Brussels, 04 March 2002
A study carried out for the European Commission focusing on the progress made in unbundling the local loop has concluded that efforts made so far have been 'very unsatisfactory'. The Commission has requested that all stakeholders give their reaction to the report.
The report by law firm Squire, Sanders and Dempsey concludes that two major barriers remain to new entrants to the telecommunications market. These are tariff and cost related problems inherent to the unsatisfactory economic conditions in which unbundling is taking place, and the reluctance of incumbents to open up their facilities to competitors.
Other feedback from new entrants which is included in the study indicates that some of them left the sector completely after being deterred by price squeezes and obstructive behaviour, some of which the study concludes could be infringements of competition law.
The Commission has already launched infringement proceedings against some Member States and may consider taking action against firms abusing a dominant position. As well as seeking opinions of stakeholders, the Commission intends to set up a public hearing before the summer to analyse the subject further. The Commission has already outlined that it sees the effective unbundling of the local loop in Europe to be a key element of helping create access to broadband access in particular and the creation of the information society in general.
In a separate development, the EU committee of the American chamber of commerce in Brussels welcomed the efforts being made by EU Enterprise and Information Society Commissioner, Erkki Liikanen, in trying to ensure that Europe benefited from broadband access, but says it shares the Commission's concerns over the level of progress in the area.
It set out a list of proposals which it said would be helpful in implementing the access. These included enforcement of existing legislation, benchmarking of implementation, promotion of competition between service providers, use of fiscal incentives, enhancement of broadband access to enterprises and encouragement of public authorities to act as catalysts for developments when the market is not sufficiently present.
See also Commission Press Release: IP/02/348
To send your comments on the report's findings, please contact: E-mail:
comp-local-loop@cec.eu.int