COMMISSION OF THE EUROPEAN COVMUNITIES 
C0M(93) 159 final 
Brussels, 28 Apr I I 1993 
^f?* 
COMMUNICATION TO THE COUNCIL AND EUROPEAN PARUAMENT 
ON THE CONSULTATION 
ON THE REVIEW OF THE SITUATION 
IN THE TELECOMMUNICATIONS SERVICES SECTOR 
TABLE OF CONTENTS 
I iftfroduction 1 
ft Tt» consultation process 3 
M Commonts roçoiVDd concerning the roaki issues 4 
A. Curretil State of iinpten>ei dation of G&mniunky Telecommunications Legation S 
B. Growth and Efficiency 7 
C Universai Service 9 
D. Tariffs 10 
E Regional and Soda) Cohesion 11 
F. The international Dimension 12 
G. Liberalisation and Harmonisation 13 
IV The positions taken on the options proposed 14 
V Evaluation by tlio Commission 17 
A. Areas of General Consensus 17 
B. General Positions on Future GoveJopment 16 
C. Identification of Action required for Future Regulatory Environment 19 
4* 
VI Key factors for tfie development of the future regulatory environment 21 
A. Consolidation of the Current Regulatory Environment 21 
B. Common Definition of Universal Service Principles 21 
C. Development of a Framework for Interconnection Agreements 23 
D. Definition of Principles for Access Charges 24 
E. Independence of Telecommunications Organisations 25 
F. Ensuring Social and Regional Cohesion 26 
G. Preparing the Environment for Trans-European Networks 27 
H. Working out a Balanced Approach to Infrastructure Provision 27 
I. Ensuring a Balanced International Environment 28 
J. Developing the Balance between National and Community Regulation 29 
VII The proposed schedule 33 
A. Major Steps 34 
First phase (1993 -1995) 
Second phase (1996 -1998) 
B. Timetable for Action 35 
VIII Conclusions 38 
Annex I Draft Résolut km of the Council 
Annex II: List of Contributors to the 1992 Telecommunications Services Review 
At, 
INTRODUCTION 
With the adoption of its Communication. "1992 Review of the situation in the telecommunications 
services sector , on 21 October 1992, the Commission launched a wide-ranging debate about 
the development of telecommunications in the European Community up to the end of the decade. 
Operating under the requirement set out in both tlie Telecommunications Services Directive and 
the Open Network Provision (ONP) Framework Directive , the Commission has carried out an 
overall assessment of tlie situation in the telecommunications sector in relation to the aims of the 
two directives. In particular, the Commission was required to consider whether the 
circumstances leading it to aHow a temporary exception of basic voice telephony services and 
infrastructure from tfie Community competition rules had changed. 
The Commission, in its Communication of October 1992, focused the debate around four possible 
options: 
Option 1: Freezing of tlie liberalisation process and maintenance in effect of the status quo 
Option 2: Introducing extensive regulation of both tariffs and investments 
Option 3: Liberalisation of all voice telephony 
Option 4: An intermediate option of opening up to competition voice telephony between Member 
States 
The options are sot out in dotail in the Communication of October 1992 to which reference should 
be mado. Further information on the development of the sector is provided in the studies which 
have been mado available by the Commission in the context of the Review. Detailed information 
on tariffs was given in the Tariff Communication of July 1992. The Commission's support 
strategy for the telecommunications sector, via research and development programmes, was 
c 
given in its Communication on the equipment industry . 
On 19 November 1992. the Telecommunications Council supported this consultation process and 
established an Ad Hoc High Level Committee of National Regulatory Authorities to work with the 
Commission within the context of the consultation. 
1 Communication by the Commission of 21 October 1992 on (he 1992 Review of the situation in the 
telecommunications sector (SIX'(92) 1048). 
2 Commission Directive of 28 June 1990 on competition in the markets for telecommunications services 
(9()/.Wyiii;c, <>J 1. 192/10.24.07.90). 
' Council I )ircclive of 28 June 1990 on the establishment of the internal market for telecommunications services 
ihmiil'li the implementation ol Open Network Provision (90/187/1 vliC, OJ L 192/1, 24.07.90). 
4 ( ommission ( 'omiminication of IS July 1992 Towards cost orientation and the adjustment of pricing structures -
telecommunications tariffs in the Community" (SHC(92)1050 final). 
s Commission Communication of IS July 1992 on "the European telecommunications equipment industry - the 
state of play, issues at stake and proposals for action" (SliC(92)I049 final). 
Jf> 
Ihe TelecoiiHiuitHcatHMi:; Cotntcfl on the same date also welcomed the Commission's intention to 
report back to the next Telecommunications Council, scheduled for 10 May 1993. This is the 
objective of the present Communication. 
Il THE CONSULTATION PROCESS 
Mie aim of the consultation was to obtain the views of bot ft European industry as a whole and of 
the main players in the telecommunications sector on the issues identified in the Communication 
of October 1992. In particular, views were welcomed on the four options outlined in the 
Communication and. more generally, on the future direction of telecommunications policy in the 
EC. 
Whilst the Commission, in its Communication, expressed an initial preference for Option 4, this 
did not prejudge the outcome of the consultation. Indeed, the oral and written comments 
received by tfie Commission liave helped it to refine and re-focus on the areas in which further 
action is most appropriate and urgent. 
Tfie public consultation was largely completed by the end of January. The Commission has 
received more than 80 written comments from companies and individuals, and European industry 
associations. These included contributions from a large number of user associations 
(representing large, medium and small users) and large commercial users in the manufacturing 
and services sectors; from the European Telecommunications Network Operators association 
and the majority of Community-based Telecommunications Organisations (TOs) individually; from 
existing or potential new service providers; and from manufacturing associations, individual 
equipment manufacturers and the Joint Telecommunications Committee representing 
telecommunications organisations and trade unions. Other comments were received from 
organisations and companies based in other European countries including countries of the future 
European Economic Area, and in North America. 
In addition to the written comments, the consultation involved a series of hearings with different 
interest groups, individual users of telecommunications services and user associations; the 
chairmen of the Community's TOs; service providers and potential new entrants; equipment 
manufacturers and trade unions. More than 130 organisations participated in total. 
Tfie Commission also worked closely in carrying out the consultations with the Ad Hoc High 
Level Committee of National Regulators set up by the Telecommunications CounciLof November 
1992. A meeting with the High Level Committee on 7 January 1993 preceded the series of 
hearings and defined their structure. 
The second meeting of the High Level Committee took place on 11 and 12 February at which the 
Commission reported on the comments received during the consultation and received the 
substantive comments of the High Level Committee on the issues raised by the Review. A further 
meeting with representatives from the High Level Committee was held on 25 February specifically 
to discuss regional and social cohesion issues. 
A final meeting on 20 March allowed the High Level Committee to give its views on the results of 
the consultation and the Commission's responses to them, as outlined in this Communication. 
A list of participants at the hearings and of the written contributors is set out in Annex 2. 
Ihe Joint IHeciimmimicalioiis Committee, which brings together trade unions and management 
ol Ihe Community l'Os, gave its opinion on 21 January 1993. 
On 20th April 1993 tlio European Parliament, adopted a Resolution supporting the Review 
process*. 
Ill COMMENTS RECEIVED CONCERNING THE MAIN ISSUES 
At its first meeting the High Level Committee of National Regulators and the Commission agreed 
to focus the consultation on certain key issues: 
- the current state of implementation of Community telecommunications legislation; 
- the effects of tfie further evolution of telecommunications policy on growth and efficiency in the 
Community; 
- universal service; 
- tariffs; 
- the need to ensure regional and social cohesion within the Community; 
- the international dimension; and 
- the appropriate balance between liberalisation and harmonisation. 
The hearings were organised according to this structure and the written comments were analysed 
in the light of these issues. 
The main views on each of tho topics are summarised below. The full text pf the written 
comments will be made available on request. 
Resolution of the lui rope, in Parliament on Ihe < 'oin mission ( 'ommumValion of 21st October 1992 concerning Ihc 
1992 Review of the situation in Ihe telecommunications services sector (SHC(92)I048 final), 20.4.1993. 
On the same dale the lùiropcan Parliament adopted a Resolution on Ihe Communication from the Commission 
Towards cost orientation and Ihe adjustment of pricing structures - Telecommunications tariffs in the 
Community1' (SI:C(92)I0S0 final). 
A. Current State of Implementation of Community Telecommunications Legislation 
(1) The consultation:; piovidcd evidence both from those in the telecommunications sector 
and from (ftiropean indttslty as a whole on the practical impact of implementation of key 
Community telecommunications legislation and on the urgency ol pending proposals. 
10 7 ft 
As regards existing Directives - in particular the Services Directive , the ONP measures , 
Q 
the implementation of the Terminal Equipment Directives - the application of existing 
Community legislation, especially the Services Directive, was widely held to be incomplete. 
(2) Users and service providers emphasised in particular the difficulties encountered in a 
number of Member States in operating private networks for the provision of voice services 
to closed user groups. 
The lack of high capacity leased lines at reasonable prices gave particular concern to 
users and service providers and there was a general feeling that supply was not 
adequately adjusted to demand. Although the real demand for such services beyond 
particular vertical industry groups was questioned by some TOs, users and service 
providers generally suggested that lack of demand relates directly to both excessive prices 
and tfie relatively small number of private networks present in the Community, itself a 
consequence of the current regulatory environment . 
7 Commission Directive of 28 June 1990 on competition in the markets for telecommunications services 
(90/388/EEC, (ML 192/10, 24.07.90). 
K Council Directive of 28 June 1990 on Ihe establishment of the internal market for telecommunications services 
through the implementation of open network provision (90/387/EEC). 
Council Directive of 5 June 1992 on Ihe application of open network provision to leased lines (92/44/EEC). 
Council Recommendation of S June 1992 on the harmonised provision of a minimum set of packet switched data 
services (PSDS) in accordance with open network provision (ONI') principles (92/382/EEC). 
Council Recommendation of .S June 1992 on the provision of harmonised integrated services digital network 
(ISDN) access arrangements and a minimum set of ISDN offerings in accordance with open network provision 
(ONP) principles (92/383/1-EC). 
9 Commission Directive of 16 May 1988 on competition in the markets for telecommunications terminal 
equipment (88/301/I-EC) 
( 'oiincil I )irective ol 29 April 1991 on the approximation of the laws of the Member Stales concerning 
telecommunications terminal equipment, including the mutual recognition of their conformity (91/263/EEC). 
.In this context, reference was made to the situation in the USA, where leased line capacity was more generally 
available and where there were 700,000 private networks on a total line base of 132 million. In the EC, with a 
subscriber line base of 146 million, there were only 14,000 private networks. 
(;i) As regards pending proposals, many contributors stressed the need for the rapid adoption 
ol existing pioposals currently in progress in Council and the European Parliament, such 
as the proposed directives on ONP and voice telephony and on the mutual recognition 
of telecommunications services licences , as well as the satellite proposals currently in 
n 
discussion 
There were also calls for the extension of ONP to guarantee high capacity (ie Gigabit) 
leased lines in the near future and to tackle interconnection and unbundling of service 
offerings. 
