WRITTEN QUESTION E-1227/00

by Jaime Valdivielso de Cué (PPE-DE) to the Commission

(14 April 2000)

Subject: Competition

In recent months the various European telecommunications companies have been battling over the telecommunications market in Europe, particularly with a view to securing as many UMT licences as possible in the various Member States and to establishing themselves firmly on the market.

In the light of what happened in the case of first-generation mobile telephony (frequent abuses resulting from dominant positions, which adversely affected consumers), what action is the Commission intending to take in order to prevent a monopolistic or oligopolistic situation from arising and to avoid any further erosion of consumers' rights?

Answer given by Mr Monti on behalf of the Commission

(15 June 2000)

The Commission is following closely the attribution of third generation (3G) licences including the universal mobile telecommunications system (UMTS) to telecommunications operators in the Member States. Those processes have to comply with the obligations resulting from Directive 97/13/EC of the Parliament and of the Council on a common framework for general authorisations and individual licences in the field of telecommunications services(1), Commission Directive 96/2/EC of 16 January 1996 amending Directive 90/388/EEC with regard to mobile and personal communications(2), Decision No 128/1999/EC of the Parliament and of the Council of 14 December 1998 on the co-ordinated introduction of a third-generation mobile and wireless communications system (UMTS) in the Community(3) and the principles of Community competition law. In particular, attribution of licences will have to be transparent, fair, and non-discriminatory.

The fact that, in each Member State, the provision of mobile telephony services (under special mobile group (GSM)900, GSM1800 or 3G/UMTS standards) is or will be limited to a restricted number of companies results from the limited spectrum of radio-frequencies available for operating those services. In most Member States, mobile telephony services are offered by at least two and, generally, between three and five companies.

Both the Commission and the national competition and regulatory authorities monitor the competitive conditions of the markets related to mobile telephony services. At national level, competition authorities have started proceedings in a number of Member States and imposed fines on mobile operators because of collusive behaviour in their respective territories (e.g. in Italy, case Telecom Italia mobile (TIM)-Omnitel, regarding collusion on the level of tariffs for termination of calls on the mobile networks).

In February 1998, the Commission started an inquiry initially involving 45 operators in the 15 Member States to examine possible distortions of market conditions related to the provision of mobile telephony services. The Community-wide investigation was closed in May 1999, following an assessment of the substantial price reductions, up to more than 80 % in some cases, which have taken place since the investigation began. In conducting the inquiry, the Commission co-operated closely with national competition and regulatory authorities in the Member States.

In February 2000, the Commission launched a sector inquiry under Community competition rules concerning the conditions and pricing of national and international mobile roaming. Almost 200 formal requests for information were sent out simultaneously Community-wide to national competition authorities and telecommunications regulators, as well as to mobile network operators and service providers. Mobile roaming is the second of three telecommunications areas that are currently under investigation as part of a general telecommunications inquiry under the competition rules. The Commission expects to draw initial conclusions from this investigation before August 2000.

Moreover, in January 2000 the Commission sent administrative letters to the Member States in order to obtain information on the measures which they have taken in order to ensure that national legislation is in conformity with Decision No 128/1999/EC. This includes looking into the relevant legislation in particular with regard to selection procedures for licences to provide 3G services, measures taken to promote competition in the market and measures taken to ensure coverage of regions with low population density.

According to the information available to the Commission, Member States which have adopted 3G licensing procedures have prohibited multiple licence applications by single operators or by groups of operators. On the other hand, the fact that individual operators or groups seek to obtain licences in a large number of Member States is not objectionable as such, as it may contribute to the further integration of the European mobile market and the improvement of services to European consumers. Surveillance against abuses of dominant position will continue to be enforced in accordance with Community competition rules, and taking into account the interests of consumers.

(1) OJ L 117, 7.5.1997.

(2) OJ L 20, 26.1.1996.

(3) OJ L 17, 22.1.1999.