Proposal for a European Parliament and Council Decision on the co-ordinated introduction of mobile and wireless communications (UMTS) in the Community (98/C 131/05) (Text with EEA relevance) COM(1998) 58 final - 98/0051(COD)

(Submitted by the Commission on 3 March 1998)

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European Community and in particular Articles 57, 66, 100a thereof,

Having regard to the proposal of the Commission,

Having regard to the opinion of the Economic and Social Committee,

Having regard to the opinion of the Committee of the Regions,

(1) Whereas the Commission presented on 29 May 1997 to the European Parliament, to the Council, the Economic and Social Committee and the Committee of the Regions a Communication (1) on the further development of mobile and wireless communications;

(2) Whereas after consulting the industry and other parties concerned (2), and considering the trade, industry, frequency and standardisation aspects of UMTS, the Commission has presented on 15 October 1997 a Communication (3) on a Strategy and Policy Orientation with regard to the further Development of Mobile and Wireless Communications (UMTS) and proposed policy orientations and actions to increase investment security in UMTS and to prepare the necessary regulatory framework so as to promote innovation and flexibility by industry;

(3) Whereas on 1 December 1997, the Council invited the Commission 'to submit by early 1998, a proposal for a European Parliament and Council Decision which would enable orientations to be established on the substance of the issue and will facilitate within the existing Community legal framework, the early licensing of UMTS services and, if appropriate and on the basis of the existing repartition of competencies, in respect of co-ordinated allocation of frequencies in the Community and pan-European roaming` (4); whereas the European Parliament has adopted on 29 January 1998 a resolution (5) expressing its strong support to the Commission's Communication on the 'Strategy and Policy Orientations with regard to the Further Development of Mobile and Wireless Communications`;

(4) Whereas UMTS is not a single system or network but a modular concept; whereas subsequent to the current second generation of mobile systems, a new generation of innovative systems needs to be developed for the provision of wireless wideband multimedia services, including Internet and other Internet Protocol (I/P) based services, flexible and personalised service provision, support of high volume data rates combining the use of terrestrial fixed and mobile as well as satellite components; whereas this decision shall apply to satellite components without prejudice to the European Parliament and Council Decision 710/97/EC of 24 March 1997 on satellite personal communications (6); whereas there is a need to ensure rapid market access for a ubiquitous coverage and low cost, and innovative service offering through a sufficient level of competition;

(5) Whereas the ITU World Administrative Radio Conference (WARC 92) identified in 1992 frequency spectrum for the development of both the satellite and terrestrial parts of Future Public Land Mobile Telecommunications System (FPLMTS), later renamed IMT-2000; whereas according to ITU Resolution 212 and to the World Radiocommunications Conference in 1995 (WRC 95), the initial implementation of the terrestrial element should take place around the year 2000;

(6) Whereas UMTS in the Community needs to be compatible with the third generation mobile system concept called International Mobile Telecommunications-2000 (IMT-2000) developed by the International Telecommunications Union (ITU) at world level on the basis of ITU Resolution 212;

(7) Whereas mobile and wireless communications are of strategic importance both for the development of the Community telecommunications industry and the Information Society as well as for the Community economy and employment as a whole; whereas the Commission has adopted on 3 December 1997 a Green Paper on the convergence of the telecommunications, media and information technology sectors, and the implications for regulation (7); whereas on the basis of the consultation which will result from that Green Paper, the Commission will take into consideration the impact of convergence on UMTS considering in particular the review of Community telecommunications regulation by 1999; whereas early decisions on harmonisation of authorisations and co-ordination of the introduction of UMTS services should aim at creating a favourable climate for investment and deployment of UMTS;

(8) Whereas this requires specific regulatory action at Community level on licensing procedures, spectrum availability and harmonisation and standardisation; whereas in order to ensure the development of Community-wide as well as pan-European and global services with the widest possible territorial coverage, Member States should ensure the rapid and simultaneous introduction of compatible UMTS services in the Community on the basis of internal market principles by means of a co-ordinated approach; whereas diverging national laws, regulations and administrative action would hinder or prevent the provision of Community-wide and global UMTS services, and the free movement of related equipment;