(4) National regulators, it was felt, were not yet truly independent of the operators in a number 
of Member States and the style of regulation between Member States was diverse. It was 
felt that this discourages service providers from offering one-stop shopping and pan-
European network management services. Overall, it has a negative impact on business 
planning on a pan-European basis. 
(5) The lack of transparent licensing procedures was also of particular concern to users in a 
number of Member States, where there were no published criteria for the granting of 
licences and no set timescale for applications to be granted or rejected. 
(6) In summary, it was generally agreed that the Community should actively seek the full 
practical application of existing measures by Member States, as a high priority objective in 
the short term. 
Furthermore, clarification was demanded of the precise scope of some of the measures; in 
particular, the position of closed user groups and the ability to transmit private voice under 
the terms of the Services Directive. 
Finally, the Community should seek to achieve the rapid adoption of current proposals. 
" Proposal for a Council Directive on ihe application of open network provision (ONP) to voice telephony, 
COM(92)247. 
'*' Proposal for a Council Directive on ihe mutual recognition of licences and other national authorizations to 
operate telecommunications services, including the establishment of a Single Community Telecommunications 
Licence and the setting up of a ( 'omnumity Telecommunications Committee, COM(92)254. 
1 ' Proposal for a Council Directive on the approximation of the laws of the Member States concerning satellite 
earth station equipment, extending the scope of Council Directive 91/263/EEC, COM(92)451. Additional 
initiatives are currently being finalised by the Commission covering competition in the market for satellite 
communications services and terminals, and on the mutual recognition of national authorisations for satellite 
networks and satellite services. 
B. Growth and Efficiency 
(/) Discussion centred on the eflecls of liberalisation on growth and efficiency of both the 
operators and of users and industry as a whole. In particular, comments were invited on 
the effects that the four options might have on the prices charged by operators and on 
service innovation, revenue and investment. Consideration was also given to the effects of 
a resulting increase in usage; of existing telecommunications networks and services on the 
operators' revenues, efficiency and costs. 
(8) There was general agreement amongst users, service providers and those operators with 
experience of liberalised markets that groater liberalisation would: 
- lead to substantial growth in tfie telecommunications sector and all sectors of the 
economy; and 
- attract investment to the Community to meet demands for new infrastructure and, in 
particular, for the creation of trans-European networks (TENs). 
(9) It was recognised that direct comparison between the Community and markets elsewhere 
such as In tfie US and Japan to determine the level of growth that could result from further 
liberalisation is difficult. However, many user associations and individual users, including 
those with experience of both markets, felt the current lack of liberalisation in Europe 
resulted in higher charges, poorer quality of service and less innovative service 
development. According to these organisations, this places the major European service 
and manufacturing industries at a serious commercial disadvantage compared to their 
competitors in North America and Japan, at a time when world markets require maximum 
focus on increasing the Community's global competitiveness . 
(10) Operators submitted that now pan-European services were being developed on a 
substantial scale as a result of cooperation between them . 
However, commentators with experience of more liberalised markets believed that the full 
diversity of innovative services and, in particular, their rapid translation into applications 
can only be achieved through more liberalisation. 
As a number of user associations and service providers pointed out, experience in more 
competitive markets shows that an incumbent TO can achieve successful growth in profits 
and maintain a strong investment programme in a more liberalised environment. 
The seriousness of the luiiden was illustrated by a major European car manufacturer who estimated that it would 
save 4^ per cent of its telecommunications budget were it operating in the United Stales. 
.Examples cited were inter alia the cooperation on (JSM, ISDN, and broadband networks, such as GEN, 
Mi: IK AN and others. 
(11) Ihe willitujness <>l the piivale sector to invest in infrastructure projects with long payback 
period:, was (itiestioned hy some, while the potential of such investment was emphasised 
by others However, the; traditional role of TOs in leading investment, it was suggested, 
has to be maintained. Particular attention was drawn to the situation of smaller operators 
because ol their relatively large proportion of income derived from international services. 
The ongoing investment capability of tfie TOs was of general concern, as expressed in 
particular by a number of manufacturing associations and the trade unions. The 
importance to the télécoms manufacturing industry of a strong European-wide home 
market on which to launch a wider expansion into third country markets underpinned 
concern over the operators' future ability to invest in their home market. On the other 
hand, manufacturers emphasised that growth and innovation in the Community would be 
harmed unless further liberalisation was introduced. 
(12) The trade unions emphasised the need to take into account the development of 
employment in the sector and proper training. 
(13) Freedom for TOs from non-telecommunications related obligations, such as contributions 
to the State budget, and the removal of restrictions on seeking outside funding were 
strongly supported by a number of operators and other commentators. 
An association representing tfie cable-TV industry stressed the immediate contribution that 
cablo networks could make to mooting users' needs, for services already liberalised, if 
access were allowed to the industry's existing, underutilised high capacity bandwidth. 
(14) In summary, there was general agreement amongst users, service providers and 
manufacturers that the bottlenecks identified in the Review - higji cross-border tariffs, 
unavailability of suitable leased lines and lack of advanced services - had a major 
negative impact on business. 
The continuing financial stability of TOs and the development of employmeQt were clearly 
recognised as crucial factors. Howover. it was pointed out by users, service providers and 
telecommunications operators in lil>eralised markets that investment programmes and 
profits can be maintained by incumbent TOs and new employment opportunities arise in a 
more liberalised environment. 
Progress to more of>en markets should take full account of the varying conditions in each 
Member State and. in particular, the specific needs of the peripheral and smaller countries. 
C. Universal Service 
(l.f>) Certain services, in particular the public (voice) telephony service, are made universally 
available; to the public because of their broader social benefits. This obligation traditionally 
falls upon the; TOs and is often supported by contributions from other service activities. 
Debate focused on the existing and future scope of universal service in Member States, 
how best to maintain the social aims of universal service in a competitive market and 
whether tin; burden of universal service should be shared more widely by all market 
participants. 
( 1 (J) Different interpretations were given during the consultation on the exact nature of universal 
service. Generally, the concept was recognised as one that will continue to evolve over 
time. Most commentators accepted that elements of that definition would include a basic 
voice service, universal coverage and an affordable price. 
Opportunities for providing universal service in a more effective and efficient manner were 
raised, with many organisations highlighting the need for support to poorer groups, either 
by direct subsidy or by means of special tariffing schemes offered by the operator. 
Certain operators took the view that since universal service was the responsibility of one 
undertaking, that operator should maintain special and exclusive rights in order to finance 
such obligations. There was fairly general acceptance amongst all participants that, to the 
extent that markets were liberalised, new entrants should bear a proportionate part of the 
burden of universal service, in particular, via the establishment of appropriate access 
charges. 
Another group of contributors, whilst accepting the principle of access charges, 
emphasised the need to protect new entrants from such charges until competition was 
properly established. There were calls for further detailed consideration of suitable access 
charge regimes to be given. 
(17) In summary, there was general agreement on the need for a clear definition of universal 
service. There was general acceptance that ONP directives have an effective role to play 
in defining the scope of universal service obligations in a Community context. The 
evolution of this role could ensure that the necessary harmonised concept of universal 
provision was introduced in the Community. 
Access charges wen; seen as a key means of sharing, where appropriate, the burden of 
universal service among all market participants. 
10 
D. Tariffs 
(18) In identifying bottlenecks to the development of telecommunications in the Community, the 
Review Communication stated: "... tariffs in general have not been adjusted sufficiently to 
costs. In particular, the tariffs for intra-Community communications remain high.' The 
consultation focused on the existing tariff situation in the Member States, the need for both 
cost-oriented and efficient tariff structures and the degree to which tariff rebalancing was 
already taking place and would continue to do so in the future. Consideration was also 
given to the inter relationship between international, national and local charges within the 
Member States. 
(19) Almost without exception, users and service providers commented on the high level of 
charges in tfie Community, as compared with the price of similar services in North 
America Tfie price of high capacity leased lines was of particular concern to several 
users with sites in a number of Community countries. High tariffs discouraged the use of 
such services and delayed the introduction of innovative new applications by such 
organisations. This constituted a major barrier to corporate communications, putting such 
European organisations at a competitive disadvantage. 
However, it was stressed by TOs and trade unions that tariff rebalancing placed particular 
strains on certain TOs, particularly those operating in the Community's peripheral regions 
and those with smaller networks. This resulted from the political sensitivity of raising local 
tariffs and the need to sustain current and future investment programmes. The TOs stated 
that progress towards cost-orientation was a key condition for further liberalisation and 
that sufficient transition time was needed for re-balancing of international, national and 
local charges. 
(20) Anotfior concern expressed by the TOs was the need for them to be allowed to offer 
flexible tariff schemes to respond to new competition. At the same time, TOs emphasised 
the need to be freed from non-telecommunications obligations imposed upon them in a 
number of cases. 
(21) The setting up of procedures at a Community level for reviewing tariff rebalancing, cost-
orientation and unbundling of service offerings, including charges, was suggested by 
several organisations as a vital component in introducing fair and effective competition. 
Users stressed the need for tariff elements to be unbundled and shown separately in 
accounts, and for the terms and conditions offered to users and service providers to be 
subject to at least as much scrutiny as tariffs. 
As regards the relationship between international, national and local charges, the majority 
of TOs stressed the close interaction beween these components of the tariff structure and 
tlie impact on cross subsidisation between the different components of major changes in 
any of them. These comments emphasised that adjustment of intra-Community tariffs 
should tfierefore be strongly correlated to the adjustment of the overall tariff structure. 
One commentator provided figures thai demonstrated that tariffs for some facilities in the Community were 
frequently ten times their equivalent in the I IS. 
11 
In summary, there was general support that the Community's efforts to encourage cost-
orientation, and therefore tariff rebalancing, were necessary and should continue. 
Users and service providers emphasised the detrimental effects caused by high tariffs in 
tfie Community. European industry was placed at a competitive disadvantage and the 
creation of Europe wide corporate networks was uneconomic. 
Sufficient transition times for tariff adjustment were seen as key to further tariff 
adjustments, compatible with national, regional and social goals. 
However, many contributors, including some TOs, also argued that tariff rebalancing and 
the introduction of further liberalisation could proceed in parallel and reinforce each other. 
Particular initial difficulties during tariff rebalancing on operators could be managed by 
appropriate access charge regimes. 
E. Regional and Social Cohesion 
(23) The effects of further liberalisation on the position of the peripheral regions and those 
countries with smaller networks in the Community are a central general concern. 
Discussion focussed on the special situation and needs of such countries and regions, the 
effects of further liberalisation on the TOs established in them, and the continuity of 
investment in such countries. 
