The Hungarian Presidency of the Council of the EU is expected to delete any mention of consolidation of the telecoms market in the next draft of its conclusions on 9 October, four sources with knowledge of the matter told Euractiv.
The issue is top-of-mind for the telecoms sector, as well as the next Commission.
The Council kickstarted the process on 21 August in response to the Commission’s February white paper, which argued for industry consolidation through deregulation. Member states have been hesitant to heed this call.
In the latest draft, the Hungarian presidency tried to strike a balance between stakeholder views.
But after the Tuesday (24 September) Telecoms Council Working Group, sources told Euractiv on condition of anonymity that the Hungarian attempt to bridge views will be changed.
Both former Italian Prime Ministers Enrico Letta and Mario Draghi also supported market consolidation in their reports this year.
“The Council underlines that market-driven consolidation, assessed by the relevant authorities taking into consideration its potential impact, could foster investment [in telecoms],” reads the latest Council compromise text, dated 18 September.
A working document seen by Euractiv and dated 16 September showed that member states would be critical of this Hungarian proposal.
Indeed, despite Hungary’s attempt to find a delicate balance in its reference to market deregulation, sources told Euractiv that this line was criticised during Tuesday’s working party.
Member states argued that the proposed line was too prescriptive.
In its place, Hungarians are expected to add a line that competition drives investment in telecoms infrastructure, contrary to what largest EU telecommunications operators claims.
Ex ante regulation, allocating funds
Hungarians are also expected to modify the text to clarify that the Commission should first review the EU’s telecoms law, the European Electronic Communications Code (EECC), before suggesting any shift from ex ante to ex post regulation.
The ex ante regulation currently in place attempts to prevent monopolistic practices, whereas ex post regulation would impose remedies and fines after such behaviour has occurred.
The current text calls on the Commission to suggest such a change “in the context of the review” of the EECC, not after the fact.
EU funds allocation
Member states also want the Hungarian Presidency to change the text to ensure that a new telecoms strategy is published by the Commission before allocating EU funds to support the security and resilience of submarine cables infrastructures.
Multiple other editorial changes should surface in the second compromise text to fine-tune the document.
Member states have until 30 September to respond to Hungary’s draft in writing. The second compromise text is expected to be circulated on 9 October, in time for the second working group meeting on 15 October.
[Edited by Eliza Gkritsi & Owen Morgan]
