Opinion of the Economic and Social Committee on the "Proposal for a Decision of the European Parliament and of the Council on a regulatory framework for radio spectrum policy in the European Community"

(2001/C 123/14)

On 4 October 2000 the Council decided to consult the Economic and Social Committee, under Article 95 of the Treaty establishing the European Community, on the above-mentioned proposal.

The Section for Transport, Energy, Infrastructure and the Information Society, which was responsible for preparing the Committee's work on the subject, adopted its opinion on 9 January 2001. The rapporteur was Mr Hernández Bataller.

At its 378th plenary session of 24 and 25 January 2001 (meeting of 24 January 2001), the Economic and Social Committee adopted the following opinion by 80 votes to one with one abstention.

1. Introduction

1.1. The Community institutions have concerned themselves with this question for a number of reasons, including the intensive use of radio spectrum, the complex decision-making process for its allocation and assignment, huge global expansion generated by the technological convergence of various services, and economic trends, as well as the need to apply internal market principles and protect Community interests at world level.

1.2. The Green Paper on Radio Spectrum Policy in the context of European Community policies such as telecommunications, broadcasting, transport, and R& D(1) addressed five key issues:

- strategic planning of the use of radio spectrum;

- harmonisation of radio spectrum allocation;

- radio spectrum assignment and licensing;

- radio equipment and standards; and

- the institutional framework for radio spectrum coordination.

1.3. The Green Paper was welcomed by the Economic and Social Committee, which considered radio spectrum to be the backbone for a very wide range of important industrial sectors, and argued that in addition to technical grounds, future decisions needed to reflect the economic, social and political importance of spectrum usage.

1.3.1. The ESC was of the opinion that the EU needed to play an enhanced and better co-ordinated role in spectrum policy.

1.4. The Commission accordingly drew up a Communication on Next Steps in Radio Spectrum Policy: Results of the Public Consultation on the Green Paper, which was discussed at the meeting of the Telecommunications Council of 30 November 1999(2). The three following initiatives were proposed at the meeting:

- to set up a spectrum policy expert group to address radio spectrum policy issues at Community level;

- to establish a regulatory framework for radio spectrum policy which would replace sector-based decisions such as those concerning Satellite Personal Communications Services (S-PCS) and Universal Mobile Telecommunications Systems (UMTS); and

- to produce a communication on the Community's policy objectives in relation to the agenda of the World Radiocommunications Conference (WRC).

2. The Commission proposal

2.1. The proposal is intended to ensure the harmonised availability and efficient use of radio spectrum, where required to implement Community policies in areas such as communications, transport, broadcasting and research and development (R& D).

2.2. The proposal aims to establish a framework that will ensure a proper balance between radio spectrum needs in order to implement Community policies, while taking due account of current institutional arrangements for radio spectrum management, and safeguarding Community interests at international level.

2.3. As a result of the public consultation exercise, the Commission considers that where harmonisation is required, legal certainty and appropriate procedures must also be safeguarded by granting mandates to the CEPT to develop spectrum harmonisation measures at European level and the corresponding proposals for the ITU/WRC. Legal certainty is also required to ensure implementation by Member States of agreed harmonisation measures.

2.4. To date, radio spectrum requirements have not been dealt with in Community legislation in Community policy areas other than telecommunications (such as terrestrial and satellite TV and radio broadcasting; road, rail, air and maritime transport; positioning, navigation and precision timing; Earth observation; and radio astronomy). The present proposal seeks to establish the political and legal basis necessary to ensure that radio spectrum is and will be available to implement Community policies in all these areas.

2.5. The main objectives of the proposal are to:

- set up a policy platform, to be called the Senior Official Radio Spectrum Policy Group, which is responsive to technological and regulatory developments in the radiocommunications field and which allows for proper consultation of all relevant radio spectrum user communities. The platform will advise the Commission on how best to distribute radio spectrum within and across different user communities and countries;

- establish a legal framework for spectrum harmonisation where necessary;

- ensure coordinated and timely provision of information on radio spectrum use and availability in the EC;

- ensure that appropriate Community and European positions are developed with a view to international negotiations relating to spectrum, where the issues at stake are covered by Community policies.

3. General comments

3.1. The Committee welcomes the proposal for a regulatory framework ensuring the harmonised availability and efficient use of radio spectrum, where required to implement Community policies in areas such as electronic communications, transport, broadcasting and Research and Development (R& D). This will guarantee the rational, equitable, effective and economic use of frequencies for all radiocommunication services, recognising:

- the importance of strategic planning in the use of radio spectrum;

- the need for assignment to be harmonised;

- the unsuitability of price mechanisms as an instrument for allocation of public interest services.

3.1.1. The ESC would, however, repeat its agreement with the objective of striking the requisite balance between the technical assessment procedure and other political, economic and social procedures which might be used for this highly scarce resource.

3.2. The ESC notes that one objective not touched upon by the proposal is for the planned actions to guarantee the public interest, wherever it clashes with the private interest of groups or companies which wish to make use of a scarce resource, as spectrum is, for their own purposes (for example, with measures which may jeopardise territorial cohesion). The proposal's aim of achieving efficient management on the basis of technological neutrality is inadequate.