Key characteristics of the situation faced by operators in the Community's peripheral 
rogions include: 
- a level of network development and penetration substantially below the Community 
average; 
- the fact that these countries are engaged in considerable investment in order to catch 
up with the Community's core regions and that this investment needs to be sustained 
for at least five years or more in a number of cases; 
- the investments undertaken, combined with low local tariffs, have resulted in operators 
facing high levels of indebtedness; 
- a high proportion of intra-Community (and international) traffic in the total revenues and 
traffic of tlie operators of such countries in several instances. 
(24) Many contributors emphasised that investment in telecommunications infrastructure and 
services in such regions was of central importance to the economic development of such 
regions. 
12 
A number of users, service providers and TOs believed that further liberalisation would 
have a positive eflect of attracting business and investment to such regions, and therefore 
increase overall employment. Tfie contrary view was that investment could be de­
stabilised by greater competition and the tariff rebalancing it would bring about, unless 
carefully planned and paced over time and unless appropriate support measures were put 
in place. 
(25) There was general support for tlie development of trans-European networks (TENs) which 
were seen as the electronic highways of the future, bringing the core regions of the 
Community and the peripheral regions closer together. TENs had the potential to play a 
major role in promoting greater cohesion within the Community. Community funding 
would be a vital component in tfie realisation of such networks and in particular should 
play a role in developing demand for the services to be offered over them. 
(26) In summary, it was considered of particular importance to adapt any proposals for the 
future development of the sector to the specific needs of peripheral regions and those 
countries with smaller networks. 
Major means envisaged were adequate transition periods and sufficient time to adjust, as 
well as full use of Community and national support structures. 
F. The International Dimension 
(27) The discussion focussod on the conditions for the provision of telecommunications 
services in the Community and third country markets and the practical problems 
encountered by Community businesses trying to enter third country markets. The 
consideration of these issues was set against the background of the current GATT Uruguay 
Round. 
Concern was expressed generally about the ability of foreign companies to provide 
telecommmunications equipment and services within the European Community, whilst 
their home markets remained effectively closed to Community businesses. In particular, 
problems were encountered by Community industry in relation to procurement policies 
and restrictions on foreign ownership found in other major markets. 
Finally, a number of users, service providers and some TOs emphasised the importance of 
external negotiations such as the GATT. Tlie need to coordinate internal policy within 
Member States and the Community's position in external negotiations was emphasised; it 
was argutKf that a clear timetable lor internal liberalisation would strengthen the 
Community's position in external negotiations. 
13 
(2tl) In summ.ity. il was generally accepted that tfie spctxl with which the Community market 
was opened to foreign competition should be conditioned by Community business 
obtaining equivalent access to loreign markets, with a differentiated approach to be 
applied to European Economic Area countries. 
It was also agreed ttiat the early definition of a clear schedule would reinforce the 
international post ion of the Community in particular in the context of the GATT 
negotiations. 
G. Liberalisation and Harmonisation 
(29) Consideration was given to the future balance between liberalisation and harmonisation, 
including the; continuing role for standardisation; the shape of future regulatory control of 
telecommunications in the Community and the role of subsidiarity in the emerging 
Community environment. 
In particular, universal service and interconnection were seen as vital elements in the 
Community's future regulatory environment. Whilst interconnection agreements should 
generally be determined at a national level, it was appropriate for the Community to 
establish a framework for interconnection. Users and service providers emphasised the 
need for a regulatory role at the Community level where the rules of competition might be 
applied. Furthermore, they stressed that the public availability of interconnection terms 
was an essential element in their business planning. 
There was widespread support for a pivotal role of ONP within the framework of a more 
competitive market. 
In this context, a number of contributors suggested that market dominance rather than 
special and exclusive rights should be the criteria for the application of ONP rules, in order 
to adjust to a more competitive environment. Some thought that small players in the 
market should be subject to a less stringent regime than that applying to existing large 
dominant operators. 
The need for independent regulation was stressed, and several comments suggested that 
there would need to be adequate arrangements at the Community level to deal with 
disputes having a cross-border dimension and to ensure a consistent approach to 
regulatory control throughout the Community. 
(30) In summary, it was suggested that the Community should see to the establishment of 
principles and a timetable for liberalisation and harmonisation and ensure its 
implementation, based on general Community procedures and the application of 
Community competition rules, whilst the National Regulatory Authorities should have the 
main responsibility for regulation and implementation at the national level. 
14 
iv nu POSH IONS IAKI NON mi oi'iiONSi'itoposro 
(31) The main focus of ihe comments concentrated on the four basic options for future policy 
proposed in the Communication of October 1992. Discussion focussed in particular on the 
timetable for future; change;, the phases in which that timetable should be implemented and the 
measures that might be; needed to take account of the specific situations in certain Member 
States 
(32) Option 1 (status quo) and Option 2 (extensive regulation) 
There was little support for Options 1 and 2 as permanent long-term options. However, the 
priority of full application of current Community legislation in the short term was widely 
emphasised. 
Sololy maintaining the status quo (Option 1) in the longer term was seen as doing little to 
resolve the bottlenecks identified in the Communication of October 1992. It would not 
encourage enough investment in either telecommunications or industry in the Community. 
It would place business in the Community at an increasing disadvantage with regard to Its 
competitors in North America and the Far East. 
Option 2 was generally viewed as leading to an excessive degree of regulation, which 
would conflict with the principle of subsidiarity. Some views were, however, expressed 
that the Idea of creating a European regulatory body centralising certain functions of 
formulating regulatory principles, monitoring of tariffs and the establishment of tariff 
principles, monitoring of the telecommunications standard policy, etc, should be explored. 
(33) Options 3 (full liberalisation of public voice telephony) and Option 4 (liberalisation of 
public voice telephony between Member States only) 
A recurring view from participants across the spectrum of contributors was that further 
liberalisation of the sector was both inevitable and desirable. 
Overall support focussed on Option 3, with Option 4 being seen by users, service 
providers and a number of TOs as an intermediate step on the road to full liberalisation, 
while tfie majority of TOs insisted on a close link between Option 4 and Option 3. 
There was little support for Option 4 as an isolated option and an end in itself. This option 
was not seen as fundamentally remedying the tariff and leased line bottlenecks identified 
by the Commission. However, as an intermediate step it was seen by a number of 
contributors as a means to attract considerable investment into the Community and 
promote tfie development of trans-European services, whilst others and in particular, a 
majority of TOs emphasised the close relationship between Option 4 and the adjustment 
process, particularly, for tariffs, required to prepare for Option 3. 
15 
Option 3 in the1 longer term was alse) favtiumd by the majority of TOs (while some 
advocated ils imple;mt;ntatit>n in the; shorten te;rm). with all TOs accepting its ultimate 
inevitability Ihete was general agree;me;nt on the need to put in place a suitable regulatory 
framework for me>ve;s tt)warefs full liberalisation, and to find in particular adequate solutions 
te> Ihe; issue;s e>f universal se;rvice, tariff rebalancing, access charges, interconnection and 
Ihe; d(;vcle>pme;nt e>f ne;twe>rk inve;stme;nt in the peripheral regions of the Community. 
(34) Infrastructure 
Many users and st;rvice providers and a limited number of TOs strongly stressed the need 
for competition to be; extended to the provision of infrastructure. 
Such competition should cover both self-provision of infrastructure and the opening up of 
access to third party infrastructure owned, for example, by other utilities or by the cable-TV 
networks. Supporters of infrastructure competition believed it should form an integral part 
of the overall timetable to be established as a result of the Review. 
Infrastructure competition was seen as the best means of overcoming the lack of high 
capacity leased lines in tfie Community, in particular to support the development of private 
corporate networks. 
However, a large number of TOs pointed to the complex nature of any liberalisation of 
public infrastructure;, and the implications any such move would have for their current 
financial equilibrium and their obligation to provide universal service across the whole 
national territory. 
(35) Phasing and Timetable 
There was general agreement on the need for a clear timetable to be established with 
identifiable milestones up to tfie end of the decade. This would provide business with a 
clear framework within which to plan its operations, whilst allowing TOs and service 
providers to plan future investment. 
There was wide support for a phased approach. This would allow, in turn, existing and 
proposed measures to be implemented; tfie problems of closed user groups to be 
resolved; and the gradual introduction of greater competition in (public) voice telephony 
both between Member States and within Member States. 
Tfie speed of transition towards greater liberalisation was seen by all as an absolutely 
critical issue; since it fias to take place in the broader context of commercial, political and 
technological developments. 
Users, service providers and a number of TOs supported fairly rapid moves towards each 
of these phases with full achievement of Option 3 (full liberalisation of voice services) being 
proposed by some; for tlie middle of the decade. 
Other contiibufors. traefe; unions and.(IK; majority of TOs insisted on the need, for-a more 
extended' transition phase», in e)ielerr to adjust tariff structures and to complete current 
investment programmes. Some TOs indicated that such adjustment could be completed 
within a periexl of some five years, while others pointed to their particular national situation 
aiKf their, special commitments wilfi regard to-peripheral regions as justification for longer 
transitional arran<jeine;nt s 
Generally, there seems to be a widely-held view that Option 3 could be reached before the 
end of the decade. 
There was general'sensitivity to the needs of the peripheral regions and to countries with 
small networks and to tfie requirement that Community support and transitional 
arrangements, taking .iccount of their specific situation, would have to be accommodated 
into any timetable eventually adopted. 
17 
EVALUATION BY THE COMMISSION 
(3(>) On the; basis e>f tlie; comme;uts ancf its analysis of the submissions, the Commission considers that 
it is possible; at this stage; 
to identify areas of general consensus amongst all market participants; 
to set out general positions on future development of telecommunications in the Community 
which are supported by a broad range of parties; 
to identify actions required for the development of the future regulatory environment. 
This is set out below. 
A. Areas of General Consensus 
(37) Tlio Commission has found from tlie consultations that: 
- there is a general conviction that further opening of markets is inevitable and necessary 
whilst maintaining universal service; 
- there is, at the same time, emphasis on the requirement for financial stability within the 
sector and recognition of the need to have a clear, agreed timetable for regulatory 
changes, with defined milestones up to the end of the decade; 
- there is general emphasis that a realistic, economically viable, and socially acceptable 
approach must be taken, involving careful phasing and progress in stages. 
Contributors to the consultation have shown a general conviction that further opening of 
markets is both inevitable and necessary. Telecommunications organisations in Europe 
arc already competing, either individually or jointly, for the business oL multinational 
organisations. New services are available now from European and other TOs to customers 
situated outside tfie operators' homo markets . In reality, this establishes such TOs as 
additional providers of public switched telephone services, alongside the incumbent 
national operator. 
The increase in choice, fuelled largely by technological advances, and the creation of 
innovative and advanced new trans-European services that comes about through 
liberalisation are essential to improving tlie competitiveness of European industry. Without 
. For example, "I )i;il direct" services, which were initially marketed as a way for travellers to phone their home 
country without incurring hij>,h surcharges imposed by some hotels, are now offered !>y most TOs in OECD 
countries. An extension of this concept, "Third Country ('ailing", is available on a more limited basis and allows 
calls to be made between countries, neither of which "hosts" the service provider. A third but quite distinct 
service known as "call back", which l>ypasses ihe public telephone service run by the traditional international 
carriers, is offered l»y several companies. 
these services, Ihe; Community will be at a growing disadvantage compared to Other 
deve;lopeel economies in Hit;-world; a peiint -emphasised by major user organisations. 
