Regulatory Outlook

Regulatory Outlook | Telecoms | January 2021

Published on 13th Jan 2021

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Current issues

Implementation of the EECC

The European Electronic Implementation Code (EECC) replaces the existing European telecoms regulatory framework and aims to harmonise the EU regulatory framework for electronic communications.

The EECC extends end-user rights, requiring service providers to review their contracting processes and also extends the definition of electronic communication services to include over-the-top services. This means OTT providers will now have to understand and comply with telecoms regulation.

Member States were required to implement the EECC by 21 December 2020. In the UK implementation is by way
of updates to the Communications Act 2003 and General Conditions of Entitlement as well as the Wireless Telegraphy
Act 2006.

Due to the change of definition of electronic communications services, certain provisions of PECR will apply to the OTT
providers for the first time.

5G Action Plan

The EU’s 5G Action Plan intends to achieve uninterrupted 5G coverage by 2025. With the EECC also supporting the deployment of 5G networks, huge investment will be required for network operators to buy spectrum, upgrade core network software and install millions of small cells. Ofcom has also confirmed that it will auction radio spectrum in the 700MHz and 3.6-3.8GHz bands early in 2021 to support the roll-out of 5G.

The UK Electronic Communications Code sets out the rules by which telecoms operators can access land to install equipment. The code is supposed to help speed up the growth of the networks required to deliver 5G but a proliferation of litigation between land-owners and telecoms operators means that it seems to be having the opposite effect.

Call for change in traditional services

As cloud-based technology, instant messaging and Voice over Internet Protocol (VoIP) services develop, the demand for traditional communication services is decreasing and Ofcom is reviewing the retirement of traditional copper networks. The Covid-19 pandemic has put additional pressure on telecoms services to upgrade capacity and network resilience. As a result, businesses may need to start considering evolving their service packages to include cloud-based technology.

2G and 3G switch off

As mobile evolution develops, the spectrum resource used for 2G and 3G networks is going to begin to be repurposed for 5G. Network operators may start sunsetting 3G networks in the UK in 2021. With thousands of devices, including many IoT solutions such as smart meters, connected to 2G and 3G (and not being technically capable of using 4G or 5G services), mobile operators and businesses will need to assess what impact this will have on their business, contracts and internal processes.

In Focus: Regulation after Brexit

What do UK businesses trading in the EU need to do now that the Brexit transition period has ended?

The main considerations that businesses will need to take into account in deciding what they need to do now are as follows:

End of roam-like-at-home provisions: The UK is now a third country for the purposes of the Roaming Regulation. This regulation, which caps what the domestic EU operator can charge the foreign EU operators for connecting the foreign operator’s customers and prohibits the charge being passed onto the consumer, will no longer apply to UK operators. However, the UK government’s EU Exit Regulations require mobile operators to: (i) inform customers travelling abroad when they have reached 80% and 100% of their data allowance; (ii) provide a financial limit on data usage abroad of £45; and (iii) inform customers how to avoid inadvertent roaming near the borders.

Mobile operators may need to review their roaming agreements and reach commercial agreement on the rates that will apply in the absence of regulated wholesale rates and consider whether any additional costs are passed on to the end-customer. They will have to take reasonable steps to protect consumers from paying excessive roaming charges. Businesses may find that their mobile charges when travelling on business could rise following the transition period.

Free movement of services will continue: The TCA preserves the previous general authorisation regime for UK communications service providers who provide electronic communications networks and services in EU Member States. This means that UK communications services providers will not be required to obtain prior authorisation from an EU Member State prior to providing the services in that Member State, although prior notification of the provision of communications services may still be required depending on the rules in each Member State.

Net Neutrality will continue: The UK government has transposed the Open Internet Regulation which enshrines the principle of network neutrality into UK law and this principle has been retained under the TCA. Nevertheless, the UK government will have some freedom to adopt measures which may cut across the broad principle of net neutrality where the aim of such measure is to protect the public safety of users online, such as the existing parental controls permitted under the Digital Economy Act.

What do non-UK businesses trading in the UK need to do now that the transition period has ended?

No additional steps are required for non-UK businesses to provide electronic communications services in the UK as the UK operates under a general authorisation regime; meaning that there are no notification or express licence requirements (other than for spectrum licences) and no requirement to have an establishment in the UK to provide electronic communication services in the UK.

Which incoming EU laws should UK businesses be aware of, and is the UK likely to implement similar rules?

The EECC was required to be implemented by 21 December 2020. However, Ofcom has confirmed a staggered approach with between 12 and 24 months for service providers to implement the changes. Although DCMS has announced that some EECC requirements will not be fully implemented by the EECC deadline, DCMS has stated that it is aligned with the principles of the EECC and would be bringing the substantive provisions into UK law irrespective of Brexit.

The ePrivacy Regulation will replace the ePrivacy Directive (which is implemented in the UK under the Privacy and Electronic Communications Regulations 2003), however it has been a challenge for European legislators to reach agreement on the text. We may see agreement reached in 2021, but as this will be after the end of the transition period, this will not apply in the UK.

Businesses that operate on a pan-European basis will need to follow the new ePrivacy Regulation in respect of their EU operations but in the UK, the 2003 regulations will continue to apply unless and until the UK brings in its own reforms.

Are there any other areas where the UK regime might start to diverge from that of the EU? If so, what should businesses do to ensure they are prepared?

It is unlikely that the UK telecoms regime will diverge significantly from existing EU law as the UK has been a driver of European telecoms legislation. Roaming charges is the most likely area where a divergent approach may occur as, in  the absence of cross-border agreement, will be determined by commercial factors.

The question for the UK will be whether it changes current law to follow planned and future EU reforms such as the ePrivacy Regulation, as well as and future EU regulation in relation to new telecoms technologies.

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