Telco industry believes provisional agreement diverges from the Act’s original intentions but pledges to work with legislators

The European Commission, Council and European Parliament’s negotiators have agreed to key compromises to replace the 2014 broadband cost-reducing directive (BCRD) with the Gigabit Infrastructure Act (GIA).

The so-called tacit approval – feared by some Member States as a legal and legislative minefield will remain a voluntary principle and the abolition of intra-EU communication ‘surcharges’ – essentially international roaming in the EU – has been given a gentle glidepath to land between 2029-2032. 

“In Europe, the roll-out of fibre and 5G could be a lot easier with less administration. We are tackling that administrative burden through the so-called Gigabit Infrastructure Act,” said Belgian deputy prime and minister and telecom minister Petra de Sutter. “We have struck a preliminary agreement with the European Parliament now. This would allow European citizens to surf faster using fibre or 5G.”

The European Council said the provisional agreement maintains the general thrust of the Commission’s proposal. However, the co-legislators amended key parts of the proposal including: 

> a mandatory conciliation mechanism between public sector bodies and telecom operators was introduced as an intermediate step to facilitate the permit-granting procedure 

> an exception for a transitional period for smaller municipalities was included, as well as specific provisions to promote connectivity in rural and remote areas 

> the factors when calculating fair and reasonable conditions for access were clarified 

> a specific provision to address the presence of intermediaries between landowners and infrastructure operators was introduced 

> specific provisions were agreed on a voluntary ‘fibre-ready’ label for buildings 

> several carve-outs for critical national infrastructure were included in the text. 

Finally, given that the current retail price for regulated intra-EU communications will expire on 14 May 2024, the provisional agreement provides for the continuation of consumer protection, especially for vulnerable users, by extending the price caps, which are €0.19 per minute for calls and €0.06 per SMS message at present. Abolishing these fees has been a political priority for the European Parliament for several years, but Council opposition has blocked it happening – until now (or 2029). 

Euractiv reports that by 30 June 2027, the Commission will have to deliver an impact assessment on the phase-out of the retail price cap. The EU executive should consider the wholesale market, impact on consumer prices, and evolution of consumer preferences as part of its analysis. By 1 January 2029, following an implementing act by the European Commission taken no later than 30 June 2028, intra-EU communication fees will effectively be “abolished” – that is, retail prices will be equal to national domestic prices. 

As soon as 2025, and to push the market to start applying these rules, telecom operators will be allowed to reduce their retail prices to their national domestic prices, reports Euractiv. 

Tacit approval not approved 

The so-called tacit approval principle – where a “no answer” by a public authority would mean telco build work was automatically approved – was watered down in the end following objections from some countries. Now, EU countries will be able to derogate from the tacit approval principle and either compel their permit-granting authorities to compensate applicants if they fail to reply in due time or give applicants the right to file a complaint in court. If Member States derogate, disputes will lead to conciliation hearings. The agreed deadline for a permit granting being considered late has been set to four months. If the administrative authority is not responsible for the delay it may be able to extend by a further four months.  

Industry not happy 

The GSMA’s response to the GIA was guarded. “While some aspects of the agreement unfortunately appear to no longer match the initial level of ambition set out by the EU Commission, we will continue to engage in this process, including a thorough impact assessment for Intra-EU calls,” said GSMA director of policy Rita De Castro. 

“In addition, we look forward to participating in the broader process towards a new framework for digital connectivity, including the forthcoming Digital Networks Act, to ensure that operators’ ability to invest remains a key priority,” she said.  

ETNO said in a statement that the agreement “departs from the original level of ambition as set out by the European Commission”. It added: “We note the dilution of crucial measures to reduce timing and cost of roll-out. These include the so-called tacit approval, which is now only an optionality for Member States, leading to potential fragmentation in the single market. Ambitious proposals by the European Commission and the European Parliament would have better responded to the urgency of rolling out gigabit networks.” 

“We also take note that further retail price regulation of intra-EU calls is still on the table, subject to prior Impact Assessment. We encourage a thorough assessment, conducted in full respect of the Better Regulation principles, recognising the existence of competitive markets as well as the socio-economic value of network deployment,” stated ETNO.  

Happy campers 

The European Commission welcomed the political agreement reached between the European Parliament and the Council on the Gigabit Infrastructure Act which it said comes at same time of the adoption of the Recommendation on the regulatory promotion of gigabit connectivity (Gigabit Recommendation).  

The Gigabit Recommendation provides to National Regulation Authorities guidelines on how to design access remedy obligations for operators with significant market power, to guarantee fair competition and at the same time to foster the rollout of gigabit networks by ensuring that all operators can have access to existing network infrastructures.  

In particular, the Gigabit Recommendation provides guidance on situations where access to civil-engineering infrastructure is likely to be the only access remedy to address the competition problems identified. It also indicates how National Regulation Authorities can smoothly conduct the migration from copper to fibre. 

“The EC believes the GIA simplifies and streamlines permit granting procedures, which are a precondition for network deployment, ensuring public administrations’ compliance with the deadlines for granting permits,” opined the EC statement. “It also introduces measures to digitalise information on existing physical infrastructures, planned civic works, and permit granting procedures, allowing operators to access online all information necessary for planning network deployment.” 

Next steps 

The agreement reached on the GIA now needs to be formally adopted by the European Parliament and the Council. Next, technical work by experts of both institutions will continue with a view to submitting a compromise text to the co-legislators for endorsement. From the Council side, the Belgian presidency aims to present the text to member states’ representatives (Coreper) for approval as soon as possible.  

Following its approval, the draft legislative act will be submitted to a legal/linguistic review before being formally adopted by both institutions, published in the EU’s Official Journal, and entering into force 20 days after this publication. The new rules will be directly applicable in all Member States 18 months after its entry into force, with certain provisions applying slightly later.  

The new rules will replace the Broadband Cost Reduction Directive. The Gigabit Recommendation replaces the Next Generation Access Recommendation (2010) and the Non-discrimination and Costing Methodology Recommendation (2013).