At «ho same; time', it is clear that further liberalisation would have to be implemented in a 
way which mainlains the financial stability of the telecommunications sector, particularly 
with regard to its investment capacity and the fulfillment of its public service obligations. A 
clear, lejng tt;rm timetable for regulatory changes with defined milestones is therefore 
imperative 
-Furthermore, tfie Community's approach must be realistic with careful phasing and 
progress carrkxf out in stages. 
The general positions on future development set out below provide a firm basis for 
structuring such an approach. 
B. General Positions on Future Development 
(30) Based on the consultations, tfie Commission considers: 
• There is broad emphasis that the first phase of future development should be the 
full practical application of current Community measures and adoption of 
pending legislative proposals. In particular, this must cover: 
- the practical application of the Services Directive, where there was a general 
request for clarification of the scope of liberalisation of private voice services, 
particularly concerning corporate networks and closed user groups, resulting 
from the Directive; 
- the adoption of: 
- the measures introduced under the ONP programme, including the current 
proposals for directives on voice telephony and the mutual recognition of 
telecommunications licences; 
- the proposed directives in the field of satellite communications; 
- appropriate measures for mobile communications. 
• There is general acceptance that, beyond the first phase of consolidation of the 
current regulatory framework, the longer term trend towards full liberalisation of 
publie: voit;t; telephony, represented by Option 3, is inevitable and necessary as a 
result of technological and market developments. Full liberalisation before the 
end t)l the; de;e:ade was generally field to be a realistic timescale. 
However, progress towards this goal is considered conditional upon: 
19 
the» establishment e>l a timetable;, defining the; phases for the development of 
the; ne;e:e;ssary regulatory framework, with regard in particular to the provision 
of universal service, the; framework for interconnection and access charges 
and taking account of the international dimension; 
the; financial stability of the sector being safeguarded; 
the; iu;cessary provisions for tlie peripheral regions and smaller networks; 
- the environment that facilitates the development of trans-European networks. 
• Option 4 (liberalisation of telephony between Member States) was identified as a 
suitable intermediate step towards full liberalisation by many contributors but was 
rejected as an isolated option. It was, however, considered, in particular by a 
majority of TOs. that it would have to be finked closely with full liberalisation and 
be placed within tfie framework and timescale for Option 3. 
• As regards infrastructure liberalisation, there were widely diverging opinions: 
- there was strong insistence by service providers and users on rapid opening 
of infrastructure to competition, with particular emphasis on infrastructure 
provision to enable full use of corporate networks and closed user groups; 
- others insisted that further liberalisation of services should initially rely 
exclusively on leased lines. 
A number of comments called for the development of a Community position on the future 
use of proprietary infrastructure networks (railways, utility companies etc) and cable-TV 
networks for transmission of telecommunications services which are already liberalised or 
will be liberalised. 
C. Identification of Action required for Future Regulatory Environment 
(39) From the comments received, it is apparent that progress towards the general positions 
set out above will be conditional on establishing the necessary regulatory framework. 
On the basis of tfie comments, the Commission finds that the following issues must be 
considered at Community level: 
- full application of the current regulatory environment; 
- a common definition of universal service principles; 
- development of a framework for interconnection agreements; 
definition of access charges principles; 
ensuring tlie independence of TOs; 
20 
tHisurinq se>e:ial anel rc;gie>nal cohesion 
pre;paring the <;nvironment Un trans-European Networks; 
arrival at a balanced approach to infrastructure provision; 
securing a balane:t;ei inte;rnatie)nal envimnmcnt; 
- development t>l a robust regulatory framework with a balance between national 
regulation and Community co-ordination. 
These issues are addressed below. 
21 
VI KEY FACTORS FOR THE DEVELOPMENT OF THE FUTURE REGULATORY ENVIRONMENT 
On the; b.isis til the consultations, the; Commission consielers the following lines of action as the 
best way e>f mewing towards a rcgulateny environment for the future. 
A. Consolidation of the Current Regulatory Environment 
(40) To enalilc the; regulatory environment as currently conceived to become fufly effective in 
the short term, tlie; following steps need to h© taken: 
- completion of tin; ajifjNcotion of the Services Directive (90/388/EEC) in particular to 
more dearly establish the scope of corporate networks and closed user groups; 
- fuH HTipfemetdation of ONP Leased Lines Directive (92/44/EEC); 
- adoption of tfie f iroposal for an ONP voice telephony directive (COM(92)247); 
- adoption of tfie proposal for a directive on the mutual recognition of 
telecommunications services licences to consolidate current regulatory framework 
(COM(92)254); 
- rapid adoption of the proposals for directives in the field of satellite communications; 
- launch of a Green Paper on mobile/personal communications. 
B. Common Definition of Universal Service Principles 
(41 ) The development of a balanced regulatory framework requires clear recognition of the vital 
principles of public service In this area : 
• universality, i.e. access for all, at an affordable price ; 
• equality, i.e. access independent of geographical location ; 
• continuity, i.e. continuous provision, at a defined quality. 
The essence of these principles of a universal service obligation - to make available a 
defined minimum service of specified quality to all users at an affordable price - is 
embodied in existing ONP measures and proposals currently before the Council and 
European Parliament 18. Specifically, once all measures have been adopted and 
implemented, the principles of universal service at a Community level will cover: 
IK .Council Directive of 2K June 1990 on the establishment of the internal market for telcommunications services 
through Ihe implementation of open network provision (90/.W7/IÏBC). The Directive defines, inter alia, the 
general principles of access to networks and the necessary safeguards based on essential requirements (security of 
22 
Initial provision e>l servies; 
Member State;s must «usure tfie provision of a public telephone network and 
voice telephone service. Users have a right of access to and use of the public 
telephone network, to a contract specifying the service and the target delivery 
perkxl (waiting time for initial provision) must be published. 
Spe;cial public service features 
Member States must etisure the provision of (i) public pay-phones, including 
access to emergency services, (ii) directories to users, and directory information 
to otficrs and (iii) access to international voice telephony services, including use 
of international access code 00. 
Quality of service 
Member States must ensure the publication of quality targets and information 
about the service for users, including numbering plans, and the monitoring and 
publication of quality levels achieved by TOs. 
Prices 
Harmonisation of tariff principles, in particular cost-oriented pricing, together with 
the possibility of special and targetted provision for socially desirable purposes 
(eg low income groups, handicapped users etc). 
Provision of conciliation/dispute resolution procedures for users 
Minimum service features 
The proposed minimum features for voice telephony includes: itemised billing; 
harmonised network interfaces, including the ISDN socket; special network 
access and a set of advanced features. 
Mandatory minimum features to be implemented in all Member States for leased 
lines include five types of line and common ordering and billing. 
network operation, maintenance of network integrity and, in justified cases, interoperability of services and data 
protection). 
Council Directive of !S June 1992 on Ihe application of open network provision to leased lines (92/44/EEC). 
Commission proposal for a directive on the application of open network provision (ONP) to voice telephony, 
< oin(92)247. 
( .'ouncil KecomineiKl.it ion of S June 1992 on the harmonised provision of a minimum set of packet-switched data 
services (f'SDS) in accconlaivcc with open network provi.sion (ONI*) principles (92/382/EEC). 
Council Recommendation «>l .*> June 1992 on the provision of harmonised integrated services digital network 
(ISDN) access arrrangcmcnls awl a nnninvum sel of ISDN offerings in accordance with open network provision 
(ONI1) principles {*>2/.m/lil:A'). 
23 
Minimum leaturev; are; re;e:e>mme;iulc;d for packet switched data services and 
ISDN 
As recognised in the; consultation, tfie introduction of further competition makes it all the 
more necessary to define the; principles of universal service. 
The Commission considers that the existing and proposed ONP measures provide a valid 
framework at the Community level lor such a definition, while retaining sufficient flexibility 
to take account of spocilic national situations. 
The main Community objective in this area should therefore be the rapid adoption and 
implementation of those measures. 
After full application in the Community, further development of the principles could take 
place where required and on the basis of practical experience. 
C. Development of a Framework for Interconnection Agreements 
(42) Interconnection is tlie key to achieving Community-wide services based on competitive 
provision of services and networks. Interconnection agreements establish the rights and 
obligations utidcr which sorvice providers and network operators interconnect their 
facilities. 
Since the cost and level of interconnection has been shown to be a crucial factor in the 
viability of a new service, it plays an essential part in the development of the market. 
(43) The proposed ONP voice telephony directive contains a framework for interconnection 
agreements. The main elements of this framework are: 
• Rights ol network access / interconnection 
Users, including competitive service providers, will have a right of equitable and 
non-discriminatory access to telecommunications networks at the normal 
interfaces and normal tariffs. In the case of the telephone network, users may 
also request access at non-standard interfaces and non-standard tariffs ("special 
network access"). 
Telecommunications organisations must meet the legitimate requests for 
interconnection from other telecommunications organisations (for voice 
telephony). Intercommunication between leased lines and public networks must 
not bo technically restricted. 
• Charges 
For normal network access, normal tariffs apply in accordance with the principle 
of non-discrimination. In the case of special network access and 
24 
i!itere.onriee:lion, :.pe?e:ial charge's may apply but the;y must be cost-oriented, non-
dist:iiminatt«y, fully justifient and approved by the national regulatory authority. 
• Harmonised technical standards 
Member Slates are; to encourage the use of European or international standards, 
where they exist. Whore European standards do not exist, ETSI will be asked to 
develop harmonised standards for new types of network access and 
interconnection. 
• Numbering 
Numbering plans must be controlled by the National Regulatory Authority, in 
order to provido for fair competition. Allocation of numbers must be objective, 
transparent anef non discriminatory. 
The provisions for access/interconnection agreements incorporated in the proposed ONP 
voice telephony directive, appear to provide a sufficient initial framework for such 
agreements, so far as the Community level is concerned. 
With phased progress towards increased liberalisation, this framework may have to be 
reviewed. The definition of TOs in the ONP framework currently refers to the special or 
exclusive rights enjoyed by these organisations. With further advances towards 
liberalisation it may be more appropriate to establish other criteria such as market position 
as the basis of this definition, in order to adjust to the evolving competitive environment. 
D. Definition of Principles for Access Charges 
(44) Access charges are paid for interconnection to an incumbent TO's network by competing 
operators. In addition to compensating the incumbent TO for delivering calls, access 
charges can: 
- compensate the TO for the loss of that portion of revenue which may contribute to 
universal service obligations, thereby allowing competition to be introduced in advance 
of full tariff rebalancing; 
- provide a mechanism, even when tariffs have been re-balanced to become cost-
oriented, for fairly sharing tlie burden of universal service obligations. 
