In the third and last article from the series devoted to the newly proposed European Electronic Communications Code the focus of analysis is on regulation of spectrum as a scarce resource.
Spectrum, like other resources such as numbers, is a scarce resource that belongs to the EU Member States, and whose management and assignment needs to take into account national specifics and needs. In the course of the present overhaul of the telecom rules the EU legislator points to a need for a more convergent and consistent Union regulation for market entry in order to eliminate the obstacles caused by divergent conditions for the assignment of individual rights of use for spectrum. Consistent rules on an EU level are necessary to (i) enable providers to expand their services to other Member States; (ii) create a sufficient market scale effect allowing front running Member States to benefit from it; (iii) give timely access to state of the art wireless capacities and services for EU citizens and businesses to benefit from the digital environment; (iv) allow countries which are lagging behind to catch up and participate in the Digital Single Market; and, (v) treat all spectrum users in a coherent way throughout the Union. Lastly, in order for the EU to lead the rest of the world in new and enhanced services, such as 5G, equipment manufacturers and providers of communications services need sufficient scale. This means not only technical harmonization, but most importantly an internal market developing in a broadly aligned fashion, for services and devices to benefit from stable and harmonized rules.
In view of this conceptual background, Article 45 of the EEC Code provides an overview of the general objectives and guiding principles that Member States need to follow in their spectrum management policies at a national level. First, they need to ensure coverage of their territory and population at high quality and high speed that also includes all major transport paths. Areas that are similar in network deployment or population density need to be subjected to similar coverage conditions. Further, Member States are required to apply the most appropriate and least onerous spectrum authorization system possible in a way that maximizes flexibility, sharing and efficiency in the use of radio spectrum. The shared use of radio spectrum between similar and/or different uses needs to be promoted by way of sharing rules and conditions. Last but not least, regulatory certainty and predictability needs to be established on a national level through clear and transparently defined and applied rules for granting, transfer, renewal, modification and withdrawal of rights to use radio spectrum.
The provision of Article 46 highlights a strong preference for general authorizations for use of spectrum and calls for limiting the use of individual licenses only to situations where that is necessary for maximization of efficient use in light of the demand. It also provides for Commission powers to adopt binding measures to achieve consistency within different types of authorization regimes.
Article 47 provides clarity in view of the attachment of conditions to general authorizations and to rights of use for radio spectrum. When such conditions are imposed their goal shall be to ensure the most efficient use of spectrum by the beneficiaries. Any such conditions shall be clearly defined and shall include the level of use required and the possibility to trade and lease in relation to this obligation. Additionally, conditions attached to renewals of right of use for radio spectrum may not provide undue advantages to existing holders of those rights. With a view to maximizing radio spectrum efficiency, when determining the amount and type of radio spectrum to be assigned, competent authorities shall take account of the possibility to combine complementary bands in a single assignment process. When they attach conditions to individual rights of use for radio spectrum, competent authorities will have the power to authorize the sharing of passive or active infrastructure, or of radio spectrum, as well as commercial roaming access agreements, or the joint roll-out of infrastructures for the provision of services or networks which rely on the use of radio spectrum.
The provisions in Articles 48-54 target key aspects of spectrum authorization with a view to enhancing regulatory consistency in Member States’ practice. Article 49 establishes a minimum license duration of at least 25 years. It is interesting to note that in the draft report with amendments to the EEC Code prepared by the Committee on Industry, Research and Energy to the European Parliament an even longer minimal period of at least 30 years is proposed. Article 51 sets a clear and simpler process for spectrum trading and leasing. Additionally, Article 52 focuses on the promotion of effective competition in the internal market when deciding on the granting, amendment or renewal of rights of use for radio spectrum. When pursuing that goal NRAs can: i) limit the amount of radio spectrum for which rights of use are granted or attach conditions to such rights, ii) reserve a part of a frequency band or group of bands for new entrants, iii) refuse to grant spectrum in certain bands in order to avoid distortion of competition, iv) prohibit the transfer of rights of use for radio spectrum where such transfers are likely to result in significant harm to competition. The Commission is also provided with powers to adopt measures that set common maximum deadlines for authorizing the use of harmonized spectrum in all Member States and for coordinating the major elements of selection processes and setting criteria for their design.
Articles 55 and 56 of the EEC Code simplify conditions for access to Wi-Fi, to meet the exponential demand for connectivity and for the deployment and provision of low-power wireless broadband access (small cells) to reduce costs of deploying very dense networks. Under Article 55 competent authorities are required to allow the provision of access through radio local area networks (RLANs) to a public communications network including when harmonized radio spectrum is used for that provision. Such provision of services shall be subject only to general authorization conditions. Further, Article 56 requires competent authorities to allow the deployment, connection and operation of unobtrusive small-area wireless access points under the general authorization regime and imposes upon them to not restrict unduly such deployment, connection or operation through individual town planning permits or in any other way.
Overall, the EEC Code confers on NRAs competences in respect of market and economic regulatory aspects of spectrum assignment for electronic communications services. They are also made competent for deciding on the imposition of exceptional measures on network/spectrum sharing and national roaming with a view to cover white connectivity spots. National regulators must base their action in this field on a sound economic and competitive analysis of the markets. In order to ensure the consistent application across the EU of assignment conditions which have an impact on economic, market and competitive conditions and thus on market functioning, Article 35 of the Code creates a peer review mechanism for BEREC to review the market and economic regulatory aspects of national draft spectrum assignments and issue non-binding opinions.