Market Analyses under the New European Communications Framework - Some Conceptual Issues

Abstract

For electronic communications markets, a new regulatory framework was enacted and should have been transformed into national law by all member states of the EU by the summer of 2003. In fact, this new regulatory framework is composed of five different directives, stretching the goals of a harmonized regulatory approach within the National Regulatory Agencies (NRAs). On whole, the new regulatory framework is designed as to ensure the transition to general competition law. As the title suggests, our specific focus will be on the completely rearranged and much broader market analysis procedure within the new framework. In doing this, the paper is supplemented by the relevant legal documents. Accordingly, this paper makes various references to important passages in the Framework Directive, the Commission’s SMP Guidelines and IRG/ERG documents discussing methodological aspects. Concretely, the directives (especially Articles 14–16 of the Framework Directive) in conjunction with the Commission’s SMP Guidelines outline a three stage analysis process: preliminary definition of relevant commimications markets, examination of effective competition on those markets and discussion of appropriate regulatory instruments based on any competition deficits. Although it appears to be practically useful to structure these stages sequentially, logical linkages, as it will be shown, conceptually exist among them.

The views expressed are those of the author entirely and do not represent those of RTR or TKK. Professional thanks to Paul Pisjak and Christian Paiser; Very special thanks to Andy Hyacinth!!

All market analyses conducted under the new regulatory framework are subject to the (implicit) assumption of sufficiently rational consumer behaviour. All the more, our assumption appears to be reasonable since NRA’s represent a dedicated capacity for permanent market monitoring.