Oireachtas Joint and Select Committees
Wednesday, 23 October 2013
Joint Oireachtas Committee on Transport and Communications
Scrutiny of EU Legislative Proposals
I welcome Ms Katherine Licken, Mr. Dave Hanley, Mr. Eugene Dillon and Mr. Aidan Ryan from the Department of Communications, Energy and Natural Resources and Mr. Kevin O'Brien and Mr. Bobby Hannon from the Commission of Communications Regulation, ComReg. They will enlighten us on the implications for Ireland of the adoption of COM (2013) 627 concerning the European single market for electronics communications.
By virtue of section 17(2)(l) of the Defamation Act 2009, witnesses are protected by absolute privilege in respect of their evidence to the committee. However, if they are directed by it to cease giving evidence on a particular matter and continue to do so, they are entitled thereafter only to qualified privilege in respect of their evidence. They are directed that only evidence connected with the subject matter of these proceedings is to be given and asked to respect the parliamentary practice to the effect that, where possible, they should not criticise or make charges against a person, persons or an entity by name or in such a way as to make him, her or it identifiable. I also advise witnesses that any submission or opening statement submitted to the committee will be published on its website after the meeting. Members are reminded of the long-standing parliamentary practice to the effect that they should not comment on, criticise or make charges against a person outside the Houses or an official either by name or in such a way as to make him or her identifiable.
I invite Ms Licken to make her opening remarks.
Ms Katherine Licken:
I thank the Chairman and members for the invitation to talk through the implications of the proposed regulation from the European Commission on a connected continent. The Commission and member states have been working for a number of years to achieve a digital single market, reducing barriers to cross-border trade and activities and aiming to make cross-border transactions as seamless as possible. A number of regulatory packages have been agreed as part of this ambition, including the most recent regulatory reform measures which were transposed into Irish law in 2011. It is also in this context that the digital agenda for Europe, DAE, is framed. This is one of the flagship initiatives under Europe 2020.
The Commission's connected continent initiative has been proposed as a further measure to achieve a move towards a single market for electronic communications. The ambition of this measure, as with other initiatives, is to achieve a market in which citizens and businesses can access electronic communications services wherever they are provided in the European Union without cross-border restrictions or unjustified additional costs and a market in which companies can provide electronic communications networks and services wherever they are established and wherever their customers are situated in the Union. The aim of the proposed regulation is to complete the single telecommunications market through action on a number of fronts. We have identified three aspects of the regulation: first, to enable operators to provide services across borders using networks in other member states through a single authorisation regime - this measure aims to ensure greater consistency and predictability in the content and implementation of the regulatory regime across the European Union; second, to co-ordinate the use of radio spectrum in the European Union, with a view to enabling better cross-border provision of wireless broadband communications; and, third, to harmonise rules on consumer protection. These include rules on non-discrimination, contractual conditions, switching and number portability, access to online content and traffic management, which is net neutrality. In addition, the proposal provides for further reforms on roaming charges.
The proposal has provoked a widespread and strong reaction across the full range of players in the EU telecommunications market. There appears to be a common consensus on the Commission's diagnosis of the challenges facing us in implementing the digital single market and the debate this has provoked is helpful. The policy, regulatory and technical issues that need to be addressed to achieve a seamless European market for digital products and services are, however, complex and challenging. For this reason, we need to proceed carefully with any new initiative and Ireland will press the Commission and the Council for detailed consideration and debate on the Commission's proposals. The Commission has acknowledged that this proposal represents "the most ambitious legislative measure in the sector for the past 26 years". We concur with this view and feel such a proposal requires a thorough and comprehensive analysis of all its various elements before the European Council and the Parliament can sign off on its various component parts.
