WRITTEN QUESTION P-3773/98

by W.G. van Velzen (PPE) to the Commission

(4 December 1998)

Subject: Telecommunications and universal service

The European Bureau of Consumers' Unions (BEUC) has recently published a report entitled "Universal service in the telecommunications sector: European consumers" right to telecommunications services'. This study shows that many countries in the European Union have not done enough to compel telephone companies to provide an adequate universal service.

1. What is the Commission's view of the BEUC's findings?

2. What impact does this have on the definition of "universal service" as set out in Directive 97/33/EC of the European Parliament and of the Council of 30 June 1997(1)?

3. What does it mean with regard to the financing of universal service in the various Member States, and what conclusions will the Commission draw from this?

4. Pan-European numbers, including the European 112 emergency number, are also included under universal service. Have European rules in this area now been transposed in the national legislation of all Member States and, if not, what action does the Commission intend to take to achieve this objective?

Answer given by Mr Bangemann on behalf of the Commission

(11 January 1999)

1. The Commission welcomes the detailed and comprehensive report by the European bureau of consumer unions (BEUC) which states that BEUC and its related consumer organisations support liberalisation because they believe the long term effects will be beneficial, although they undertook the study because of concern about the immediate effects on consumers.

The report tackles a range of consumer and market issues, and in particular examines transposition of both the 1995 and the 1998 voice telephony directives(2). However, the 1995 Directive was designed for a monopoly environment and has been entirely replaced by the 1998 Directive, which is adapted for a competitive market. Whilst some consumer measures are strengthened or made more specific in the 1998 Directive, others, such as quality of service targets, are now at the discretion of the regulator. BEUC calls for more detail in Community law, whereas the current trend is towards competition providing the means to improve services and consumer choice, backed up by specific consumer protection measures. The Commission currently has 7 infringement cases open concerning this Directive.

On the issue of tariffs, the BEUC report examines changes between the beginning of 1995 and the beginning of 1997 (based on the tariff survey published by the Commission). The average tariff increase quoted (37 %) is the average nominal increase for (the highest published) rental charges in the 15 Member States and was due to very high nominal increases (over 100 %) in Greece, Luxembourg and Finland. The Commission's recent fourth implementation report(3) gives a more up to date picture on tariffs. It shows that the lowest residential telephone charges are in Denmark, Luxembourg, the Netherlands, Finland, Sweden and the United Kingdom, essentially the group of Member States which liberalised first (for Luxembourg, results are not immediately comparable because of the size of the Member State).

2. BEUC makes some specific suggestions for future change in the definition of universal service, such as specifying in the legislation a minimum bandwidth or rate for data transmission and integrating calling line identification in the universal service definition (provided the service is optional and consumers have the possibility to suppress calling line identification). The Commission will consider such issues in its review of the regulatory framework in 1999, based on the two year's experience of liberalised markets in most of the Community. In this context, it will address a range of consumer policy concerns as indicated in the Commission's recent consumer policy action plan 1999-2001(4).

3. There are no immediate consequences for the financing of universal service because this depends on the net cost (costs less revenues and other benefits) of provision. More widespread provision of low user and social schemes may raise net costs whilst tariff re-balancing and lowering of unit costs are likely to decrease them.

4. Concerning the common European emergency call number 112, this has now been implemented in all Member States apart from Greece. Infringement proceedings have been opened against Greece.

(1) OJ L 199, 26.7.1997, p. 32.

(2) OJ L 101, 1.4.1998 and OJ L 321, 30.12.1995.

(3) COM(98) 594.

(4) COM(98) 696.