3.3. Community radio spectrum policy must ensure that competition and efficiency among service providers on the single market are not distorted. The ESC is concerned at the emergence of monopolistic or oligopolistic situations within the Community in areas of spectrum use. In the medium term, this might apply to UMTS licences, insofar as those bidding for contracts may establish links or associations, or undertake mergers with or buy-outs of their competitors. A balance must be sought between medium- and long-term interests, and in spectrum allocation and assignment, and appropriate measures must be taken to uphold viable competition.

4. Specific comments

4.1. The ESC suggests that in order to improve spectrum use, consideration be given to harmonising usage fees and rights at Community level, believing that this is preferable to payment by bidding for licences: harmonisation would boost free competition and economies of scale. The funds generated should be used to improve spectrum management.

4.2. The planned procedural framework should safeguard economic, social and territorial cohesion. Certain licence tendering procedures must not be allowed to result in certain disadvantaged areas funding infrastructure in others, through the fees charged to service users with the aim of offsetting the costs of tendering for spectrum use. In the final analysis, the procedural framework must serve to head off distortions of competition or cross-subsidies.

4.3. With regard to the value of radio spectrum, the ESC would warn of the possible negative impact on employment and increased costs for consumers which may result from putting defined, regulated licences for spectrum use out to tender and sale, since higher spectrum costs would be passed on to the price of the service and more intensive use of capital.

4.4. The ESC believes that the highest possible level of protection for users and public health must be ensured, and is convinced that further research into the health aspects of electromagnetic fields is necessary.

4.4.1. The proposed rules for the Senior Official Radio Spectrum Policy Group and the Radio Spectrum Committee fail to make sufficient provision for official involvement of civil society organisations.

4.4.2. The Economic and Social Committee therefore proposes that a European Radio Spectrum Forum be set up, with its headquarters at the ESC, to bring together concerned parties such as industry, trade unions, users, universities, local authorities and civil society organisations in general. Forum members could issue mandatory reports and formulate demands on a transparent basis, so that their interests are known to the Radio Spectrum Group and Committee.

4.4.3. The Forum would ensure that all those concerned by a given radio spectrum issue could explain their position, thereby contributing to the best possible resolution of existing problems.

4.5. Information provided by the Member States should be published as widely as possible and in a standardised format, to allow comparison of spectrum use in each location.

4.6. All the Member States must have centralised, public information systems holding all frequency use data which have not been classified at secret. With this sole exception, the Member States should satisfy all requests for information on any frequency assignment.

4.7. Publishing of frequency information is important, and should be supported. Real benefits can only be secured from publication if the information contains all the data necessary for it to be used effectively.

4.8. In addition to the types of information set out in the Annex, the information provided by the Member States should be supplemented in the light of the needs identified by the proposed Forum. Initially, this might include the following:

- use of assigned bands: number of users, degree of saturation, etc.;

- the economic and tax-related conditions, and those governing duration and extension of licences, with identification of licence-holders. This would provide information on the concentration of spectrum use and any ensuing regional and social imbalances in sufficient time for remedial action to be taken;

- assignment and spectrum use conflicts within each Member State together with appropriate measures to resolve such conflict and prospects for successful resolution;

- open conflicts with other Member States or non-EU countries on radio spectrum use.

4.9. Radio spectrum is a natural resource which must not be individually managed by the Member States: rather, it demands coordinated action at Community level paving the way for effective spectrum management at national level.

4.9.1. The ESC believes that the mechanism contained in the draft decision for working with non-EU countries and international organisations will help strengthen the single market and competitiveness and boost Europe's position on the world market and the EU's position in world forums.

4.9.2. The ESC agrees with the Commission that the necessary measures must be taken to achieve a common position and to ensure Community coordination.

4.9.3. The Community and the Member States must maintain the most open stance possible in the international arena (ITU, WRC and CEPT), without prejudice to application of the principle of reciprocity.

5. Conclusions

5.1. The ESC is convinced that a permanent, stable and uniform framework needs to be established at Community level, ensuring harmonised availability of radio spectrum and introducing legal certainty.

5.2. In applying these policies, interactive connections providing services to disadvantaged or thinly populated areas and giving access to information and e-commerce services throughout the Community could be expanded. This would contribute to regional cohesion and the growth of the information society.

5.3. The final aim of any radio spectrum policy must be to provide the public with high-quality services and guarantee their social relevance. For this reason, the ESC opposes a purely commercial approach to this policy: the economic and social value of spectrum frequency use cannot be evaluated only in terms of operators' profit opportunities - it is very largely determined by the importance of the services offered by operators, the number of users and, ultimately, by the enhanced quality of life it brings to citizens.

5.4. Frequency allocation cannot be separated from the application or specific service the bandwidth is to be used for. In this context, it would be helpful for Member States to harmonise their stance on the principles of radio spectrum pricing, frequency tendering and the introduction of a secondary market for radio spectrum. Where possible, profits should be ploughed back into research and the use of new information and communication technologies, thereby furthering the development of the information society, rather than being treated as tax revenue.

Brussels, 24 January 2001.

The President

of the Economic and Social Committee

Göke Frerichs

(1) COM(1998) 596 final; ESC opinion in OJ C 169, 16.6.1999.

(2) See COM(1999) 538 final, http://www.ispo.cec.be/spectrumgp/