In the past few weeks, since the Commission’s proposal was published in September, officials in the Department have met a number of stakeholders, including ComReg which is represented at this meeting and a number of telecommunications operators in the Irish market. We have also facilitated a meeting between the European Commission, the Department, ComReg, the Telecommunications Industry Federation and ALTO, the alternative operators in the communications market. A number of concerns have been raised by operators and regulators about the proposals. They include the appropriateness or need for some of the measures, their impact on the current regulatory framework and the implications, intended or otherwise, of implementing them. Ireland, in common with most other member states, will press for significant time to be given to this dossier to facilitate a more thorough scrutiny of the detail of the proposed regulation.
I refer to some of the more specific issues from Ireland’s perspective. With regard to spectrum, the Commission’s objective regarding this element of the proposal is to ensure co-ordinated and timely availability of new wireless technologies, to boost interoperability and to ensure economies of scale across Europe. To achieve this, the Commission proposes common principles for rights of use of harmonised spectrum for wireless broadband, synchronisation of spectrum availability, timing and duration of rights of use and new Commission powers to adopt implementing Acts setting criteria such as expiry, renewal, timing of assignments, duration and fees. It is, therefore, a one-size-fits-all approach.
Ireland, together with most other member states, sees the merit in closer harmonisation and we have experienced how harmonisation has been effective in the market, but we have expressed caution about the significant shift proposed in the balance of power between the Commission and national regulatory authorities and governments. The Commission has assured member states that the principle of subsidiarity is respected as EU intervention will be limited to the extent necessary to remove specified internal market barriers. However, there are provisions for increased powers for the Commission in matters which have up to this point been the responsibility of the national regulator. This is a significant change in the management of an area which is a valuable national strategic asset and, like other member states, Ireland feels the full implications of this proposal must be critically examined before proceeding further.
On the issue of net neutrality, the Commission’s proposal aims to ensure open access to the Internet for end-users. This is to be achieved by banning any blocking or throttling of services and-or applications, except in limited, objectively justified circumstances. It sets out clear rules for traffic management which has to be non-discriminatory, proportionate and transparent. Supervision will be by national regulators which may impose minimum quality requirements, under Commission co-ordination. Reaction from industry has been negative thus far and ComReg has also expressed concerns. From a Government viewpoint, we need to consider this matter in more detail. The provisions of the current regulatory framework provide a flexible and workable means of dealing with this matter and we need to ensure new measures are proportionate and workable, while respecting the fundamental principle of net neutrality.
Roaming is an issue of interest to all citizens and we can all identify with it. The draft regulation contains radical proposals in terms of abolishing roaming charges. These charges have been one of the more visible manifestations of a fragmented European market and the European Union has made much progress to reduce them. The Commission wants to accelerate this process with a view to abolishing roaming altogether. We can all support this initiative, but we do need to exercise caution in implementing new measures. Specifically, we have asked the Commission to consider a potential conflict between the proposed new measure and the existing roaming regulation which requires industry to reduce roaming charges further by next July. That regulation requires industry to make significant investments to meet the decoupling obligations by next July. At the same time, the new draft proposal may make these investments redundant.
At a time when we are pushing operators to invest in improved connectivity, we need to be careful about conflicting investment signals. The Commission’s proposals on consumer protection are designed to ensure the right to plain-language contracts and greater rights to switch provider, among other measures. We believe that these proposals are welcome, although national regulators may question the proportionality of some proposals. It will be important to clarify the relationship between some of the measures proposed and existing measures applicable to universal service providers.
The Commission is proposing to upgrade the minimum harmonisation provisions adopted in 2009, which were implemented by Ireland in 2011, to a “fully harmonised” mandatory framework. This will, in effect, prohibit national governments and national regulatory authorities, NRAs, from maintaining or introducing any additional consumer protection provisions beyond what is in this proposal. While there are obvious merits to the one-size-fits-all approach, we need to be careful that member states and NRAs are not deprived of the ability to respond to the changing needs of their respective markets and national consumers. Importantly, we may need to avoid having to step back from measures already in force, thereby reducing rather than enhancing consumer protection.