(45) Under the proposée! ONP voice telephony directive, these key aspects of access charges 
are being addressed. The following principles are set out: 
a. Access charges apply to TO interconnection. 
b. Tfiey are permitted when the two operators have different regulatory obligations 
placed upon them. A universal service obligation or price controls imposed on 
25 
only one; e»f them would be; typical examples of the regulatory obligations 
envisaged. 
c. All sue:h e:hareje;s must In;: 
cost t>iie;nl(xl; 
non < list :rimini ttory; 
- fully justifient; 
based on regulatory obligations placed on the parties by the Member State; 
- approved by the national regulatory authority. 
In the case of "sfiecial network access" given to service providers, a TO may be 
reimbursed for costs incurred in providing the type of special network access requested. 
(4G) The Commission recognises the essential role of access charges in securing the 
maintenance and development of universal service and the capacity to finance it, in 
particular with regard to the peripheral regions. At the same time, the appropriate use of 
access charges within the given framework will allow the progressive adjustment of tariffs 
towards cost orientation. 
E. Independence of Telecommunications Organisations 
(47) With further progress towards a competitive environment, telecommunications 
organisations must be free to respond to the dynamics of the marketplace if they are to 
operate effectively. The degree of freedom must be proportionate to the level of 
liberalisation. Major aspects of this freedom include tariff policy and equality of treatment. 
(48) There is the basic need for further and continuing adjustment of the level and structure of 
the prices of telecommunications services in the Community towards "greater cost-
orientation. TOs must be able to react to the downward competitive pressure on prices in 
market segments where their offerings are at present substantially above costs. However, 
tills must be achieved without producing adverse effects on vulnerable groups of 
consumers. This can be achieved tfirough allowing TOs a sufficient degree of pricing 
flexibility, particularly in sectors where they face most competition. Such flexibility is also 
critical for the take-off of new, advanced, revenue-earning services. 
Techniques such as price capping and access charging provide a flexible means to control 
the rate at which re balancing occurs and avoid adverse effects for users and markets. 
Thus, further liberalisation ami tariff rebalancing can proceed hand in hand. The use of 
targetled schemes can lielp universal service obligations to be met more effectively and 
access charges ensure that the burden is shared fairly by all market participants. 
SUB 
(40) Member States should provide for financial Independence of TOs and progressively 
withdraw burdens or requirements unrelated to the basic tasks entrusted to ihem. Equality 
of treatment Is central with regard to freedom from obligations not related to 
telecommunications and fuller access to sources of capital. 
In a Community context. 10s must have full freedom, subject to the Community's 
competition rules, to enter alone or jointly the markets newly opened to competition, 
particularly In trans-European services and networks. The I Os should be allowed to take 
the necessary organisational and financial measures required to advance towards this 
objective. 
In a compétitive market, commercial considerations must be allowed to have effect and an 
appropriate degree of flexibility must be extended to the TOs. They should not be 
disadvantaged relative to their competitors. 
F. Ensuring Social and Regional Cohesion 
(50) It is Important to maintain a balanced economic and social development throughout tfie 
Community. Further liberalisation should create new employment opportunities and 
ensure further integration of peripheral regions. 
Cohesion requires a stable and viable investment environment At a regional level it must 
ensure the modernisation and Increased penetration of services and networking 
Infrastructures in peripheral parts of the Communlty. 
(51 ) Self-financing by TOs to meet the investment requirements of peripheral regions is. and will 
continue to be, insufficient While progressive liberalisation will increase usage and cash 
flows and stimulate Investment In the peripheral regions, there is uncertainty as to the 
extent and the period in which these benefits will be felt in the peripheral regions. The 
Commission recognises the need for special arrangements for additional transition periods 
and for access charges, in order to safeguard investment capabilities in the countries 
concerned in the short to medium term. 
(52) Resources from operations must contribute to the extension of infrastructures and services 
into marginal or non-profitable areas, but public financing will also be needed, including 
from the Community's Structural Funds. 
As set out In the Communication of October 1992, funding under the Community Support 
Framework has made a substantial contribution to the development of telecommunications 
services and network investment In the peripheral regions in the recent past In the context 
of liberalisation and privatisation of public services generally within certain Member States, 
the Funds have had to devise new conditions for funding to ensure that investments from 
Community sources continue to have their Intended beneficial effects for the consumer. 
Assuming this corresponds to the spending priorities of the Member States and regions 
concerned, grant funding for telecommunications could be stepped up in the coming 
planning period (1994-99) in view of the increased resources allocated to the Structurai 
27 
Iiiiuls. I nillie'iinoii;. the; e>n <|<>in<j le;iieling proejramriu;s e)f the; European Investment Bank 
cm he; expanded (olleiwing the; launch ol the; Lurope;an Growth Initiative, including the new 
Tempoiaiy I e;neling Facility (TLF) and the European Investment Fund (EIF) 
G. Preparing the Environment for Trans-European Networks 
(53) In addition to its potential contribution towards ensuring social and regional cohesion, 
increasing liberalisation in the sector will be the most effective way to stimulate investment 
in trans-European telecommunications networks, both by the incumbent TOs and by new 
entrants. Liberalisation will open the way for further co-operative ventures between groups 
of operators in order to offer genuine pan-European telecommunications service on an 
end-to-end basis. 
Further liberalisation will be a precondition for attracting new investors and fully using the 
new financial facilities established for developing trans-European networks, mentioned 
above.19 
The Commission recognises that there is a need for trans-European networks which may 
necessitate cooperative arrangements between operators, in compliance with the rules of 
competition. 
H. Working out a Balanced Approach to Infrastructure Provision 
(54) As set out earlier, the consultation has shown widely diverging views with regard to the 
further regulation of the network infrastructure. 
While users and service providers emphasised the need for early liberalisation, TOs 
stressed the need for stability and long-term Investment planning in this area. 
The main aspects addressed in this area in the consultation were the following : 
- there is the general question of the future of public network infrastructure ; 
- telecommunications services except public voice are already liberalised according to 
current Community legislation, including voice for corporate networks and closed user 
groups. A main issue is the full application of this existing legislation ; 
- in this context, the question arises whether alternative infrastructure should be made 
available in order to make tfiis liberalisation more effective 
The Commission recognises that fundamental changes to infrastructure regulation can 
have significant consequences for tfie incumbent TOs in terms of their financial resources 
.The ( ommission intends to .submit .shortly a series ol proposals lor the promotion of tran.s-Huropcan networks. 
'Iliese proposals will cover in particular tran.s-Huropcan ISDN, tran.s-Huropcan broadband communications and 
traii.s-Huropcan networks between Administrations, as well as related services and applications. 
28 
.nid Inline; inve;sline;nt e;apability. especially whe;re the network size is relatively small or 
whe;re; the; ne;twe>rk build-up will only be completed within periods of five to ten years. 
Convt;rse;ly, there; is undoubtedly a significant demand for high capacity infrastructure 
particularly in the field of corporate networks and closed user groups which is currently not 
being met. Furthermore, additional investment into trans-European networks and 
peripheral regions is required and new opportunities for attracting capital need to be fully 
explored, to catch up in this area with current developments in the United States and 
Japan and particularly to ensure lull use of the advanced applications resulting from the 
Community research programmes. 
(55) A number of Member States currently allow the separate provision of infrastructure for 
specific telecommunications applications and services as "independent networks" for other 
utilities, the railways and, in certain cases, closed user groups. These represent a useful 
yet underutilised resource which may have a wider role to play in the development of 
corporate communications and communications for closed user groups. 
Users and sorvice providers particularly called for the opportunity to fully exploit corporate 
communications and tfie operation of closed user groups. They emphasised the need to 
include the supporting infrastructure in such provision. 
Some users and cable-TV providers consider that cable-TV could have a role to play in the 
provision of services that are already liberalised. 
Building on existing provisions in a number of Member States, the Commission considers 
that such concepts should therefore be extended under certain conditions and that the use 
of own infrastructure for a user's applications, or the provision of capacity for corporate 
networks and closed user groups should be included in the concept of corporate 
networks/closed user groups, subject to additional study investigating the effects of such 
a measure, in particular with regard to consequences for the incumbent TOs. 
(5C) As regards tfie general question of the future of public infrastructure, the Commission 
considers that the current consultations do not allow a final position to be formulated. 
Once additional experience is gained, a further broad consultation will be needed to 
determine the best way forward. Such a consultation should address the global regulation 
of the communications infrastructure, including telecommunications and cable-TV 
networks. 
Tfie Commission believes that this should be addressed within the concept of a Green 
Paper on telecommunications and cable-TV network infrastructures. 
I. Ensuring a Balanced International Environment 
(57) Further liberalisation within the Community must be linked to equivalent opportunities in 
other markets 
29 
At pre;se;nt the're; is ne> me;e:hanism to e;nsure that market access granted in the Community, 
de; jure; e>r ele; facto, is adequately compensated elsewhere. The issue of ensuring similar 
access is ne;e:e;ssarily linked te) the ongoing negotiations in the GATT. There is general 
aejre;e;rne;nt that the; be;st solution is through such multilateral negotiations. 
Although the GATT process has been slower to obtain results than anticipated, the basis of 
a framework for telecommunications has evolved during the Uruguay Round sectoral 
negotations, in particular through the draft General Agreement on Trade in Services 
(GATS), which has been virtually finalised. 
Tfie Community should \n the context of the future negotiations in GATS ensure that the 
benefits that operators from third countries will derive from Community liberalisation will be 
balanced by comparable opportunities in their home telecommunications markets. 
The GATS specific telecommunications annex sets guidelines relating to access to and use 
of the network for the provision of telecommunications and other services. A series of draft 
offers, or commitments, from several countries have been made to lift restrictions in certain 
segments of the telecommunications market. 
The Community's contribution to the GATS telecommunications annex was based on the 
Of) ongoing work on ONP and related areas . 
In the Commission's view, the GATS framework provides a basis for developing a balanced 
international environment through multilateral negotiations. Purely bilateral approaches 
would run the risk that rules would be shaped by the strongest players, with Community 
interests possibly being compromised. 
Progress in this area will have to be coordinated with the further progress of liberalisation 
within tlie Community. Any approach would also have to take due account of the 
Community's relationship with the EFTA countries and the realisation of the European 
Economic Area. 
Licensing conditions can play an important part in securing balanced conditjpns regarding 
issues such as ownership constraints in third countries . 
J. Developing the Balance between National and Community Regulation 
(58) The Commission stated in its Communication of October 1992: 'In the context of the 
internal market there is a need for both harmonisation and liberalisation at Community 
level in order to ensure that the development of telecommunications across the 
Community is not impeded by national barriers or practices which are incompatible with 
the achievement of the objectives of the Treaty.' 
A> In the ( iA'l"S negotiations, ihe ( 'omnuinity has made an offer concerning value-added services and basic data 
scivices, based on Ihe current slate of liberalisation within the Community. 
