Opinion on the proposal for a European Parliament and Council Directive on the Application of Open Network Provision (ONP) to Voice Telephony () (95/C 236/10)

On 18 April 1995 the Council decided to consult the Economic and Social Committee, under Article 100 A of the Treaty establishing the European Community, on the abovementioned proposal.

The Section for Transport and Communications, which was responsible for the Committee's work on the subject, adopted its Opinion on 10 May 1995. The Rapporteur was Mr Green.

At its 326th Plenary Session (meeting of 31 May 1995), the Economic and Social Committee adopted the following Opinion unanimously.

1. The proposal from the Commission

1.1. This proposal is basically a resubmission of a proposal put forward in 1992 (COM(92) 247 final) which was turned down by the European Parliament in July 1994, primarily on comitology grounds. The ESC unanimously adopted its statement on that proposal on 25 November 1992 (CES 1342/92).

1.2. In the meantime, the EP has called for the resubmission of the proposal, and the EP, the Commission, and the Council have agreed a modus vivendi on comitology. The Commission therefore now hopes that the resubmitted proposal may be adopted without delay.

The said modus vivendi is intended to deal with an issue which has been left open in the Treaty of the European Union. The new co-decision procedure has not been reflected in Article 145 dealing with the delegation of implementation issues to the Commission. The Treaty therefore in principle lacks a procedure for the delegation in the context of co-decision.

1.3. The Council has agreed a timetable for the liberalization of all telecommunication networks, infrastructures and services, with 1 January 1998 as the primary target date. This development will change the current basis of exclusive or special rights as the criterion for application of ONP to telecommunication organizations (the 'scope' of ONP).

The proposed Directive itself is independent of any particular degree of liberalization and leaves to the individual Member State to notify to the Commission those telecommunications organizations to which the Directive shall apply. This is in line with the subsidiarity principle; however, depending on the precision of the definition of the scope of ONP, this may lead to some variation in the application of ONP in each Member State.

The precise implementation of the liberalization still needs to be resolved with appropriate legislation. It must be expected that all exclusive or special rights will be withdrawn. According to the Green Paper on the liberalization of Infrastructure (part II), issued by the Commission, it must be expected that any regulatory limitations on the number of actors in telecommunications may be based only on any limitations in 'natural resources', such as radio frequencies, numbering, or town planning limitations. It is important to note, however, that the legislation is still in the pipeline, and that this regulation thus is in a transitional phase.

1.4. The resubmitted proposal has been changed on a number of points without changing the main substance of the Directive. The changes are mainly directed towards improved consumer protection emphasizing the monitoring role of the National Regulatory Authorities.

2. General comments

2.1. Despite the development towards competition, there is still a need for a Directive on ONP for voice telephony, and the ESC refers to its first statements on the expected benefits in consumer protection, universal service and a harmonized single market for telecommunications services related to voice telephony.

2.2. With the abolition of special and exclusive rights for voice telephony and the related networks, it becomes even more important that a minimum set of pan-European service aspects are defined and are supported by important service providers. Therefore the ESC recalls its former Opinion as follows: 'The definition, implementation and interpretation of the ONP measures should be related to the costs involved. ONP measures must take account of the real nature of demand, bearing in mind economic and social viability, technical feasibility and initial and operating costs. Any moving towards basing tariffs on costs should be gradual and should be linked to measures to ensure that low-traffic users, and consumers in general, enjoy tariff reductions - as business subscribers do - and measures to encourage the connecting to the network of households which could not otherwise be connected.'

The proposed Directive defines such a minimum set of pan-European service aspects, and leaves it to each Member State to identify those telecommunications organizations responsible for supporting it (depending on the state of service supply and competition in that Member State). While market mechanisms in time should replace regulatory mechanisms, it must be expected that the telecommunications market for some time will call for some degree of regulation, in particular concerning bottlenecks, and depending on the market situation in each country.

2.3. The introduction of competition also increases the importance of setting basic principles for fair competition, not least in the realm of network interconnection. The Commission has indicated that a proposal for a Directive on Interconnection will be forthcoming in the context of ONP. The ESC accepts the articles in the current proposal on special network access and interconnection as initial measures and looks forward to a future, more comprehensive set of proposals in a separate proposed Directive. In the meantime, Member States should ensure adequate and fair interconnection for all competitive providers.

2.4. The ESC welcomes the modification of Article 10(1) to reflect the rights for users to be heard before a particular decision by the NRA. This modification was suggested in item 3.2 of the prior ESC statement.

2.5. The ESC supports the wish that the proposed Directive shall be adopted without delay.

3. Specific comments

3.1. The ESC emphasizes the need to provide the advanced facilities listed in Annex III(1), as referred to in Article 9, but also expects the services and facilities detailed in Annex III(2) to be introduced on a Community-wide scale as soon as possible, subject to technical feasibility and economic viability. This would seem necessary if the universal service is to be achieved. For this reason, the procedure for Community-wide convergence referred to in Article 25 is particularly important.

3.2. The ESC wishes to emphasize the importance of the application of the principles of cost orientation and cost allocation, Articles 12 and 13, and that these principles shall make proper allowance for a capability to invest in the introduction of new technologies.

3.3. The ESC notes that preamble No 44 emphasizes the importance of the technical adjustment of the Directive, and the importance of the views of the Member States. The ESC also notes the importance of the proposals of the Member States. Due to the potentially wide ranging consequences of the adjustments, the ESC should be consulted on such proposals.

3.4. The ESC believes that the Commission should report to the EP, the Council and the ESC no later than 2 years after the deadline for implementation (ref. Articles 31 and 32).

Done at Brussels, 31 May 1995.

The President

of the Economic and Social Committee

Carlos FERRER

() OJ No C 122, 18. 5.1995, p. 4.