On the single authorisation mechanism, the Commission is proposing that service providers operating in more than one member state will benefit from a single EU authorisation requiring only one notification - that would be in its home member state. The Commission argues that this will simplify regulation and improve convergence of regulatory conditions. It introduces the concepts of home and host member states. It is unclear precisely what problem the Commission is seeking to address here. The industry is lukewarm on the proposal and national regulators, including the European regulatory umbrella body, BEREC - Body of European Regulators of Electronic Communications - are very strongly opposed. ComReg can perhaps provide more detail about its concerns for the Irish market.
Ireland remains strongly supportive of the principle and objective of a digital single market. While radical, the proposal up for discussion this morning is only a small part of the overall Single Market objective. Issues such as cyber-security, electronic signatures and trust services, copyright and data protection are still being negotiated at Council. Ireland continues to play a constructive role in helping progress these important files. While we welcome the longer-term vision that the single telecommunications market, STM, regulation seeks to achieve, we will be seeking to ensure that this radical proposal is afforded the requisite time to allow for a detailed and comprehensive analysis of the consequences and impacts of its implementation. It is a regulation which of course means direct applicability and also contains provisions for the Commission to adopt implementing Acts. This will allow it to introduce legally enforceable measures in the future in areas that were heretofore within our national competence. There is therefore a very significant shift in power in some policy areas from member states' NRAs to the Commission, and we need to examine this carefully.
We are also concerned about ensuring that the proposal does not lead to unnecessary regulatory uncertainty. We share the Commission’s view that lack of investment is a key challenge facing Europe’s telecommunications market, but we need to ensure that any new measures boost investment and provide the requisite regulatory certainty for market operators.
Finally, we will be asking our Commission and member state colleagues to consider the market implications of this proposal. Member states have expressed some concern that the proposed legislation will lead to market consolidation, with a small number of powerful players dominating the European market. While this undoubtedly has some benefits, we need to ensure that small peripheral countries such as Ireland are not disadvantaged as a consequence. It is often the case that the smaller players provide niche services in markets that are not served by bigger players, and bring important competitive tension into the market. The long-term interest of consumers continues to be the development of cost-effective, transparent and high-quality services. In our negotiations on this proposal we will continue to stress this important goal, with a view to ensuring a balanced and progressive outcome. We would be happy to deal with any questions.
Mr. Kevin O'Brien:
Thank you, Chairman, for providing ComReg with the opportunity to present our views on the changes proposed by the European Commission to the regulatory framework for electronic communications. I am accompanied today by my colleague Mr. Bobby Hannon, international manager at ComReg.
European and Irish consumers and end-users have benefited greatly from the advances in electronic communications services and the networks on which they and other services depend. Innovative services have been developed and prices reduced due, among other elements, to a practical, evidence-based approach to regulation. Regulation of the sector has been defined at European level through a series of related directives, the practical implementation of which has been entrusted to decisions at national level - that is, giving effect to the principles of subsidiarity. The Commission is now proposing a radical departure from that approach. ComReg, in our own right, and as a member of BEREC, has concerns about the potential impact of the set of proposals on the future effectiveness of regulation, particularly at national level. In proposing a regulation instead of a directive, the Commission is removing the possibility of national governments or NRAs tailoring the rules to meet the unique needs of local markets. Our specific concerns relate to the practicality of what is being proposed and whether changes will bring about the desired outcome. More particularly, will the needs of the Irish marketplace be met by a one-size-fits-all approach, as advocated by the Commission?
I reiterate the concerns which BEREC identified in its initial statement following publication of the proposals. I have provided copies of the BEREC statement to members. The proposals would represent a fundamental shift of decision-making away from national level and centralise competencies at Community level with increased powers for the European Commission. In doing so there is a risk to the ability of national regulators, whether acting individually or collectively through BEREC, to take appropriate and proportionate regulatory action in all the relevant markets. Finally, by proposing such a radical departure from the current framework, the Commission risks undermining legal certainty, in contrast to its own stated objectives of creating a predictable regulatory environment, which is essential to the promotion of efficient investment and effective competition.