"' The Commission is currently addressing this issue in the context of the preparation of the proposal for the 
Community-wide mutual recognition of satellite licences. 
30 
Tlie; He;vie;w envisage*J. "minimum action necessary at Community level in order to remove 
obstacles to the provision of the widest possible range of telecommunications sources. 
Within the framework thus created at Community level, Member States will continue to 
determine their own telecommunications policies." 
The principle; of subsidiarity is incorporated in tlie existing ONP framework, whereby the 
national regulatory authorities fiave tfie primary responsibility for regulation at a national 
level. Tfie Community's role is mainly to spell out general principles, to offer conciliation in 
disputes which cannot be resolved at a national level and to assist in establishing a 
consistent approach throughout the Community. 
The current definition of principles for dispute resolution and regulatory oversight, as set 
out under tfie proposed ONP voice telephony directive, are as follows. 
(59) At a National Level: 
the national regulatory authority (NRA) has an obligation to intervene if requested by 
either party, 
the NRA has an obligation to ensure that interconnection agreements are non­
discriminatory, fair and reasonable to both parties and offer the greatest benefit to all 
users, 
the NRA has a right to impose conditions in interconnection agreements concerning 
technical standards, quality requirements, conditions safeguarding the essential 
requirements, and to impose deadlines for implementation of interconnection 
agreements; 
Member States must establish procedures for resolving disputes between 
telecommunications organisations and users. 
(60) At Community level: 
- users may invoke tlie Conciliation procedure to resolve disputes not resolved at a 
national level; 
- the Commission may take measures to secure provision of particular pan-European 
services. 
Apart from the ONP framework, the Commission may invoke the competition rules in the 
case of abusive befiaviour or anti-competitive agreements, as it has done in a series of 
cases in tfie past. 
31 
As set eiut in the Communication of October 1992, the European Court of Justice has 
ceinfirmtMi the; application of Community competition rules to the sector in a number of 
decisions. Furllit;rme)re;, general principles of the application of the competition rules -
and in particular of Articles 85 ancf 8(> of tfie EEC Treaty - have been set out by the 
Commission in its guidelines on tfie application of EEC competition rules in the 
telecommunications sector . 
Community competition rules in tfie sector will have to be applied carefully in order to take 
into account : 
- the need to make liberalisation effective so that all entrants can compete on a fair basis ; 
- the emergence of beneficial forms of cooperation where they are necessary, for 
example, trans-European networks, and structural adjustments, including mergers23, 
which promote the development of a Single Market. 
In tfie assessment of such developments account will be taken of the situation of 
participants on the European and on non-European telecommunications markets. 
The introduction of competition requires effective regulation at national level and improved 
regulatory mechanisms at Community level. This in turn demands that national regulatory 
authorities fiave adequate powers of regulation, and that those powers are applied in a 
consistent manner in all Member States. 
In addition, strengthened mechanisms to handle problems of a Community-wide nature will 
be needed. Issues such as the resolution of interconnection disputes between 
tefecommunications organisations in different Member States and the mutual recognition 
of licences can not be handled by one Member State or one national regulatory authority 
acting alone. 
In its proposal for the mutual recognition of licences in the Community (submitted within 
the ONP framework24, with tfie objective of facilitating the free movement of services), the 
Commission has proposed the setting up of a Community Télécommunications 
Committee. The Committee could be composed of the members of the current Ad Hoc 
High Level Group of National Regulators, created by Council specifically for the Review, or 
by their representatives. The Committee could, together with the other committees in this 
field, m particular the ONP and ACTE Committees, form part of a coherent regulatory 
structure at Community level. 
Tfie Community woukf build finks according to established proceriures and, In compliance 
with the; princifjfe of subsidiarity, witli the committees and institutions created within me 
( tuiilclincs on the apj>Jica(ioii of |-|{( ' competition rules in the Iciccimmiuntcaltons sector (91/C233/02, OJ 
C2*l,fc.«>.9|). 
( .'ouru'ii Kegulat ion 4t)MfWi of 21 1 kivmlK*r f UR9 m% the control «f concentrât wits between undertakings (OJ 
IW0I.2S7/14) 
24 
2\ 32 
Cl PI. in partie:ular FCIRA/ENO25 (in tlw; fie;kf of licensing and numbering), ERC/ERO26 
(in the; lu'lel of mdiocommijnicatitMis) and with tfie standards organisations ETSI and 
Of .N/CI NI 11C;v (in the fie;ld of technical standards).20 
Tfie; current regulatory structure in the Community is founded on the complementary role 
of national and Community regulation, evolving according to the principle of subsidiarity. 
Regulation at Community level is based on the developing ONP framework, the application 
of Community competition rules and the cooperation procedures in place or being 
developed with the committees and institutions referred to above. The Commission 
considers tliat an assessment will have to be made, on the basis of future experience, of 
the need for furtfier evolution of tin's structure. 
.Proposal for u Council Directive on (he mutual recognition of licences and other national authorizations to 
operate telecommunications services, including the establishment of a Single Community Telecommunications 
I Jcciicc and the selling up of a Community Telecommunications Committee, COM(92)254. 
..liCTKA - European Committee of Telecommunications Regulatory Authorities 
ENO - lùtropean Numbering Office (requested by Council Resolution 92/C 318/02 of 19 November 1992 on the 
promotion of Europe-wide cooperation on numbering of telecommunications services (OJ C 318/2, 4.12.92)). 
. ER( ' - European Radiocommunications Committee 
ERO - European Radiocommunications Office (created in accordance with Council Resolution 90/C 166/02 of 
28 June 1990 on ihe strengthening of Ihe European-wide cooperation on radio frequencies, in particular with 
regard te> services with a pan-European dimension (OJ C f 66/4, 7.7.90)). 
. liTSI - Iùirope.in Tclecommuim.itions Standards Institute 
( *EN/( "ENEEEt " - European ( 'ommiltee for Standardisation and Elect r«H ethnical Standardisation 
.The e "omiiiission has concluded or intends to conclude - Memoranda of Understanding and framework 
contiacts on coopeialion with these organisations. 
The ( ommission will submit shortly a ( 'ommunicalion on relations with the ERC/ERO in the field of 
radiocommunications. 
33 
VII THE PROPOSED SCHEDULE 
(til) The; Commission ctinsiders that the; amas eif general consensus and the positions on future 
tle;ve;le)pment e>f the; sector se;t out in the comments allow the definition of consistent objectives 
and a detaiUni timetable for tfie further development of telecommunications in the Community. 
There is general agreement on a first phase concentrating on consolidation and preparation, 
together with the developing market impact of the existing or currently proposed legislation. This 
should include the public.Hion of a Green Paper on mobile communications. 
Tfiere is also a broad consensus about tfie inevitability of full liberalisation (Option 3, which 
includes Option 4) before tlie end of the decade in a second phase, with indications for the lime 
re;cjuired to adjust structures of about five years. 
Tfiere is further general sujiport for providing special arrangements and additional transitional 
periods for peripheral regions and smaller networks. 
Tfiere remain different views concerning two issues: introducing Option 4 (liberalisation of voice 
only between Member States) rapidly as an intermediate step; and the future of infrastructure. 
(62) As set out, the Commission believes with regard to infrastructure regulation, that the general 
question of the future regulation of public infrastructure should be addressed within the context of 
a Green Paper. 
However, whilst ensuring the full application by Member States of existing Community legislation 
and in particular in relation to corporate networks and closed user groups Is a priority objective, 
the Commission also considers that tfie early use of Infrastructures limited to own applications or 
to provision of capacity for corporate networks and closed user groups could substantially 
reinforce the effect of this legislation In this area, subject to additional study on the effects of such 
a measure. Such a measure would be essential for catching up with the United States and Japan 
particularly in the fields of high speed advanced applications, and the full use of-the results of 
Community research programmes in this area. 
Tfiis aspect should therefore be included in tlie first phase. 
Tin; Commission also Ixïlieves that the use of cable-TV networks should be considered for the 
provision of currently Hl>eralised services, subject to additional study. 
34 
(<).i) Willi ie;gard le» Opiion 4, IIH; Commission ;M:cepts tin; re;ejuire;m<;nt feir close correlation with full 
liberalisatitin. Ihe; <:t)mtne;nls have; confirmed the urge;nt need for action in the field of trans-
fmntie;r communicatieins and the requirement for rapid development of trans-European networks. 
Given, however, that on the; basis of the consultation, a consensus on full liberalisation - which 
implies liberalisation tif voice telephony between Member States as an integral element - has been 
achieved, an intermediate step no longer seems necessary, subject to a firm commitment by the 
TOs and regulators to prtigrammes ol adjustment of tariff structures towards cost in order to 
prepare for such a competitive market. 
This leads to tlie following proposed schedule. 
A. Major Steps 
The major steps in the proposed schedule focus around two phases. 
First phase (1993 - 1995): 
- ensure fuH api>lication by Member States of existing Community legislation and, in 
particular, in relation to corporate networks and closed user groups; 
- use of alternative infrastructure for own applications, or provision of capacity for 
corporate networks / closed user groups, subject to additional study on the effects of 
such a measure and the establishment of appropriate conditions to reinforce the effect 
of application of existing legislation in this area ; 
- use of cable TV infrastructure for telecommunications services currently liberalised, 
subject to addttibrial study on the effects of such a measure ; 
- accelerated adoption of pending proposals, in particular the proposals in the field of 
application of ONP to voice telephony and the mutual recognition of licences; 
- furtfier devek>f>n»eiit of principles on universal service / interconnection and access 
chargos / licensing, based on experience gained from the implementation of current 
legislation and projiosals; 
- accelerated adoption of tfie proposals in the field of satellite communications; in 
particular, liberalisation and mutual recognition of licences; 
- adaptation plans for accelerated development and special arrangements, where 
necessary, m order to take account of the situation in the peripheral regions and small 
or less developed networks; special measures in the context of Community support 
frameworks, complementing funding from own sources, to accelerate network 
development and universal service m tlie peripheral regions; 
35 
ensure in Ihe; GATS negotiations ceimparabfe market access to telecommunications 
se;rvie:e;s markers in third countries. 
publication til a Green Paper on Mofjile / Personal Communication before 1 January 
1994; 
publication e>l a Green Pap(;r on the; future of public network telecommunications 
infrastructure; and cable TV networks, before 1 January 1995. 
Second phase (1990 1998): 
examination, prior to full liberalisation, of progress on structural adjustment, in particular 
of tariffs, in those countries experiencing specific difficulties in order to take account of 
the situation of the peripheral regions and small or less-developed networks, including 
definition of additional transition periods, where justified, which should not go beyond 
two years. 
full liberalisation of public voice telephony services by 1 January 1998,; 
working out of a future framework for regulation of public network infrastructure subject 
to the results of the consultations on the Green Paper on infrastructures. 
