2.2.94 OfficialJournaloftheEuropeanCommunities NoC34/35
OpinionontheCommunication totheCouncilandEuropeanParliamentontheConsultation
ontheReviewoftheSituationintheTelecommunications ServicesSectorreferringalsoto
the1992ReviewoftheSituationintheTelecommunications ServicesSector(Communication
bytheCommission )
(94/C34/12)
On27April1993theBureauoftheEconomicandSocialCommittee,actingunderthethird
paragraphofArticle20oftheRulesofProcedure,decidedtodrawupanOpiniononthe
abovementioned communications .
ThisOpinionsupplementstheCommittee'sOpinion(!)ontheCommunication fromthe
CommissionontheEuropeantelecommunications equipmentindustry:thestateofplay,
issuesatstakeandproposalsforaction[SEC(92)1049final].
TheSectionforIndustry,Commerce,CraftsandServices,whichwasresponsibleforpreparing
theCommittee'sworkonthesubject,adopteditsOpinionon3November .TheRapporteur
wasMrFlum.
Atits310thPlenarySession(meetingof24November1993),theEconomicandSocial
CommitteeadoptedthefollowingOpinionunanimously .
1.Background 2.SummaryoftheCommissionCommunication
2.1.TheCommunication of21October1992
(SEC(92)1048final)reviewstechnicalandeconomic
developments ,ECtelecommunications policytodate
andtheinternational situationinthissector.
2.2.Anassessmentofthecurrentsituationpoints
upthepositiveresults,butalsothedifficultiesand
bottlenecksinimplementingtheearlierregulationswith
regardtotariffs,trafficdiversion,delaysintheoffering
ofnewnetworksandservices,etc.
2.3.Fourproposals (options)areputforwardas
objectivesspecifictotelecommunications ,alongwith
somecomplementary actions.
2.4.Finally,theCommissionproposedproceeding
toabroadconsultationwithalltheinterestedparties,
givingthemachancetoairtheirviewspriortoafinal
Councildecisiononfutureaction.1.1.WiththeadoptionofitsCommunication '1992
ReviewoftheSituationintheTelecommunications
ServicesSector'of21,10.1992 [SEC(92)1048final],the
Commissionlaunchedawide-rangingdebateaboutthe
developmentofthetelecommunications sectorinthe
EuropeanCommunity .
1.2.Thepurposeofthisreviewandtheproposalsit
containsistoinitiatefurtherprogresstowardsthe
completeliberalizationofthepublictelecommuni­
cationsservicewithintheEuropeanCommunity .
1.3.Thestartingpointisthe1987GreenPaperon
theDevelopmentoftheCommonMarketforTelecom­
municationsServicesandEquipment (2).Sincethenthe
Commission'spolicyhasbeentobringaboutthesingle
internalmarketfortelecommunications services
throughliberalizationandharmonization .
1.4.Article10ofDirective90/388/EECof28June
1990oncompetitioninthemarketfortelecommuni­
cationsservices(3)statesthatduring1992theCom­
mission'willcarryoutanoverallassessmentofthe
situationinthetelecommunications sectorinrelation
totheaimsofthisDirective'.
1.5.Onthebasisofstudiesandanalysesofthe
prospectsforthetelecommunications sectoruptothe
year2010,thereviewpinpointsthevariousopportuniti­
esforfurtherliberalization .Besidesthemainreview,
fouroptionsforfutureactionareproposedinaseparate
section.3.SummaryoftheCommunication totheCounciland
theEuropeanParliament
3.1.Theresultsoftheconsultationprocesssetin
motionbyCommissionCommunication SEC(92)1048
finalwerepublishedinCommissionCommunication
COM(93)159final,whichalsocontainedtheDraft
CouncilResolution .
(')OJNoC161,14.6.1993,p.20.
(2)COM(87)290fin,30.6.1987.
(3)OJNoL192,24.7.1990,p.10.3.2.ThisCommunication containsbothanassess­
mentoftheconsultationprocessandthemost

NoC34/36 OfficialJournaloftheEuropeanCommunities 2.2,94
importantpointsraisedinthecommentsreceived.The
positionstakenontheproposedoptionsarealsosum­
marized.frameworksinordertopromotethedevelopment
ofnetworksanduniversalserviceintheperipheral
regions;
—theCommissioniscalledupontotakeaccountof
theparticularsituationregardingsmallnetworks
whenpreparingmeasurestoimplementtheobjec­
tivessetoutintheResolution .