I do not wish to portray all of what is proposed by the European Commission as negative. There are aspects which we consider to be progressive and, with further development, would be of benefit to Irish consumers. Commissioner Kroes in recent days described the proposals as “sweet and sour” and as a package that cannot be taken apart. Staying with the Commissioner's analogy, there are features of what is proposed that, while we could not give them an unqualified endorsement, are certainly more sweet than sour. I include in this category the measures proposed on end-users' rights. For the most part, these amount to an upgrading of existing provisions in the directive from enabling measures to mandatory provisions. In Ireland we have chosen to have such rules in place, but other countries have not done so or have not done so to the same extent. There are some aspects that we think are disproportionate, but we would expect them to be addressed when the Council of Ministers and the European Parliament consider the proposals.
There are also new provisions - for instance, on switching service providers and on the treatment of bundles - which, again, subject to some further work, we think would benefit consumers, particularly as services are being increasingly subscribed to through bundles. The provisions on net neutrality are also generally positive but we are not convinced that this can represent the final word on the issue. We are acutely aware that the debate surrounding assured service quality and traffic management can raise issues about discriminatory preference being given to certain applications or, indeed, to certain categories of user. We would expect this aspect of the proposals to generate a lot of debate.
Overall, we have our doubts that the end-user provision, including net neutrality, should be addressed by way of full harmonisation - that is, by way of a regulation rather than an amending directive. While this should result in end-users having the same experience anywhere in the EU, we are concerned at the prospect, over time, of our being unable to react at national level to consumer protection issues which may be unique to Ireland. In fact, we have specific concerns that consumer protection measures which ComReg has introduced, such as requirements on the format of bills and on advance notice by operators exiting the market, would no longer be permitted. Our preference would be for the EU legislation to specify a minimum, not a maximum, set of harmonised consumer rules and for member states to supplement these where necessary and where proportionate.
The proposal also amends the roaming regulation, the most important aspect being a mechanism for operators to offer a roam-like-at-home facility as an alternative to the requirement due to come into effect next July of a facility to allow customers take roaming services from a different operator. We will support any mechanism that drives down the cost of roaming for Irish users but the practicality of the particular mechanism needs to be carefully considered, along with the implications for mobile providers who are not part of a pan-European alliance.
There is a proposal that would place a cap on the cost of a call from Ireland to anywhere in the Union. Again we support reductions in unjustified costs incurred by end users but the mechanism proposed by the Commission proposes very different approaches for mobile and fixed networks.
Let me turn to the aspects of the proposals that we would definitely consider sour. The first is the single EU authorisation. This is stated to reduce barriers to entry and simplify matters for operators that are active in more than one member state. The proposal introduces the concept of a home member state, which is where the operator is headquartered, and a host member state, where the operator, subsidiaries and affiliates provide services. There is no simplification of procedures for operators. One would still be required to notify details of each operating entity in each of the official languages in each of the territories in which one operates. The only difference is that a single notification would be made to the regulator in the home member state, who would then have to forward the information to each regulator in each other member state where the operator is active. Far from being a simplification, it would create unnecessary bureaucracy for operators and also for regulators while making the procedures more cumbersome and regulatory responses subject to delay.
By creating the concept of a European provider, the proposal would create a two-tier regulatory regime with the capacity for national regulators to regulate European providers in their national markets subject to veto by the EU Commission. Furthermore, it would make regulation of national markets subject to the views of the home regulator, thereby creating quite a different regulatory regime. Eircom and Vodafone, for instance, would be under a very different type of regulatory framework. Since 2011, there has been a procedure in place for the consistent application of remedies – the Article 7 procedure. This has worked well over the past 2.5 years since its introduction, yet the Commission is proposing to discard this and introduce an unproven and unjustified alternative procedure for European providers only.
