Telecoms operators this week asked the European Commission to clarify new anti-monopoly guidelines for the sector amid fears that legal uncertainty could add to the pressures facing industry participants.
The European Union's executive has proposed an ambitious regulatory package, due for approval by late 2001, aimed at updating and harmonising existing rules for all electronic communications sectors and services.
The Commission's guidelines, which are incorporated within the telecoms package, are meant to coach national telecoms regulators on how to apply the principles of EU competition law to what used to be monopolistic markets. More competition could lead to price reduction, which would benefit consumers.
But at a public Commission hearing this week, many telecoms operators and sector experts expressed concern that the guidelines were too vague.
The guidelines rest heavily on the principle of significant market power. Any operator found to have significant market power, roughly 40-50% market share, could face obligations such as access, price-capping and transparency.
Former telecoms monopolists such as Telefonica, Deutsche Telekom and France Telecom tried to argue with the Commission that in the rapidly changing market for electronic communications, a large market share does not lead automatically to abuse of power or distorted competition. But the Commission flatly rejected such objections.
