State aid: Commission adopts new Broadband Guidelines

Brussels, 24-12-2012 — /europawire.eu/ — The European Commission has adopted revised guidelines for the application of EU state aid rules to the broadband sector. These guidelines will help Member States achieve the objectives of the EU Digital Agenda. Taking into account the extensive submissions from all stakeholders, they contain in particular a reinforcement of open access obligations and improved transparency rules. They also follow the principles of the Commission’s State Aid Modernisation (SAM) initiative, which aims at facilitating well-designed aid targeted at market failures in order to achieve growth-enhancing priorities, while simplifying the rules to allow for faster decisions.

Commission Vice President in charge of competition policy Joaquín Almunia said: “To achieve the ambitious goals of the Digital Agenda in promoting very fast broadband connections throughout the EU, we need to achieve the right mix between public and private investment while building a pro-competitive environment. These new rules will allow for well-designed public interventions targeted at market failures and ensure open access to state funded infrastructure”.

The changes are based on a two-staged public consultation and an intensive dialogue with all stakeholders (Member States, national telecoms regulators, aid granting authorities, telecommunications operators, business associations, consumer associations and citizens).

These changes focus on the following principles and priorities:

• Technological neutrality: the new guidelines take into account technological advances, acknowledging that super-fast (Next Generation Access) networks can be based on different technological platforms.
• Ultra-fast broadband networks: to help achieve the Digital Agenda objective of delivering very fast connections (of more than 100 Mbps) to half of European households by 2020, the revised guidelines will allow public funding also in urban areas but subject to very strict conditions to ensure a pro-competitive outcome.
• Step change to connectivity: to protect private investors, the guidelines require that any public investment must fulfil a so-called “step change”: publicly financed infrastructure can only be allowed if it provides a substantial improvement over existing networks and not only a marginal improvement in citizens’ connectivity.
• Reinforcement of open access: when a network is realised with taxpayers’ money, it is fair that the consumers benefit from a truly open network where competition is ensured.
• Transparency: new provisions regarding the publication of documents, a centralised data base for existing infrastructure and ex post reporting obligations to the Commission have been introduced.

Background

Better, faster broadband is the top priority in 2013-14 of the revised Digital Agenda for Europe (DAE) (IP/12/1389) is a flagship initiative of the Europe 2020 Strategy aimed at fostering economic growth. The Digital Agenda sets ambitious objectives for broadband infrastructure development, namely to bring basic broadband to all Europeans by 2013 and ensure that, by 2020, (i) all Europeans have access to much higher internet speeds of above 30 Mbps and (ii) 50% or more of European households subscribe to internet connections above 100 Mbps.

Public authorities may fund such investments in line with the EU state aid rules. To facilitate pro-competitive investments, the Commission adopted the first broadband guidelines in 2009 (see IP/09/1332 and MEMO/09/396).

To adapt the guidelines to fast moving technology markets and to the objectives of its Digital Agenda (see IP/10/581 and MEMO/10/199) and State Aid Modernisation initiative (see IP/12/458), a review process was launched in 2011, with a first public consultation (see IP/11/493). After assessing the submissions, the Commission drafted revised guidelines and consulted stakeholders again in June 2012 (see IP/12/550). In light of comments received, the Commission has now finalised the new guidelines, which will enter into force from the first day following its publication in the Official Journal of the EU. The Commission may review the new guidelines on the basis of future important market, technological and regulatory developments.

The formal adoption and publication of the new guidelines in the Official Journal in all EU official languages is foreseen for January 2013. For information purposes, the full text of the guidelines is available in the working languages of the EU institutions at: http://ec.europa.eu/competition/state_aid/legislation/specific_rules.html#broadband