(9) Whereas existing Community legislation including competition rules, in particular Commission Directive 96/2/EC of 16 January 1996 on mobile and personal communications (8) and Commission Directive 96/19/EC of 13 March 1996 (9) on full competition, as well as Directive 97/13/EC of 10 April 1997 of the European Parliament and of the Council on a common framework for general authorisations and individual licences in the field of telecommunications services (10) (Licensing Directive) and Directive 97/33/EC of the European Parliament and the Council on Interconnection in Telecommunications with regard to ensuring Universal Service and interoperability through application of the Principles of ONP (11) (the Interconnection Directive) apply to this sector;

(10) Whereas UMTS service providers should be able to enter the market without unnecessary constraints to allow for a dynamic market and a broad competitive service offering; whereas where an authorisation procedure is considered necessary, general authorisations or declarations should be the rule;

(11) Whereas pursuant to Community law, in particular Directive 97/13/EC of the European Parliament and the Council and Directive 96/2/EC of the Commission: i) individual licenses should be limited to the operation of UMTS networks, ii) the number of UMTS licenses may only be limited for reasons of demonstrated lack of frequency spectrum capacity, iii) licenses should be made accessible to any organisation and should not be reserved for existing operators of other systems;

(12) Whereas conditions to be attached to authorisations should be defined in such a way as to secure Community-wide and pan-European services as well as roaming capabilities through co-ordinated introduction; whereas Europe-wide roaming will enable industry to meet user and societal needs; whereas the conditions listed in the Annex of the Licensing Directive may be imposed on a UMTS system by a Member State even where no part of that system is located within the territory of that Member State; whereas national licensing regimes and harmonisation of licensing conditions and procedures among telecommunications authorities should be adopted without delay in the context of the CEPT in co-operation with ECTRA for UMTS; whereas in particular the one-stop-shopping procedure provided in the Licensing Directive should apply to the granting of individual licenses and for notifications in the case of general authorisations to facilitate the granting of UMTS services authorisations to undertakings in more than one Member State;

(13) Whereas the amount of spectrum made available will have a direct impact on how competitive the marketplace will be; whereas estimated demand should therefore determine the amount of spectrum to be allocated; whereas sufficient spectrum must be allocated and cleared sufficiently in advance to foster a broad competitive offering of mobile multi-media services;

(14) Whereas spectrum allocation is most efficiently pursued in the context of the CEPT by the European Radiocommunications Committee (ERC); whereas according to CEPT rules, CEPT country members which also include Community Member States, are free to commit themselves to implement ERC decisions; whereas it should therefore be ensured that appropriate and timely regulatory measures are taken in the Community to achieve the implementation of ERC decisions if necessary; whereas Member States shall provide the Commission with regular information as to the implementation of ERC measures; whereas complementary Community action may be required to ensure the timely implementation of CEPT decisions within Member States;

(15) Whereas measures adopted by the ERC and ECTRA are, if consistent with Community law, a basis for the use of the relevant frequencies and for the preparation of the criteria for the authorisation of UMTS; whereas sufficient spectrum will be necessary to foster the development of a market with a broad competitive offering of mobile multi-media services; whereas the European Radiocommunications Committee (ERC) has adopted on 30 June 1997 Decision ERC/DEC/(97)07 on the frequency bands for the introduction of Universal Mobile Telecommunications Systems (UMTS) which entered into force by 1 October 1997;

(16) Whereas this ERC decision has designated the frequency bands 1900-1980 MHz, 2010-2025 MHz and 2110-2170 MHz to terrestrial UMTS applications, and accommodates UMTS satellite component applications within the bands 1980-2010 MHz and 2170-2200 MHz; whereas it already appears that additional frequency spectrum capacity will be necessary to meet the demand in the Community and to ensure introduction of UMTS in Europe even before 1 January 2002; whereas sufficient spectrum must be allocated within the bands identified by WARC 92 according to the increasing needs therefore before UMTS services are commercially deployed; whereas additional frequency spectrum may become necessary by 2005 and therefore the 900, 1800 and 1900 MHz bands would also need to be freed or refarmed as far as possible;