The final and perhaps most important issue I want to address is that of spectrum. Essentially, decision-making in respect of assignment of spectrum would be vested in the Commission, and member states would have far less control. This is a fundamental shift in responsibility and I am confident in stating that we in ComReg would not have been able to conduct our recent spectrum auction, which has provided 4G services to the Irish public and has raised in excess of €850 million for the State, within the timescale in which we operated, nor would we have realised such a financial benefit for the Exchequer had these proposed measures been in place. There is a fundamental issue of subsidiarity and proportionality involved. Ireland’s national objectives and our intentions regarding spectrum use will inevitably be a low priority for the Commission, and a country of our size and population would probably be marginalised in any pan-European award process. The implications for future revenues of the allocation of what is a national resource cannot be overlooked. In ComReg’s view, the Commission should concentrate on implementing existing arrangements for co-ordination among member states which have more balance between national interests and Europe-wide concerns.
There are other aspects of the proposal - European virtual access products and institutional changes to BEREC - that I will not address now. They are covered in the background notes I have provided.
I referred earlier to BEREC's concerns, which are set out in the BEREC statements I have provided. The statement identifies alternatives to each of the broad themes contained in the Commission’s proposals. ComReg and BEREC are also mindful of the views of the European Parliament, as contained in the report by Catherine Trautmann MEP, which will be voted on during plenary session tomorrow. That report essentially calls for the Commission to conduct a proper integrated review of the framework instead of a having a disjointed piecemeal approach. Above all, appropriate time must be afforded to the legislator to properly consider and examine all aspects of what has been proposed and, perhaps, aspects of the regulatory framework that have not been addressed in the Commission’s proposals.
ComReg is available should the committee want a more detailed briefing on any aspect of the proposals as they have been presented or as they evolve. We will be happy to take any questions that arise today.
I thank the departmental officials and ComReg for appearing before us. Two words ring in my mind, one of which is "marginalised". It is believed that Ireland will be further marginalised. This sets alarm bells ringing straight away. Ms Licken spoke about the networks. As it is, there are issues with the networks and there are rural areas where a network has been switched off for two or three days. An issue arises over networks, not to mind the issue of our being further marginalised. We must proceed with extreme caution because networks are fundamental. If there is any attempt at centralisation to the detriment of various states, and if the word "marginalised" is being used cautiously by ComReg, it reflects greater concern over how marginalised we will be. The Irish economy and society must be protected at all costs. From the briefing, it seems the proposals are not for the betterment of Irish society. Therefore, we must proceed with caution.
The other phrase that I noted was "plain-language contracts". ComReg has appeared before us many times. The word "gobbledegook" was used in regard to contracts and documentation being sent to the ordinary punter. From both briefings today, the concept of plain-language contracts was the only item I could salvage that was any way positive to Irish society. Perhaps the delegates could elaborate on how Ireland could be marginalised and the context in which the word "marginalised" is being used. Is it being used cautiously? How do we go about protecting Ireland’s interests in the face of the proposal at this point?
Ms Katherine Licken:
In fairness, these are very early days. The proposal has been published only for a little over a month. We would not be quite so negative as to say it is a negative proposal. What we are saying is that it is a very serious proposal. It is ground-breaking and disruptive. We need to devote a lot of time and effort to our discussions with the Commission, the Council of Europe, other member states, ComReg and BEREC on the implications to ensure we get it right. There are many aspects that would be very good if we got it right, one of which would be the elimination of roaming. Better consumer protection is good. If the aim is furthering spectrum and service provision, that, too, will be good. The net neutrality provisions are good. All the aims are good; it is a question of ensuring the medicine is right and will achieve what is desired.
When we say "marginalised", all we are really saying is that we just need to be careful to ensure that marginalisation is not an unintended impact of the proposal.