4.3.Thefollowingmajorobjectivesinthelongterm3.3.InanevaluationtheCommission setsoutsthe
generalpositionsonfuturedevelopment ,theaction
requiredforthefutureregulatoryenvironmentanda
scheduleforimplementation instages.
3.4.TheDraftCouncilResolutionputforwardby
theCommissiondrawsconclusionsandspecifiesthe
mainobjectivesandtargetdates.werealsospecified:
4.TheCouncilResolutiononthereviewofthesitu­
ationofthetelecommunications sectorandtheneed
forfurtherdevelopmentinthatmarket
4.1.Atitsmeetingon16June1993theCouncilof
Ministersadopted,onthebasisoftheCommission
proposal,aResolutionsettingoutthekeyaspectsof
futureregulatorypolicyandthemainshort-andlong­
termobjectives.
4.2.Thefollowingmajorgoalsintheshortterm
werespecified:—theliberalizationofallpublicvoicetelephonyser­
vices,whilstmaintainingauniversalservice;
-—maintainingabalancebetweenliberalization and
harmonization inagrowingmarket;
—theexaminationofprogressmadeinstructural
adjustmentpriortothefullliberalizationofall
publicvoicetelephonyservices,inparticularthe
adjustmentoftariffsinthosecountrieswhichhave
particulardifficultiesintakingaccountofthesitu­
ationinperipheralregionswithlessdevelopednet­
works,andtheestablishment ofadditionaltran­
sitionalperiods;
—theformulationofafuturepolicyfortelecommuni­
cationsinfrastructure basedontheresultsofwide­
rangingconsultationfollowingpublicationofthe
GreenPaperoninfrastructure .
4.4.TheCouncilalsocallsontheMemberStates:
—topromotetheprogressiveapproximation oftariffs
towardscost-orientation ,togetherwiththecontinu­
ingdevelopmentofuniversalserviceforallusersat
reasonablepricesand
—toprovideforallthenecessaryfinancial,organiza­
tionalandmanagementindependenceofTOsin
ordertoallowthemtoprepareforthecompetitive
environment .—theadoptionoflegislativeproposalsregardingthe
introductionofOpenNetworkProvision (ONP)
andsatellites,togetherwiththerapidandeffective
applicationoftheexistingCommunitylegislationin
thefieldoftelecommunications servicesandONP;
—theimplementation and,wherenecessary,therecog­
nitionofONPprinciplesintheECinrespectof
futureliberalization andissuessuchasuniversal
service,theinterconnection ofnetworksandaccess
chargesandmattersrelatingtolicensingconditions;
—thedevelopmentoffutureCommunitypolicyinthe
fieldofmobileandpersonalcommunications ;the
forthcomingpublicationofaGreenPaperonmobile
communications willhelptoachievethisaim;
—thedevelopmentoffutureCommunitypolicyinthe
fieldoftelecommunications infrastructure andcable
TVnetworks;theforthcomingpublicationofa
GreenPaperonthismatterwillhelptoachievethis
aim;
-—theformulationofappropriatemeasurestotackle
specificproblemsaffectingperipheralregionsand
lessdevelopednetworks.Suchmeasuresshould
complementnationalfundingandshouldtake
advantage,whereappropriateandprovidedthatthe
prioritiesareobserved,ofCommunitysupport4.5.TheCommitteesupportsthefollowingtarget
datesproposedbytheCommission :
a)thepublicationofaGreenPaperonmobilecom­
municationby1January1994;
b)thepublicationofaGreenPaperonthefuture
oftelecommunications infrastructure andcableTV
networksby1January1995;
c)tomakethenecessarychangestoframeworkpro­
visionsintheCommunityby1January1996in
ordertoenabletheliberalizationofallpublicvoice
telephonyservicestobeachievedby1January1998; (')OJNoC213,6.8.1993,p.1.

