Effective sectoral regulation: Telecommunications in the EU

Abstract

Abstract The principles of effective sectoral regulation in the European Union (EU) are discussed. The EU telecoms industry, which will be extensively liberalized in January 1998, is used to illustrate the arguments. We discuss two themes: the principles of sectoral regulation and regulatory structure. We argue that the European Commission (EC) can choose from two alternative regulatory structures. It can maintain the status quo strengthened by directing member states to adopt competition rules in line with Articles 85 and 86 of the European Treaty. Although this approach has merits, we favour the alternative which is the establishment of a dual regulatory system with preemption rights. This has a greater chance of delivering co‐ordination and facilitating effective competition in a single market. Subsidiarity would not be compromised as many regulatory rules would be implemented by national regulatory authorities (NRAs). Dual regulation would require the establishment of an EU wide regulatory authority, ...