The European Parliament has approved sweeping reforms to strengthen competition and consumer rights in Europe's telecoms markets.

The proposed telecoms reform package put forward by the European Commission received formal approval from the European Parliament on 25 November 2009.

Despite its importance to the European economy, the telecoms sector is still largely fragmented along national lines. There is an umbrella European regulatory framework but this has been implemented inconsistently at national level, making it more difficult for operators to provide pan-European services.  The European Commission has proposed new tools to ensure coordination and consistency across the European Union which have now been approved.  There will be five different Directives regulating the telecoms sector: Framework; Access; Authorisation; Universal Service and e-Privacy.

The main points of the reform are:

  1. Better regulation. The Commission's powers will be increased enabling the Commission to oversee the remedies proposed by national regulators.  This may include the issue of a recommendation that requires the national regulator to amend or withdraw its planned remedy or to adopt further harmonisation measures in the form of recommendations or (binding) decisions.
  2. Strengthening the internal market. A new European Telecoms Body will be established to help to ensure fair competition and consistent regulation of the telecoms market; The body will be named the Body of European Regulators of Electronic Communications (BEREC) and will replace the loose co-operation between national regulators that currently exists.
  3. Better protection for consumer. The reforms not only strengthen existing rights, but also create new ones, such as: (1) the right to switch fixed or mobile operator in one working day whilst allowing users to keep their number; (2) the right to be better informed about the services users subscribe to; (3) the right to be informed about data breaches by telecoms operators; and (4) the right to compare the different offers on the market by requiring operators to publish information on their prices.

Furthermore, national telecoms authorities will also have the power to set minimum quality levels for network transmission services. The new law will also allow, as a last resort, the separation of a dominant operator's network and services businesses to resolve persistent competition problems and allow a better use and allocation of frequencies to facilitate their trading.

The agreed telecoms reform package is the result of four years of discussions, including two years of consultations with stakeholders, national regulators and users of telecoms services. Following the formal adoption of the reforms package on 25 November 2009, the accompanying legislative documents entered into force on 18 December 2009. BEREC will be established in Spring 2010 and the reforming legislation must be implemented into national law by mid-June 2011.

As a result of this tiered implementation schedule, it will be some time before the full effects of the reform package is seen at a national level. What is clear from the scope of the reform is that a significant amount of change to the telecoms industry is imminent.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.