2.2.94 OfficialJournaloftheEuropeanCommunities NoC34/37
d)measuresaretobetakentoenableMemberStates
withlessdevelopednetworkstocarryoutthe
necessarystructuraladjustments,aboveallwith
regardtotariffs;anadditionaltransitionalperiod
ofupto5yearsistobegranted;
e)theCommission isalsorequestedtoreport,bythe
endof1994,ontheprogressmadeinintroducing
themeasuressetoutintheResolutionandontheir
impact;itisfurtheraskedtoreportbytheendof
1993onaframeworkforECtelecommunications
policywhichwouldbereadilyunderstoodthrough­
outtheworld.5.7.TheCommitteeiscriticalofthefactthatina
consultationprocesswhichhaslastedsinceOctober
andinwhichmorethan130organizations havebeen
abletoairtheirviews,theCommitteewasexcluded
andnotaskedbytheCommissiontoissueanOpinion
onthesefar-reachingchangesinthetelecommuni­
cationssector.Asthesedecisionshavemajoreconomic
andsocialimplicationsfortheMemberStates,the
Committeehasthereforedecidedtotaketheoppor­
tunitypresentedbytheCommission'sCommunication
of28April1993toissuethisAdditionalOpinionon
itsowninitiative.Ithopesthatitwillbetakeninto
consideration bytheCommission inallfurther
measuresconcerningthismatter.TheESCcallsupon
theCommissiontoinformitinfutureingoodtime
abouttheprogressmadetowardsimplementingsuch
measures .5.GeneralcommentsontheCommission Communi­
cationandtheCouncilResolution
6.Specificcomments
6.1.TheCommitteefeelsthatthesespecificcom­
mentsshouldconcentratelessontheassessmentofthe
situationintheCommissionCommunication ,andmore
onthesubsequentCouncilResolutionof22July1993
andtheconclusionsitcontainsconcerningfutureCom­
munitypolicy.5.1.EssentiallytheCommitteewelcomestheCom­
missionproposalandtheCouncilResolution.Itsinten­
tioninputtingforwardthefollowingcommentsis
primarilytoassistinthepreparationoftheGreen
Papersreferredtoinpoint4.5.
5.2.TheCommitteenotesthat,inaccordancewith
Directive90/388/EECof28June1990,theCommission
Communication containsanoverallassessmentofthe
Communitytelecommunications marketsandconsiders
whetherexclusiveandspecialrightsarestillcompatible
withCommunitylaw.TheCommitteeagreeswiththe
conclusionsetoutinthedocumentthattechnological
developmentandthedevelopmentofthemarketare
boundtoleadtotheliberalization oftelecommuni­
cationsservices.6.2.TheCommitteeendorsestheeffortsmadeby
theCommissiontobringaboutrapidadoptionand
implementation oftheDirectivesonONPvoicetele­
phoneservices,recognitionoflicencesandregulation
ofmobileandsatellitecommunications .Withoutclear
anduniformrapidimplementation intheCommunity
itisdoubtfulwhethertheexpectedboosttothegrowth
ofCommunity-wide serviceswillbeachieved.
6.3.TheCommitteeconsidersthatthedifficulties
currentlystandinginthewayofimplementation of
existingregulationsintheindividualMemberStates
areparticularlysignificant.
6.4.IntheCommittee'sviewitisessentialthatEC
legislationbeimplementedinfullwithoutdelayinthe
MemberStates.5.3.TheCommitteedrawsattentiontothefactthat
theoverallbenefitstotheconsumer,industryandall
thoseinvolvedinbusinessactivityofawell-developed
telecommunications infrastructure andefficient,
advancedtelecommunications servicesareuniversally
recognized .
5.4.TheCommitteeendorsesthegeneralneedto
maintainfinancialstabilityinthesectorandtosupport
universalservice,butpointsoutthatthismustgo
handinhandwiththecontinuationofthenecessary
adjustmentstotariffstructures.
5.5.TheCommitteereiteratestheviewwhichithas
alreadystatedinitsOpinionsof26April1989onthe
ProposalforaCouncilDirectiveontheimplementation
ofOpenNetworkProvision(ONP)(90/387/EEC)and
25November1992ontheDirectiveonONPforvoice
telephoneservices[COM(92)247].
