TELECOMMUNICATIONS: COMMISSION CONDEMNS LACK OF UMTS HARMONISATION.

The context.The sums paid by telecommunications operators for UMTS licences in eleven European countries (Denmark, Greece, Ireland, and parts of France have still to allocate licences) totals Euro 130 billion. Operators face comparable costs for installing infrastructures and marketing new services. Moreover, since spring 2000, the enthusiasm of operators has waned significantly following a re-evaluation of the risks posed by UMTS. Thus France was only able to allocate two licences, owing to a lack of candidates. The commercial value of the UMTS spectrum has declined sharply since the auctions in the United Kingdom and Germany, which brought in Euro 38.5 and 50 billion respectively). The Dutch and Italian Governments, which had also hoped to hit the jackpot, had to be content with Euro 2.68 and 12.16 billion respectively.One of the basic problems identified by the Commission has been the absence of common rules for the allocation of licences in the EU. Member States, says the Commission, staunchly opposed the harmonisation of allocation procedures and UMTS licence conditions. This gave rise to market inconsistencies. The cost of licences varies from Euro 0 in Sweden and Finland to Euro 650 million in the United Kingdom. The Commission also notes the considerable differences between network conditions (legal requirements regarding cover and network sharing arrangements). Finally, the conditions for access to second-generation mobile networks have not been addressed similarly in all Member States.The EU Executive denounces the Member States' traditional preference for minimal solutions in terms of harmonisation. The legislative package proposed by the Commission in July 2000 contained several provisions concerning harmonisation of radio frequency spectrum use:- the proposal for a framework Directive (COM(2000)393 of 12 July 2000) permitting the Commission to require a Member State to amend or withdraw measures envisaged (notably regarding the use of the spectrum) if they run counter to the policy objectives of the new framework;- the proposal for a Decision on a regulatory framework for the radio-frequency spectrum (COM(2000)407 of 12 July 2000) provides a mechanism for harmonising the assignment and conditions for non-military use of the radio frequency spectrum.The Commission proposals include several other important elements for guaranteeing the success of future wireless services.The Commission wants to convince Member States to adopt a...