EU Countries Urged Not to Meddle With Revamp Package When They Adopt It

Parliament’s vote was “a great victory for the internal market, for the launch of the digital market and most of all for European consumers,” Viviane Reding, the information society and media commissioner, told reporters. The new rules cover a wide range of issues including net neutrality, consumer protection, number portability, data breaches, competition and the creation of a new body of national regulators. They give the telecom industry legal certainty to invest in high-speed broadband and new wireless services, she said.

They also include, for the first time, an Internet freedom provision, Reding said. This replacement for Amendment 138 bars government action restricting access unless it’s necessary, proportionate and follows a fair, impartial procedure that guarantees human rights (CD Nov 6 p8). Approval of the entire package was “a victory for the Parliament” because it was able to force changes to many of the original proposals, said Herbert Reul of Germany’s European People’s Party. It’s part of the team that negotiated the Amendment 138 compromise.

“The debate is over: Now we expect action,” said Chairman Innocenzo Genna of the European Competitive Telecommunications Association. He urged EC President Jose Manuel Barroso to appoint a commissioner “with the drive and vision to kick-start the market and resist pressure from governments seeking to protect inefficient dominant firms.” Alternative telecom companies believe the new rules ensuring nondiscriminatory access to fiber networks are “crucial to rein in regional monopolies,” Bingham McCutchen attorney Axel Spies said for the German Competitive Carriers Association, VATM.

Tuesday’s vote “confirmed the importance” of the telecom industry to Europe’s economy, said Director Michael Bartholomew of the European Telecommunications Network Operators’ Association. He welcomed new provisions aimed at spurring investment in new infrastructure. But including authority for regulators to order “functional separation” -- forcing companies to split their network and services arms -- is inappropriate in “today’s lively, competitive markets,” he said.

The European Publishers Council and Interactive Advertising Bureau Europe praised the measure for ending legal uncertainty about Internet cookies. Parliament rejected earlier language requiring pop-up windows or other intrusions for users to opt in to cookies, saying the control settings in Web browsers comply with the requirement for consent for cookies.

By retaining the current opt-out system, lawmakers gave businesses a solid legal basis for relying on browser settings when they use cookies, the organizations said. The provision increases consumer protection but doesn’t impede Internet functions, they said. Governments must adopt the laws “with great care” to ensure they're coherent and harmonized, the groups said. Slip-ups risk differing interpretations, barriers to the single market and consumer confusion, they said.

Innovative breach notification provisions will reinforce user security and promote trust in online transactions, the Business Software Alliance said. The measure requires communications services providers to tell customers if their personal data is breached. The EC plans to extend that requirement to data breaches in all contexts, the Alliance said.

Not everyone is happy with the final product. During debate Monday, several lawmakers said provisions on net neutrality and online rights don’t go far enough and must be strengthened later. Parliament must be vigilant about how the compromise on Internet rights is adopted into national laws, said Philippe Lamberts of France and the Green Party.

Some governments are also wary. In Nov. 18 declarations following their approval of the compromise text -- ministers had adopted the rest of the package in October -- the Netherlands said it has “great difficulty” with the central role of the European Commission in regulating telecom markets under the new rules. National authorities “should have more latitude to take account of specific market circumstances and not be able to be overruled by the Commission in doing so,” it said.

Sixteen countries said they consider the EC’s decision- making power to be “limited to matters concerning market definition, assessment of significant market power.” It’s also limited to the effect of market analysis on whether antitrust conditions should be imposed on companies, and not to extend to the choice and design of the conditions, the nations said.

Lawmakers were “a bit disappointed” by governments’ seeking to wriggle out of the new rules, said Catherine Trautmann of France and the Progressive Alliance of Socialists and Democrats. The alliance is the author of one of the legislative reports on the EC reform proposals. Telecom ministers agreed unanimously on the package, Reding said. Declarations aren’t legally binding, and the EC will use its power if national regulations endanger Europe’s single market, she said.

“There is no reason to celebrate,” said La Quadrature du Net, a public-interest group. The final text contains some consumer protections, but they don’t make up for loopholes and threats to fundamental rights in the rest of the provisions, it said. Murky areas “will require close scrutiny” as the package is enacted into national law, it said. La Quadrature has been scathing concerning parliament’s about-face on the rejection in Amendment 138 of Internet access termination without a prior judicial ruling and regarding the EC’s failure to impose net neutrality.

The measure will be signed Wednesday by government and parliamentary officials. EU countries will have 18 months to enact it into national law.