(17) Whereas at ITU level the review of spectrum and regulatory issues relating to UMTS and the facilitation of multimode terminal operation and world-wide roaming of IMT-2000 have been included in the WRC 99 agenda in order to identify additional frequency spectrum to satisfy market demand by 2005-2010; whereas therefore European common positions need to be developed and promoted at global level with the participation of all parties interested;

(18) Whereas spectrum availability and appropriate pricing, coverage and quality will be essential aspects to the success of UMTS development; whereas any spectrum pricing method should not adversely impact on the competitive structure of the market, should respect the public interest, guarantee roaming capabilities while ensuring efficient use of the spectrum as a valuable resource;

(19) Whereas Europe-wide roaming of UMTS services is essential to the development of pan-European UMTS services as a basis for the internal market for telecommunications; whereas specific co-operation among operators may be also necessary to provide coverage of less populated areas;

(20) Whereas a proposal has been presented on 4 June 1997 by the Commission for a Council and European Parliament Directive on connected telecommunications equipment and the mutual recognition of the conformity of equipment (12) to amend the Council Directive 91/263/EEC of 29 April 1991 on the approximation of the laws in the Member States concerning telecommunications terminal equipment, including the mutual recognition of their conformity (13); whereas appropriate harmonised standards developed by ETSI and recognised under Directive 91/263/EEC will ensure free movement of terminals and will allow the putting into service of UMTS in the Community (14);

(21) Whereas as provided in the Interconnection Directive, interconnection to public telecommunications networks and publicly available telecommunications services provided by organisations having significant market power shall follow the principles of non-discrimination and transparency;

(22) Whereas, without prejudice to Community competition law, organisations providing UMTS networks must have rights and obligations to negotiate roaming and infrastructure sharing agreements with other telecommunications organisations to ensure seamless Community-wide service coverage; whereas such negotiation needs to occur on the basis of a common, open and internationally competitive air-interface standard;

(23) Whereas urgent and specific action at Community level is required in order to reach co-ordinated introduction of UMTS on the basis of common, open and internationally competitive standards, in order to secure Community-wide roaming of future UMTS services at low cost as well as early licensing of UMTS services in the Community in the bands identified by the CEPT;

(24) Whereas the Community should build on the success of the current generation of mobile digital technology including GSM both in Europe and in the world taking into consideration interworking between UMTS and second generation systems; whereas there should be no discrimination between GSM operators and new entrants on UMTS markets;

(25) Whereas the UMTS aims at a global market and therefore should be placed in a global context on the basis of a coherent plan for the Community; whereas the creation of a common standard in the Community would help European industry in competing on global markets; whereas compatibility with other standards of the ITU IMT-2000 family would facilitate interworking and roaming at global level; whereas the ITU has set the deadline of May 1998 for the adoption of the 'IMT-2000 Family Concept`, to September 1998 for submitting candidates for the radio interface for the 'IMT-2000 Family Concept` of standards and to end 1999 for the adoption of IMT-2000 standard final recommendation by ITU; whereas this Family Concept supports a set of air interfaces and of core network standards; whereas a common European UMTS standard should be adopted and proposed as a member of that Family in order to increase the chances of UMTS to be adopted on markets outside Europe; whereas these deadlines therefore need to be met within the Community;

(26) Whereas while voluntary application of standards remains the general rule, recourse to mandatory standards may be required for interfaces and situations where necessary to ensure interoperability and facilitate roaming of mobile networks and services; whereas harmonised standards are adopted by standardisation bodies such as the European Telecommunications Standards Institute (ETSI) which facilitates regulatory action; whereas the proposals for common technical regulations are, as a general rule, drawn up on the basis of harmonised standards and of additional consultations;

(27) Whereas in order to allow for effective service competition and innovation, the UMTS standardisation process should be limited to what is necessary for systems development while allowing for service provision differentiation;

(28) Whereas common and open European standards are essential for the critical interfaces, in particular the air interface (UMTS Terrestrial Radio Access - UTRA) and for the UMTS core network in order to foster a strong start of UMTS in the Community and to ensure end-to-end interoperability in a pan-European environment and open competition for roaming traffic and to avoid market fragmentation in Europe, increased costs of UMTS systems and loss of competitiveness;

