Abstract
International mobile roaming cartel agreements prompted the EU to intervene, firstly encompassing competition law measures by a cartel exemption, then initiating several competition proceedings based on the accusation of abuse of a dominant market position, and finally applying price regulations of increasing scope. The paper exposes the temporary market power regulations, including the designated local break out measures, as insufficient and misleading. The solution is to solve the cartel problem at its root, permitting visiting customers the freedom of choosing between their home operator and alternative carriers from the visited country by the implemention of carrier portability.
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Notes
Regulation (EC) No 717/2007 of the European Parliament and of the Council of 27 June 2007 on roaming on public mobile telephone networks within the Community and amending Directive 2002/21/EC, OJ, 29.6.2007, L 171/32–40, Art. 2(d).
Commission Recommendation of 11 February 2003 on relevant product and service markets within the electronic communications sector susceptible to ex ante regulation in accordance with Directive 2002/21/EC of the European Parliament and of the Council on a common regulatory framework for electronic communications networks and services (notified under document number C(2003) 497) (2003/311/EC), OJ, 8.5.2003, L 114/45–49, recital 9.
Directive 2002/21/EC of the European Parliament and of the Council of 7 March 2002, Annex I; Directive 2002/19/EC of the European Parliament and ot the Council of 7 March 2002 on access to, and interconnection of, electronic communications networks and associated facilities (Access Directive), OJ, 24.4.2002, L 108/7–20; Commission Recommendation of 20 September 2010 on regulated access to Next Generation Access Networks (NGA), OJ, 25.9.2010, L 251/35–48.
Commission Recommendation of 20 September 2010 on regulated access to Next Generation Access Networks (NGA), OJ, 25.9.2010, L 251/35–48.
Directive 2002/21/EC of the European Parliament and of the Council of 7 March 2002 on a common regulatory framework for electronic communications networks and services (Framework Directive), OJ, 24.4.2002, L 108/33–50, Annex I.
Commission Recommendation of 20 September 2010.
Directive 2002/21/EC of 7 March 2002.
Commission Recommendation of 11 February 2003, Annex, Market 17.
Regulation (EC) No 717/2007 of the European Parliament and of the Council of 27 June 2007 on roaming on public mobile telephone networks within the Community and amending Directive 2002/21/EC, OJ, 29.6.2007, L 171/32–40.
Regulation (EC) No 717/2007, recital 6.
Regulation (EC) No 717/2007, Art. 13.
Regulation (EU) No 531/2012 of the European Parliament and of the Council of 13 June 2012 on roaming on public mobile communications networks within the Union (recast) (Text with EEA relevance), OJ, 30.6.2012, L 172/10–35, Art. 22.
Directive 98/61/EC of the European Parliament and of the Council of 24 September 1998 amending Directive 97/33/EC with regard to operator number portability and carrier pre-selection, OJ, 03.10.1998, L 268/37–38.
Directive 98/61/EC, 37.
Directive 2002/22/EC of the European Parliament and of the Council of 7 March 2002 on universal service and users’ rights relating to electronic communications networks and services (Universal Service Directive), OJ, 24.4.2002, L 108/51–77, Article 19(1).
Directive 98/61/EC, Article 1(3).
Regarding the definitions in Art. 2c and Art. 2d of the Directive 97/33/EC (Directive 97/33/EC of the European Parliament and of the Council of 30 June 1997 on interconnection in Telecommunications with regard to ensuring universal service and interoperability through application of the principles of Open Network Provision (ONP), 26.7.1997, OJ, L 199/32–52), the notions of “telecommunications network” and “telecommunications service” are related to fixed networks as well as mobile networks. Art. 12(5) is doubtless related only to fixed networks. As the Directive was written more than 15 years ago, it basically related to fixed networks. Mobile communications worldwide as well as within the EU was then still of relatively minor importance.
Directive 2002/22/EC, Article 30.
Directive 98/61/EC, 37.
Commission Recommendation of 11 February 2003, Annex, Market 16 or Commission Recommendation of 17 December 2007 on relevant product and service markets within the electronic communications sector susceptible to ex ante regulation in accordance with Directive 2002/21/EC of the European Parliament and of the Council on a common regulatory framework for electronic communications networks and services, OJ, 28.12.2007, 344/65–69, Annex, Market 7.
Case 36.153 GSM International Roaming Agreements. Date of closure: 11.11.1997; Exemption 85(3) without publication (http://ec.europa.eu/competition/antitrust/closed/en/comfor97.html, downloaded in March 2013).
Case 37.034 GSM MoU Association 3, Date of closure. 30.11.1999; Individual exemption 81(3) (http://ec.europa.eu/competition/antitrust/closed/en/comfor99.html, downloaded in March 2013).
See Commission challenges UK international roaming rates, IP 04/994, Brussels, 26 July 2004, and Competition: Commission challenges international roaming rates for mobile phones in Germany, IP/05/161, Brussels, 10 February 2005.
Antitrust: Commission closes proceedings against past roaming tariffs in the UK and Germany, IP/07/1113, Brussels, 18 July 2007.
Commission Recommendation of 17 December 2007, Annex.
Directive 2002/21/EC, Article 15 and Annex I.
Regulation (EC) No 717/2007, recital 6.
Commission Recommendation of 11 February 2003, Annex.
Commission Recommendation of 17 December 2007, Annex.
Regulation (EC) No 717/2007.
Regulation (EU) No 531/2012, recital 13.
The European Economic Area (EEA) consists of the countries of the EU, Iceland, Norway and Lichtenstein.
EU only for Q2 2009—Q1 2010.
EU only for Q2 2009—Q1 2010.
See for example: http://www.telefonino.net/Benefon/Notizie/n1440/index.html.
Regulation (EU) No 531/2012, recital 32.
Regulation (EU) No 531/2012, recital 33 and Art. 4 and Art. 5
According to BEREC (2012, Annex 3, 8) “Basic Single IMSI cannot realistically change competition at wholesale level”.
Regulation (EU) No 531/2012.
IMEI is necessary for safety reasons (Benoit et al. 2004, Section 5.1.2), but can also be applied to “open” the mobile phone for alternative SIM cards.
Such bundling strategies are well-known from antitrust cases known as requirements tie-ins and may result in welfare-improving price differentiation strategies (Carlton and Perloff 2005, 231ff.).
In European countries SIM-lock strategies are not regulated and competitive policy also does not generally prohibit SIM-lock strategies. In Belgium a law prohibiting the bundling of a network service contract with a mobile handset has even been ruled illegal by the European Court of Justice as violating the Unfair Commercial Practices Directive 2005/29/EC. In the past handset subsidies have been successful commercial offers and a widespread practice in many countries (Díaz-Pinés 2010, 38). However, SIM-only strategies as well as the unbundling of the mobile handset and communications tariff contracts are gaining in popularity. A law prohibiting bundling and legally enforcing unlocked SIM would result in overregulation. Instead, a regulatory obligation for network carriers to offer an optional choice between SIM-locked and SIM-unlocked mobile handsets is required. In order to combine the goal of price differentiation by offering subsidized mobile handsets on the one hand and the goal of allowing competition on the market for international roaming on the other, the mobile carrier should be obliged by technical regulation to offer an unlock option. Consumers interested in changing carriers in guest countries should have the possibility to do so, whereas consumers interested in subsidised mobile handsets with low demand for communications in foreign countries may keep with SIM-locked mobile handsets.
Thus, temporary number portability is different from the approach of using the original IMSI when incoming calls are received under application of dual IMSI—allowing to buy a local SIM card while travelling in a foreign country.
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