5.6.TheCommitteewelcomesthedeclarationofthe
CouncilandCommission ontheestablishment ofa
balancebetweenliberalization andharmonization of
legislationinagrowingmarket.6.5.TheCommitteeshouldbeconsultedonany
furtherstudiesandtheirresults,inparticularon
accountoftheeffectsontheemploymentsituationand
workertraining.
6.6.TheCommitteesupportsthecreationoftrans­
Europeannetworksandincreasedcooperationbetween
telecommunications organizations ,thuspromotingthe

NoC34/38 OfficialJournaloftheEuropeanCommunities 2.2.94
interconnection andinteroperability ofthenetworksto
besetup,asprovidedforintheMaastrichtTreaties.6.10.TheCommitteethinkstheopening-upofEC
telecommunications marketstothirdcountriesis
necessarytotheestablishmentofabalanced,fairinter­
nationalbusinessenvironment .Itis,however,vitally
importantthattheopening-upofthemarketisnota
one-waystreetandthatMemberStatesareallowed
parallelandnon-discriminatory accesstothetelecom­
municationsmarketsofthesecountries.6.7.TheCommitteesupportstheviewthat,because
oftheexistingdifferencesininfrastructures intheCom­
munity,aspeedysearchshouldnowbemadetofind
whatpossibilitiesthereareforprovidingcorporate
networksandclosedusergroupswithaccesstoalterna­
tiveinfrastructures .Inthelongerterm,widerinfrastruc­
turecompetitionshouldbestudied,e.g.intheformof
aGreenPaper,sothataclearCommunitypolicyon
telecommunications infrastructure canbedeveloped
andlaiddown.ThisincludesgreateruseofcableTV
networks .Itisalsoimportantthattheguaranteeofreciprocity
betweenECandnon-ECoperatorscoverthequestion
ofownershipinthewakeoftheprivatizationofpostal
andtelephoneservicesinmanyMemberStates.
6.11.Theinternational liberalization oftelecom­
municationsservicesshouldbedevelopedwithinthe
contextofageneralconclusionoftheUruguayRound
andanycontinuingnegotiationsontelecommuni­
cationsthereafter,onthebasisofanexactdefinition,
agreedatCommunitylevel,oftheframeworkforlib­
eralizationinordertoensuremutualunimpededaccess.TheCommitteenotesthatinitsResolutiontheCouncil
deviatesfromtheCommissionproposalinstipulating
afive-yeartransitionalperiod.Inprinciplethisistobe
welcomed,butshouldnotmeanthatithastobefully
used.Everyeffortshouldbemadetoachievetheobjec­
tivessetbytheCouncilasquicklyaspossible.
TheGreenPaperontelecommunications infrastructure
urgedbytheCouncilinitsResolutionshouldlaydown
unambiguousdefinitionsoftermssuchas'closeduser
groups'and'corporatenetworks'whichhavehitherto
beeninterpreteddifferentlyintheMemberStates.6.12.TheCommitteealsothinksthatthestandards
bodies—andinthiscontextETSI(EuropeanTelecom­
municationsStandardsInstitute)inparticular—must
ensurethatthestandardstheydrawupmeettherequire­
mentsoftheliberalizationprogramme ,aremarket­
orientedandrealisticincommercial termsandare
introducedingoodtimetoenablemanufacturers and
userstoplanahead.
6.13.TheCommitteestressestheimportance
attachedbytheCouncilandtheCommissiontothe
Communityhavingatelecommunications systemwhich
offersallusers,includingcertainsocialgroups,moder­
atetariffsforaccesstoanduseofhigh-qualityservices.