I would have no hesitation in saying that it would not be an intended impact, but we must ensure it is not an unintended impact of the proposal.
Mr. Kevin O'Brien:
I used the term "marginalised" in my opening presentation, and that is particularly relevant to the issue of spectrum. As Ms Licken said, a lot of the ambition in the document is very positive, particularly on issues such as roaming and consumer rights. However, we need the detail to be right and we would question the use of a regulation rather than a directive. On the issue of spectrum, what is proposed here, for instance, with regard to the scheduling of auctions and the duration of licences that would be granted through auctions or similar competitive processes is quite dramatic in terms of moving powers in this area to the European Commission. There are five or six very large mobile operators in Europe, four of whom together account for approximately 60% of the European mobile market. If the European Commission is to decide on the awarding of spectrum and when to schedule the process for Germany, France, Italy, Spain or Ireland, we would question whether Ireland would be to the forefront of the Commission's mind in the same way as it would be to the forefront of ComReg's.
Mr. Dave Hanley:
This is a major problem for us, for the industry and for most other member states. The deadline is very unrealistic, given the enormousness and complexity of the legislation. The Commission has been very forthright about this. It wants to see it done before the current European Parliament term expires early next year. There will be further discussions in the coming days at the European Council. There is a digital team at the European Council and there will also be some discussions at prime ministerial level on the STM package. The Council conclusions as they are currently drafted do not make reference to a deadline of 2014 but the Commission would prefer if the conclusions did contain such a deadline. The whole subject of how quickly this should be done will form part of the forthcoming discussions.
Mr. Dave Hanley:
I think such a decision might come out in the Council's conclusions this weekend. However, discussions at working group level are scheduled for next week and a high-level group meeting, which Ms Licken and her colleagues attend, is due to take place in Brussels next Wednesday. One of the problems here is that there have been no really meaningful discussions at Council level on any of this yet. As Ms Licken said earlier, this was only published in the middle of September. There had been rumours and hints about it over the summer but it only came out in detail in September. There has not been much discussion at Council level yet on the detail of this. That will kick off next week.
Ms Katherine Licken:
The deadline is an aspiration of the Commission but obviously the proposal has to go through the normal Council working group and on to the European Parliament. Council, and Parliament will also have its say in that regard. Of all of the proposals I have seen so far in the telecommunications area, this one has received the most attention. For our part, we had a lot of meetings and discussions very early on in this process. A lot of effort is going into this. One can expect intensive work to take place on the proposal, one way or the other.
Ms Katherine Licken:
The Council has the authority to make that decision. However, it is a co-decision issue, so the Parliament must also make up its mind on this. The deadline is an aspiration by the Commission and does not mean it must be introduced by a certain date. It is for member states in the Council formation and for Members of the Parliament to decide on what is the best date and how much time they need to consider the proposal. That has been our experience to date - that Council and Parliament take the time they need to deal with the proposals before them.
In the opening presentation, it was stated: "ComReg and BEREC are mindful of the views of the European Parliament, as contained in the report of Catherine Trautmann, which will be voted on in plenary session tomorrow". What is Ms Trautmann's view?
Mr. Bobby Hannon:
Ms Trautmann published an own-initiative report for the European Parliament, the compilation of which began before the summer and before the Commission's proposals were published. She conducted some hearings early in September. The report essentially calls for a fundamental review of the framework and not a piecemeal approach. The report refers to a number of areas as meriting examination, which is part of the problem. As well as calling for an all-encompassing review of the framework, the report also makes a plea for full and considered deliberations. It argues that this is not something that can be rushed through.
Ms Katherine Licken:
It might be useful for members if I explain that the framework was first put together in 2002 with a series of five directives. It was reviewed again in 2009, with implementation happening in 2011, through transposition. That is the framework within which we operate. Some of the feedback we are receiving is that it would be preferable to review the framework that already exists rather than introducing something new into the mix now. Having said that, let us not throw the baby out with the bathwater. There are some very noble aspirations in this proposal and we need to look at them carefully. The main message is that time is required. We need time to go through this carefully.
