WRITTEN QUESTION E-2560/96 by W.G. van Velzen (PPE) to the Commission (11 October 1996)

Subject: Tariffs in the telecommunications sector

An investigation by the International Telecommunications Users' Group (INTUG) into the costs of telephone calls was recently published. It shows that on a five-minute long-distance call spanning the same number of kilometres the difference between national and international charges can be enormous. In the Netherlands, for example, it runs to no less than 454%. At the same time studies by the ONP working party have shown that the cost of national leased lines in major EU Member States is on average nearly 3 times as high as a leased line to a border. Investigations have also shown that countries with relatively low internal leased line tariffs nevertheless apply relatively high external tariffs.

Leased lines are of fundamental importance to a competitive telecommunications market and excessive tariffs prevent the development of a genuinely harmonized European market and damage the development of the information society. I therefore ask:

1. Is the Commission aware of the results of these investigations?

2. Can the Commission explain why there are still such enormous price discrepancies within the EU?

3. What action will the Commission take in the light of ONP leased lines Directive 92/44 ((OJ L 165, 19.6.1992, p. 27.)) and other telecommunications directives before the various reviews of directives now taking place have been concluded?

Answer given by Mr Bangemann on behalf of the Commission (13 November 1996)

The Commission is aware that, despite the adoption of a number of legislative measures designed to liberalise and harmonise the telecommunications sector throughout the Community (and, in particular, in spite of the open network provision (ONP) requirement for prices to be cost-oriented), price levels vary considerably between Member States, and according to the different kinds of service.

In general, the progressive opening up to competition of the telecommunications sector, coupled with technological progress, is bringing down prices. Following the political decision in favour of the liberalisation of the sector, an overall process of tariff rebalancing is under way in all European countries, though at very different rates, to align prices towards cost. However, in areas where there is still little competition, prices have not been substantially modified, and significant discrepancies exist between Member States.

In exercising its power to control the application of Community legislation, the Commission is monitoring the situation in Member States, and has already started infringement proceedings against a number of Member States for inadequate implementation of the ONP provisions, with special reference to the ONP leased lines directive ((Council Directive 92/44/EEC of 5 June 1992 on the application of open network provision to leased lines - OJ L 165, 19.6.1992. )).

On the other hand, the Commission considers that, after the liberalisation of alternative infrastructures as of 1 July 1996, the problem of excessive tariffs charged for leased lines, as raised by the question, should be significantly alleviated, in that incumbent operators are increasingly forced to adjust their tariffs under the threat of competitors charging lower prices.