B. Timetable for Action 
This translates into the following proposed timetable for action, taking account of the 
global balance of tfie approach proposed : 
Before 1 July 1993 
Before 1 January 1994 Council Resolution defining the global objectives for future 
regulatory change (including commitment by Member States 
to full liberalisation of voice telephony, subject to the 
conditions and the transition periods set out); 
Adoption of pending Directives (ONP voice telephony, mutual 
recognition of licences) and satellite directives package; 
Amendment of Directive 388/90, in order to integrate the 
objectives of the first phase and prepare the start of the 
second pfiase; 
Publication of Green Paper on Mobile / Personal 
Communication. 
36 
~ Before t Jantiaty 1995 
Before 1 January 1996 
Before 1 January 1997 
Before 1 January 1998 Publication of a Green Paper on future regulation of public 
network telecommunications infrastructure and cable-TV 
networks. 
Amendment of the ONP framework, where required, 
according to tfie evolution of ONP principles based on the 
experience of the first phase; 
Completion of regulatory environment for full liberalisation. 
Continuing examination, prior to full liberalisation, of progress 
on structural adjustment in particular, of the peripheral 
regions and small or less-developed networks, including 
definition of the additional transition periods. 
37 
VIII CONCLUSIONS 
Ihe; consultations em the; 199? Telecommunications Review have demonstrated a degree of 
consensus amongst all actors in the sector which alleiws a schedule to be defined for the further 
regulatory development eif tfie sector up to tlie end of the decade. The Commission considers 
the definition of an early and clear schedule is vital for ensuring internal development of the 
sector. This will also enable the Community to strengthen its position in external negotiations. 
Having set a broad basis of reform with the Green Paper on Telecommunications of 1987 and 
subsequent measures, the Community must now take a further step to prepare its 
telecommunications sector for the future to the benefit of the user, the European economy and its 
workforce. 
The Commission, in its Communication of November 1990 on industrial policy, made market 
orientation an essential component of any policy for sectoral development. The Commission 
considers, on the basis of the consultation, that market orientation and public service in the 
telecommunications sector are complementary. 
The Community has made a substantial contribution to the promotion of the European 
telecommunications industry in the past, particularly through R&D programmes in the sector. 
Further proposals have been made in its Communication last July on the equipment industry. 
Further market orientation and opening will be required to allow the telecommunications sector to 
realise the full benefits of tfie Community's programmes and the development of trans-European 
networks, and of the new instruments created in the context of the Community's growth initiative. 
The Commission has welcomed the support the Council has given with its Resolution of 19 
November 1992 for the launch of the consultation process; and it welcomes the ongoing work in 
the European Parliament on the Review. 
The Commission transmits this report and draft Resolution to the Council and European 
Parliament. 
,^K 
b?''mi 
ANNEX I 
PROPOSAL FOR A COUNCIL RESOLUTION OF [ ] 1993 
ON THE REVIEW 
OF THE SITUATION OF THE TELECOMMUNICATIONS SECTOR 
AND THE NEED FOR FURTHER DEVELOPMENT IN THAT MARKET 
ANNEX 1:-page1 
PROPOSAL FOR A COUNCIL RESOLUTION ON THE REVIEW 
OF THE SITUATION OF THE TELECOMMUNICATIONS SECTOR 
THE COUNCIL OF THE EUROPEAN COMMUNITIES, 
Having regard to tfie Treaty establishing tfie European Economic Community. 
Whereas both Council Directive 90/387/EEC of 28 June 1990 on the establishment of the internal 
market for telecommunications services through the implementation of Open Network Provision 
(ONP)1. and Commission Directive 90/388/EEC of 28 June 1990 on competition in the markets for 
telecommunications services2, call for a review during 1992 of the conditions under which the 
Telecommunications sector operates in the Community. 
Whereas on 21 October 1992 the Commission submitted to the Council a Communication on the 
situation in the market for telecommunications services3, which assessed, in particular, the competitive 
situation, progress on harmonisation and restrictions concerning access to telecommunications 
networks, the effects of those restrictions on the operation of the internal market, and the measures 
that could bo taken to remove those restrictions. Whereas the Commission asked the Member States 
and interested parties to give their opinions concerning the communication and the proposals 
contained in it. 
Whereas the Commission on 15 July 1992 also submitted to the Council a Communication: Towards 
Cost Orientation and the Adjustment of Pricing Structures4, assessing progress towards cost 
orientation and adjustment of pricing structures for telecommunications within the Community. 
Whereas tfie European Parliament gave its opinion on both Communications on 20 April 1993. 
1 ON 192/10, 24 07.90 
2 Oil. 192/1,24.07.90 
•* SEC (92) 1048 
4 SEC (92) 1050) 
11 
ANNEX 1:-page 2 
Whe;te;as the; Ce>une:il Re;se>ltition e>f 19 Ne)ve;ml>e;r 1992s called upon the Commission to consider, in 
einstillation will) intt;re;stt;ri partie;s. tlie; |)olitie:al, econeimic, commercial and social implications of the 
eiptieins se;t out in the Commissiem communicatiein for the future of the Community telecommunications 
se;rvie:es market. Whereas the; Ctujncil requested the Commission on the basis of the consultation to set 
out a transparent approach and timetable for a future regulatory framework for the Community 
telecommunications market. se> as to allow regulators and operators to plan the necessary adjustments 
at national level. 
Whereas the Council established an Ad Hoc High Level Committee of National Regulators to assist the 
Commission in this task. Whereas the Council Resolution of 19 November 1992 welcomed the 
Commission's intention to report to it before the next mooting of the Council of Telecommunications 
Ministers. 
Whereas tfie Commission has carried out a wide-ranging consultation with all actors in the European 
telecommunications industry and, in particular, it has received the opinion of the users of 
telecommunications services, telecommunications operators, equipment manufacturers, service 
providers, and of the trade unions. 
Whereas on the basis of this wide-ranging consultation the Commission has submitted a further 
Communication to the Council on the outcome of the Consultation on the 1992 Telecommunications 
Services Review. 
NOTES AS GENERAL CONSENSUS RESULTING FROM THE CONSULTATION THAT: 
1. there is a general conviction that liberalisation of telecommunications services markets is 
inevitable and necessary as a result of technological and market developments; 
2. there is a general requirement for maintaining the financial stability of the sector and safeguarding 
universal service, while proceeding with the necessary adjustment of tariff structures; 
3. H is imperative to tiave a clear, long term timetable for regulatory changes with defined 
milestones, up to tlie etui of tlie decade, in orotar to give the sector the necessary stability; 
4. a realistic a|)prcjach must be taken involving careful phasing and progress in stages taking 
account of specific national situations; 
s .Council KesulutitMi 92/C 8/«t of 19 November 1992, OJ C2 6.01.93 , p. 5 
U 
ANNEX 1:-page 3 
!> Ilie.'te; is need lor lull implementation e>l Ihe; t:urre;nt re;gulatory (;nvironme;nt, in particular Directive 
9()/:MM/I I C 
(J the;re; is ge;ne;ral recognition o\ the value; te> users, industry and the whole of the European 
economy eif a strong telecommunications infrastructure and of advanced and efficient 
telecommunications service's provided on reasonable terms. 
7. the opening of the Community telecommunications market for third countries must be linked to 
comparable access to such countries' markets. 
RECOGNISES AS KEY FACTORS IN THE DEVELOPMENT OF FUTURE REGULATORY POLICY FOR 
TELECOMMUNICATIONS IN THE COMMUNITY: 
1. tfie rapid adoption of pending proposals for Directives concerning ONP, the implementation of 
the principle of mutual recognition of national licences and authorisations, as well as proposed 
measures in respect of satellite services; 
2. tfie definition of universal service principles for telecommunications services, building on 
existing Directives; 
3. tlio development of an appropriate framework and of adequate principles for interconnection 
agreements; 
4. the definition of access charge principles taking into account in particular the need for tariff 
rebalancing and the provision of universal services; 
5. the independence of TOs for the determination of their commercial policy, subject to 
appropriate regulation; 
6. the need to contribute to the cohesion of the Community, in particular with the development of 
trans European networks. 
7 the; need to take into account the situation eif peripheral regions and of very small or less 
developed networks; 
8. the; need to take account of changes in tfie overall employment situation within the 
telecommunications sectejr; 
L,( 
ANNEX 1:-page 4 
9. tlie; definition e>l a colM;rent appreiach to telecommunications infrastructure provision, 
10. the establishment of a balanced international environment with effective conditions for 
access to third country markets comparable to the ones existing in the Community; 
11. the development of a clear regulatory framework with an appropriate balance between national 
regulation and Community coordination, in conformity with the principle of subsidiarity. 
12. the need for cooperation, in particular in the field of trans-European services, and the 
role Community competition rules should play in that respect. 
II. the continuing need few a harmonised and open market for telecommunications 
equipment, subject tei ceimpaiahlc and effective access to third countries. 
CONSIDERS AS MAJOR GOALS FOR THE COMMUNITY'S TELECOMMUNICATIONS POLICY IN THE 
SHORT TERM: 
1. the rapid adoption of legislative proposals in the field of ONP and satellites, together 
with the full application of existing Community legislation in the field of 
telecommunications services and ONP, in particular, in relation to corporate networks 
and closed user groups; 
2. enabling the use and provision of alternative infrastructure for such corporate networks 
and closed user groups, subject to additional study and appropriate conditions ; 
3. enabling the use of cable TV nctwtirks for the provision of services currently liberalised, 
subject to additional study ; 
4. further development of harmonisation, on the basis of the ONP principles,-to extend 
the existing coverage of such issues as universal service, interconnection and access 
charges; 
5. the development til future ( ^immunity policy in the field of mobile and personal 
ctimnumications through the publication of a Green Paper on mobile communications; 
o. the development eif future Community policy in the field of public network 
telecommunications infrastructure and cable TV networks through the publication of a 
Green Paper in this area. 
Là 
ANNEX 1: - page 5 
CONSIDFRS AS MAJOR GOALS I OR Tl IE COMMUN! I Y'S TEL FCOMMUNICATIONS POLICY 
IN IHLLONGLR ILIiM. 
I. i ht: liberalisation of all public voice telephony services, whilst maintaining universal 
set vice ; 
2. maintaining the balance between liberalisation and harmonisation ; 
3. examination, prior to full liberalisation, of progress on structural adjustment, in 
particular ol* tariffs, in those countries experiencing specific difficulties in order to take 
account of the situation of the peripheral regions and small or less-developed networks, 
including definition of additional transition periods, where justified, which should not 
go beyond two years. 
4. the working out of arrangements tor suitable measures and transition periods, where 
necessary, in relation to specific difficulties encountered by the peripheral regions and 
small or less developed networks. Such measures, which will be designed to develop 
networks and ensure the provision of universal service in peripheral regions, should 
where appropriate be supported from public funds, including the Community's 
Structm a! Funds. 
3. the working out of a future fi amework for the regulation of public network 
infrastructure, on the basis of the result of a broad consultation process following the 
publication of the Green Paper on infrastructure. 