I thank the officials from the Department and the representatives of ComReg for coming before the committee to inform us. We have an important political role in this, and that is an issue the committee must revisit after this discussion.
I thank the officials because I feel a bit more reassured now that I know they are fully focused on this issue. This proposal could have an enormous impact on our national telecommunications infrastructure. If this discussion was about our electricity or road infrastructure, the gallery would be packed with members of the media. Unfortunately, this is not getting the attention it deserves. The digital market is seen as a sort of cyber-world that is out there somewhere. However, this proposal will have an enormous impact and it deserves the attention we are now giving it. It is important that we treat our telecommunications infrastructure as a national asset, as the officials from the Department and the representatives of ComReg clearly do. We have an obligation, politically, to increase our own awareness of this issue as well as that of our colleagues in the national Parliament and the European Parliament. This is a huge issue.
I am very uncomfortable with the idea of total harmonisation. I see a role for co-ordination of infrastructures and for co-operation between EU countries, under the Commission, to improve digital markets.
Does Ireland have a veto on the ultimate decision on this? Has that been considered by the Minister? Perhaps it is too early to answer that question. I know discussions are ongoing with other countries in terms of what is important for Ireland and determining the significant commonalities we have with other countries. That is an important part of this.
With regard to the timeframe, the proposal only appeared a month ago. I ask the witnesses to clarify when it is expected that the European Parliament will consider this. Does the Council of Ministers have to make a decision first? Regarding the media, I read a number of reports on this proposal over the summer. The carrot is there in the form of reduced roaming charges. That is a big carrot for the public to consume. However, there are a number of other side issues about which we must be very careful. I hope that the media and politicians can focus on this issue more closely now because this is very significant.
This is a national asset and I am certainly not one for handing away how we control it. If we were to do this to the road network, airspace or electricity infrastructure, there would be an outcry. I commend the officials on their focus.
Ms Katherine Licken:
The measure will be agreed by QMV, qualified majority voting. The Council working group goes through each proposal line by line for hours on end. I do not see it coming to a point at which Ireland will be out on its own and seeking a veto. We will talk to other member states and the Commission.
I thank the delegation for their presentations. I can understand why these proposals are being put forward by the Commission because they are now technologically possible. On the face of it, it is a fairly easy sell with advantages such as streamlining and ease of access. However, it does not mean it is in the best interests of the citizens of Ireland or other EU member states. I am pleased the Department is taking a precautionary approach on this matter. We probably need to examine the examples of other jurisdictions which have made moves to unifying the market. I am particularly concerned when I see a rush to have a measure implemented within the lifetime of a parliament. That haste would inevitably result in inadequate consideration. I am heartened to hear the Department is approaching this with extreme caution.
Ms Katherine Licken:
Again, I need to stress that many good initiatives have come out of Europe and have benefited citizens in Ireland and across Europe. For example, there was the reduction in roaming charges. We all remember that if one travelled in Europe ten years ago one would have been hit with a large telephone bill. The Commission is examining what is best for Europe and has stated that more can be done in this area. However, it is about working together to get it right.
We do not have to be overly precious, I presume, on this matter. I appreciate Ms Licken’s point that the matter will be dealt with line by line by the Council. The problem is that it will not be dealt with in the same level of detail in the Oireachtas unless it is flagged now. Other interested parties, including the operators in Ireland, may have some observations from a commercial point of view as to how this measure may or may not affect them. The committee would be failing in its duty if it did not consult these interested parties.
During the recent referendum on the Seanad, there were suggestions that Oireachtas committees did not scrutinise EU legislation or use the mechanisms under the Lisbon treaty to raise red flags or concerns about European regulations and directives. In this case, the committee is not opposed or in favour of the measure but is pointing out that the time allocated for its implementation may be too short and more time needs to be given for its consideration.
