pt/render.jsp?contentId=18447