ENCOURAGES TITF. COMMISSION 
in its existing efforts to ensure the full practical implementation of all relevant: legislation in the 
field of telecommunications ; 
INVITES THE COMMISSION AND THE MEMBER STATES 
to continue consultation, in particular within the framework of the High Level Conimittee of 
National Regulatory Authorities set up by the Council in November 1992. 
URGES THE MEMBER STATES 
4? 
ANNEX 1:-page 6 
a) le» pie une >lc the piogic.ssive rebalancing e)l t;ti if IN (eiwards ceist-eirientation teigether with 
the- e -tmtiiitiini* de'vclopmcut e)l universal service 
l>) le) pte)viele fen the necessary I'inatu ial, enganisatieinal ami management independence of 
T( )s, in orde'r te) alltiw theni te) prepare' lor the competitive environment and take 
neee.s.saiy measures in the fields of organisation, ileveleipment prospects for staff and 
rebalancing of tariff structures 
/ L 
ANNEX 1:- page 7 
b) le) ensure, whe-te' apprtipriate', that sulTiciVnt funds are available from the Community 
siippt)rt structures and from their own resources to promote the development of Trans 
Furopcan Ne'tweirks, and tt) help peripheral regions and countries with very small or less 
developed nelweirks sustain their programmes of investment in telecommunications 
networks and service's. 
NOTES THE TIMETABLE PROPOSED BY THE COMMISSION 
in its Communication, in order to ensure a phased and progressive implementation of the 
objectives set out, based on the framework of existing Community measures. 
RFOUFSTS Tl IF ( OMMISSION TO REPORT TO THE COUNCIL AND THE 
PARLIAMENT: 
on the progress made with regard to the implementation and effects of the above measures 
before the end of IW4. 
/ ?S 
ANNEX 2 
UST OF CONTRIBUTORS 
(BOTH WRITTEN AND ORAL COMMENTS) 
TO THE 1992 TELECOMMUNICATIONS SERVICES REVIEW 
ANNEX 2 
PARTICIPANTS AT THE HEARINGS ON 
THE 1992 TELECOMMUNICATIONS SERVICES REVIEW 
Round Table for the Chairmen of Operators 
Administration P&T (Luxembourg) 
Belgacom 
BT 
Companhia Portuguesa Radio Marconi 
Deutsche Bundespost TELEKOM 
France Telecom 
Mercury Communications 
OTE 
PTT Nederland 
STET 
Telecom Eireann 
Telecom Portugal 
Tele Denmark 
Telefones de Lisboa e Porto 
Telefonica de Espaha 
Hearing for Users of Telecommunications Services 
American Chamber of Commerce In Belgium 
American Express Europe 
Association Française des Utilisateurs du Téléphone et des Télécommunications 
Bureau Européen des Unions de Consommateurs 
CALL (France) 
Club Informatique des Grandes Entreprises Françaises (CIGREF) 
Confederation of European Computer Users Associations 
Danish Shippers Council 
Daten Zentrale Schleswig-Holstein 
Deutsche Bundesbahn 
Du Pont de Nennours 
European Council of Telecommunications Users Associations 
European Information Industry Association (Luxembourg) 
Eurocontrol (Belgium) 
Eutelis T.M.C. (Belgium) 
GE Technical Se;rvices (the Netherlands) 
IBM Europe 
ICI pic (UK) 
International Cflamber of Commmerce (France) 
INTUG Europe 
N.V. Nederlanel.se Gasunie 
Shell International (UK) 
Telecommunications Users Association (UK) 
Telecom Managers Association (UK) 
Time Warner Europe (Belgium) 
t,y-
ANNEX 2: - page 3 
UNIOI. 
Ve>IK:.w.ie|en ((ietm.iny) 
Hearing for Telecommunications Service Providers 
AID (France) 
Ame;rit:an Chamber e>l Commerce in Belgium 
Cable? anel Wireless pie (UK) 
Dansk MohilTclcfon 
Eloctracom (UK) 
ENEL spa (Italy) 
Esat (Ireland) 
Euro|X)an Telecommunications Services Association (ETSA) 
Eutelsat 
Federation des constructeurs et installateurs agrées d'équipements téléphoniques (Belgium) 
Gaz de France 
HIT Rail (tlieî Netherlands) 
IBM (Germany) 
INFONET 
Inmarsat 
NYNEX (US) 
ONP-CCP 
Pacific Telesis International (US) 
Reuters (UK) 
SITA (France) 
Société française de Radiotéléphone 
Société Nationale des Chemins de Fer Français 
Sonofon (Denmark) 
Hearing for Manufacturers of Telecommunications Equipment 
Alcatel (Spain) 
Alcatel Bell (Belgium) 
Alcatel Network Systems (Belgium) 
Alcatel Alsthom (France) 
ANIE (Italy) 
ANIE (Spain) 
Ascom (Switzerland) 
ATEA (Belgium) 
AT&T-MSI (Hie Netherlands) 
Danish Electronics Industry Association 
Digital Equipment (France) 
Digital Equipment! (Germany) 
ECTEL 
EEA(UK) 
Ericsson (Sweden) 
Eurobit 
Fabrimetal (Belgium) 
GPT (UK) 
IBM (Belgium) 
IBM (Germany) 
ICL Europe 
IT Round Table; 
ll.illel (Italy) 
Metelcom (tlie; NtMhcrlanels) 
ANNEX 2: - page 4 
Nokia 1 ('IccdininiiMic.liions (I inland) 
Noilhetn leleeexn i ijrc>(><? (Canaela) 
Philips (the; Netherlands) 
SitMiieMis AG (Germany) 
Syndicat de?s intlusthtîs de télécommunications (France) 
Hearing for the Trade Unions in the Telecommunications Sector 
Luroledop CVCC (Belgium) 
CGSP Telecom (Belgium) 
DTF (Denmark) 
CFDT (PTT) (France)) 
CGT (PTT) (France) 
Communicatiejris Workers Union (Ireland) 
FCTA/CGTP (Portugal) 
SINDETELCO (Portugal) 
CCOO FETCOMAR (Spain) 
UGT FETTC (Spain) 
Ptist, Telegrapfi and Telephone International (Switzerland) 
STE (UK) 
NCU (UK) 
The trade unions above, together with the trade unions listed below, also presented their position 
prior to the hearing at the meeting of the Joint Committee on Telecommunications on 21 January 
1993. 
FSPTT-FO (France) 
OME-OTE (Greece) 
Deutsche Postgewerkschaft (Germany) 
Eurofedop (Germany) 
FILPT (Italy) 
UlL/telecommunicazioni (Italy) 
Abvakabo (the Netherlands) 
KPN (the? Netherlands) 
WRITTEN CONTRIBUTIONS 
ON THE 1992 TELECOMMUNICATIONS SERVICES REVIEW 
Alliance Internatitinale ele la Distribution par Câble (France) 
American Chamber of Commerce in Belgium 
Auuîrican Chamber of Commerce in Germany 
Anteîleipe» Consulting (UK) 
Asociack'in Espaiiola de? Usuarios de Tekîcomunicaciones (Spain) 
Asseiciation Française de?s Utilisateurs du Téléphone et des Télécommunications 
Association of British Insurers (UK) 
Associazione Na/ionale? Utenti Italiani di Tt;lecomunicazioni (ANUIT) 
AT&T (USA) 
Bekjacom 
British Pe?tre)le?um (UK) 
BT 
BTG Nederlandse Vereniging van Bedrijfstclccommunicatie Grootgebruikers 
Bure?au EuroptM?n ele?s Unions tie Consommateurs (BEUC) 
^ 
ANNEX 2: - page 5 
IIVB Bune t< ".vet battel Itutei tinel Intetniiatioiis 
Système? e' V ((îeMin.iny) 
Cable? aiHlWirek'ss pic (IIK) 
Club fnft>rmati(|iie? eles GraïKle?:; Entmpriscs Françaises (CIGREF) - (France) 
Ceinseil National élu Patronat Français 
Compagnie? Ge?ne?rafe?<le?s Eaux (France?) 
Confe?de?ration e>f Danisli lrulustrie?s 
Ceinsumers in the? European Community Group (UK) 
CPR Marconi (Portugal) 
Dansk Datafe>re?riing (De?nmark) 
Dunmarks Re?ele?rifore?ning (Danish Shipowners Association) 
Deîutsehe Bundespost Teltîkom 
De?ulscher industrie und Handlungstag 
Dtîutsche Telekom e.V. 
ECTEL - The European Telecommunications and Professional Electronics Industry 
ECTUA - European Council of Telecommunications User Associations 
Electronic Data Systems (EDS) (UK) 
Engineering Electronics Association (UK) 
EFTA Experts 
Electracom (UK) 
Esat (Ireland) 
ETNO - European Telecommunications Network Operators General Assembly 
Erhvervenes Transportudvalg (Danish Shippers' Council) 
Eurobit - European Assejciatiori of Manufacturers of Business Machines and Information 
Technology Industry 
Fédération des constructeurs et installateurs agréés d'équipements téléphoniques (Belgium) 
Finansradet ((Danish Bankers Association) 
France Telecom 
Gesamtverband der Deutschen Versicherungswirtschaft 
GE Technical Services (the Netherlands) 
Hermes Europe (the Netherlands) 
International Chamber of Commerce (France) 
International Chamber of Commerce, United Kingdom Committee on Computing, 
Telecommunications and Information Policy 
INTUG Europe 
Information Technology Industry Round Table 
Kingston ComiiHinicatkHts (UK) 
Kontor & Data (Association of Office and Computer Equipment) (Denmark) 
Landbrugsraadet (Agricultural Council of Denmark) 
Lloyds of London (UK) 
Colin Long (UK) 
Luxembourg Administration Postes et Telecommunications 
Mercury Communicatkms (UK) 
NetCom GSM (Norway) 
Neirtliern-Telecom (Canada) 
ONP CCP 
OTE 
Pae:rfic Tok?sis kitcîrnational (US) 
PTT Nede?dand 
Reuters (UK) 
Syndicat de?s Fabricants de Matériels Informatiques et Bureautiques (SFIB) (France) 
Sockîté Française du R;idiotéléphoiie (SFR) 
SITA (France?) 
Soe;iété Natkinale? de Chemin de Fer Français (France) 
STET 
Sprint Intcrnatieinal (UK) 
Telecommunications Users Association (UK) 
Telecom Eireann 
-) -
ANNEX 2:-page 6 
I ch'com PotltKi.il 
le-le Denmatk 
Ie>letonesele> I r.lm.i c Pente) (Il P) 
iele?le")nie:a ele> I spana 
Ihe? Oil Inefustty Intern.itional Lx|)lt)ialie)ii & Pioeiuctiein Forum (UK) 
UNICE 
Unilever pie; (UK) 
US Council feir lnte?matie>nal Business (US) 
US West (USA) 
Vere?niginej van Exploitation e;n Machtiginghouders 
Ve)lkswage?n 
S n 
ISSN 0254-1475 
COM(93) 159 final 
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