I agree with Deputy Colreavy about this being implemented to fit the timescale of the forthcoming European Parliament elections. It would be regrettable if this measure, which potentially has a significant end-user and commercial impact, was introduced just to fit an electoral cycle.
I thank the delegation for its presentation. In theory this proposal is a great idea, but there is a possibility of disruption. As Mr. O’Brien said, each market has its own needs. How will the Department address this? I agree with Deputy Coffey that this is a matter of national importance. Much of the industry has reacted negatively to it. Will the delegation expand on how it will affect the consumer and the public? Is this connected to companies in Ireland that are experiencing changes to their banking arrangements to bring them into line with EU practices?
I thank the delegation for its presentation. I very much welcome any measures that will improve service and value for money offered to consumers. However, we need to look at the logistical workings of how it can be achieved. My main concern about this measure is that we are on the periphery. In Ireland, rural areas often have to fight for service provision. One can imagine that Ireland would be in a similar position in a single European market. Rural areas would then find themselves down to a third tier, rather than the second tier they are currently in.
I am also concerned about the timing of this measure, which is far from ideal. In the new year, many MEPs will be more focused on their re-election campaigns. Will this measure get the scrutiny it deserves at the European Parliament? How much public consultation with consumers and other players in this area was conducted? Was it entered into in any meaningful way? Have the unintended consequences of this measure been analysed?
I would be very slow to endorse any further erosion of control of our own matters. This is an important area. The revenue-raising potential of auctioning the spectrum for the State was referred to earlier and a figure of €850 million was mentioned. We need to protect this and act cautiously on any proposals to change it. This measure deserves total scrutiny from the committee and should be examined by other bodies of the Oireachtas too.
Mr. Kevin O'Brien:
Deputy McEntee asked how we regulate for the Irish market. Obviously, Ireland is a country with rurally dispersed population, so this is also relevant to Deputy Griffin’s questions.
I will give some examples. The universal service obligation means everybody is guaranteed the right to a network connection at a fixed point. We guarantee the price for this will be the same throughout the country. Seven or eight years ago ComReg licensed spectrum to be used to provide broadband in a way which had not been done in most of Europe. Broadband was provided in rural areas which did not have access to it at the time and there was a big take-up of fixed wireless services. The fixed networks are catching up with this and replacing it. We are now working on how Eircom prices its wholesale broadband and bitstream products. Much of what we are doing is examining the incentives for Eircom to invest outside urban areas and how we will ensure it does not overcharge or cut other operators out of the market.
These are three quickfire examples which are all undertaken more or less under existing Irish and European legislative frameworks. We can do them because of the European Commission's proposals, not despite them. The European Commission is our friend in giving these powers to regulators throughout Europe. To date, it has given them in a way which allows for a degree of choice and flexibility at local level because they are directives which are transposed. If we move to a defined regulation approach, this potential flexibility will be lost.
Ms Katherine Licken:
On the issue raised by Deputy Griffin on parliamentary scrutiny, I understand the European Parliament has appointed a rapporteur and the committee can be assured it is very alert to the import of the proposal. Elections or no elections, it will be given much time. We are always very conscious of the issue of peripherality in any proposal. We are very conscious of the divide within Ireland between urban and rural areas, which is why the Government has a national broadband plan. We are conscious of the need to ensure no proposal exacerbates it even further or marginalises Ireland in a European context. Concerns have been expressed to us by industry that there was not sufficient consultation prior to the proposal being published, but it is fair to say there is significant consultation now. The Commission has visited member states, including Ireland, and there has been a lot of activity.
I sincerely thank the departmental officials, as well as Mr. O'Brien and Mr. Hannon from ComReg, for attending and engaging with us on the proposal. It has been very helpful for the committee and will assist us in our deliberations. I propose we go into private session to consider what we should do next with the proposal.