Suchasystemwillbebeneficialtoindividuals,commer­
cialusers,thecompetitiveness ofindustryandtheCom­
munity,andtotechnologicalprogress.6.8.Contrarytotheoptionsforfurtherregulation
discussedintheconsultation ,itisnowplannedto
liberalizeinfulltheentirevoicetelephonyserviceby1
January1998,whilemaintainingauniversalserviceno
longerreservedfortheTOs.TheCommitteeconsiders
thatevenbeforetheliberalization oftheentirevoice
telephonyservice,theprioritygoalshouldbetodefine
thescope,organizationandfinancingoftheuniversal
service.Itseemssensibletolaydowntransitionalper­
iodsforcountrieswhichhaveparticularproblems—
wherethisisjustified—andtakeaccountofthesitu­
ationofborderregionswithless-developed orsmall
networks.IntheCommittee'sviewtheMemberStates
shouldendeavourtoachievetheobjectivesbeforethe
endofthetransitionalperiodandinparticulartoavoid
theriskofamulti-speedEuropedeveloping .6.14.Inviewofthesubstantialchangestakingplace
rightnow,theCommitteeispleasedthattheschedule
andtheprogressmadeinrelationtothemeasures
containedthereinshouldbereviewedfromtimeto
time.Achangeinthepoliticalclimate,technological
advancesorchangesindemandcouldnecessitatea
correctiontothesemeasuresintheinterestsofmanufac­
turersandusersifobjectivesaretobemetspeedily.6.9.TheCommitteeendorsesthecallontheMember
Statestoprovideforthenecessaryfinancial,organiza­
tionalandmanagementindependenceofTOs—irres­
pectiveoftheirlegalformintheMemberStates—in
ordertoallowthemtoprepareforthecompetitive
environmentandtakenecessarymeasuresinthefields
oforganization ,staffplanningandrestructuring .6.15.Infutureusers,manufacturers ,operators,trade
unions,theEconomicandSocialCommitteeandthe
EuropeanParliamentshouldparticipateinappropriate

2.2.94 OfficialJournaloftheEuropeanCommunities NoC34/39
fashionintheconsultationsonthemainshort-andPapersarepublished,withaviewtoachievinga
long-termgoals,inparticularwhentheplannedGreenbroadly-based socialconsensus.
DoneatBrussels,24November1993,
TheChairman
oftheEconomicandSocialCommittee
SusanneTIEMANN
OpinionontheproposalforaCouncilDirectiveamendingDirective90/434/EECof23July
1990onthecommonsystemoftaxationapplicabletomergers,divisions,transfersofassets
andexchangesofsharesconcerningcompaniesofdifferentMemberStates(*)
(94/C34/13)
On12August1993theCouncildecidedtoconsulttheEconomicandSocialCommittee
underarticle100oftheTreatyestablishingtheEuropeanCommunityontheabovementioned
proposal.
TheSectionforEconomic,FinancialandMonetaryQuestions,whichwasresponsiblefor
preparingtheCommittee'sworkonthesubject,adopteditsOpinionon26October1993.
TheRapporteurwasMrR.Pelletier.
Atits310thPlenarySession(meetingof24November1993),theEconomicandSocial
CommitteeadoptedthefollowingOpinionunanimously .
1.TheproposedDirective thesecondmeasureconcernstheoptionofferedto
theMemberStatesbythe'mergers'Directiveto
derogatefromtheexemptionfromtaxationofany
capitalgainsaccruingtoanacquiringcompanyon
thecancellation,followingthemerger,ofitsholding
intheacquiredcompany.1.1.TheproposedDirectivecontainstwomeasures:
—Thepurposeofthefirstmeasureistoextendthe
commonsystemoftaxationapplicabletomergers
andsimilaroperationstoallcompaniesfromtwo
ormoreMemberStatessubjecttocorporationtax
inaMemberState,whatevertheirlegalform:the
formrequirementreferredtounderArticle3(a)of
Directive90/434/EECof23Julywouldtherefore
beabolished.Thiswouldmakethefollowing,in
particular,eligibleforthecommonsystemoftax­
ationapplicabletomergersandexchangesofshares:
cooperatives ,publicsavingsbanksandpartnerships
partiallysubjecttocorporationtaxorhavingopted
forimpositionofthistax.1.2.UnderArticle7(2)ofthe'mergers'Directivethis
derogationoptionapplieswheretheholdingdoesnot
exceed25%.Itisproposedthatinfuturethecriterion
shouldbethattheholdingmustconferthestatusof
parentcompanyunderthenationalprovisionsadopted
pursuanttoArticle3(l)(a)ofthe'parentcompanies'
Directive90/435/EECof23July1990:theMember
Statescouldderogatefromthecapitalgainsexemption
wheretheholdingsdonotconferthestatusofparent
companywithinthemeaningoftheirnationallawas
enacted,inaccordancewiththelatterDirective. HOJNoC225,20.8.1993,p.5.