(29) Whereas the Commission has granted in 1995 to ETSI a general standardisation mandate related to UMTS pursuant to Council Directive 83/189/EEC of 28 March 1983 (15) and Council Decision 87/95/EEC of 22 December 1986;

(30) Whereas the ETSI mechanism dealing with intellectual property rights (IPRs) in the context of standardisation should be followed; whereas ETSI members should make every attempt to unveil intellectual property rights applicable to UMTS in the world;

(31) Whereas adequate support should be provided within the Community R& D programmes with the objective of further developing the technological basis for UMTS; whereas this would involve further research into technical solutions for UMTS such as software radio;

(32) Whereas social and societal effects should be taken into account in the transition towards the wireless information society; whereas UMTS development should be co-ordinated with related efforts such as the development of a Community-wide information society, support of training on UMTS related technologies, access for elderly and disabled persons, research on possible hazards of mobile communications;

(33) Whereas the implementation of UMTS systems and services should take into consideration the needs of potential groups of users working in services of public interest (health, education, transport, environment, etc.) and pay attention to the requirements that have already been incorporated into European standards;

(34) Whereas market access and free circulation of UMTS systems and terminals to the global market should be promoted; whereas interoperability of UMTS services at Community and global levels should be encouraged among the industry, standardisation bodies and Member States;

(35) Whereas the need to ensure the introduction of interoperable UMTS at both pan-European and global levels may require the conclusion of a number of agreements with third countries on, inter alia, interconnection, roaming, free movement and use of equipment at global level through multilateral rules, access to third countries' networks and markets; whereas these agreements are closely related to market access arrangements;

(36) Whereas Community undertakings should fully benefit from international trade agreements such as agreements signed within the World Trade Organisation (WTO) and have effective market access in the specific terms and conditions, including national treatment, binding on those countries within the WTO;

(37) Whereas UMTS equipment would be covered by international tariff agreements entered by the Community such as the Information Technology Agreement signed in the framework of the World Trade Organisation (16) and the Istanbul Convention on the elimination of customs duties on personal effects and professional equipment (17);

(38) Whereas the Community may take all necessary actions to implement international agreements; whereas the Commission may start further multilateral and bilateral negotiations on aspects of UMTS on the basis of specific mandates from the Council, which should make it possible to conclude balanced agreements ensuring further effective access for Community operators in third countries as well as mutual recognition arrangements for global circulation of terminals;

(39) Whereas the results of the international consultations and other changes in the situation may require that decisions taken pursuant to this Decision be amended or other appropriate measures be undertaken;

(40) Whereas in the implementation of this Decision, the Commission should be assisted by the Licensing Committee established by Directive 97/13/EC; whereas the Committee should act as a consultative committee according to the procedure laid down in Article 16 or as a management committee type II b according to the procedure laid down in Article 17 of Directive 97/13/EC;

HAVE ADOPTED THIS DECISION:

Article 1

Purpose

The aim of this Decision shall be to facilitate the rapid introduction of compatible UMTS networks and services in the Community on the basis of internal market principles and in accordance with commercial demand by means of co-ordination of national licensing regimes.

Article 2

Definition

For the purpose of this Decision, Universal Mobile Telecommunications System (UMTS) shall mean a third generation mobile communications system capable of providing in particular innovative wireless multimedia services, beyond the capability of current second generation systems such as GSM, and combining the use of terrestrial and satellite components. It shall include the characteristics referred to under Annex I.

Article 3

Co-ordinated authorisation

1. Member States shall take all actions necessary in order to allow the harmonised provision of the UMTS services on their territory by 1 January 2002 at the latest and in particular shall establish an authorisation system for UMTS no later than 1 January 2000.

2. When preparing and applying their authorisation systems Member States shall ensure

- that the provision of UMTS services is organised in frequency bands which are harmonised by CEPT in accordance with the procedure laid down in Article 5,

- and pursuant to European standards developed by ETSI where available, including in particular a common, open and internationally competitive air-interface standard. Member States shall ensure that licenses support roaming throughout the Community.

3. When authorising UMTS services, Member States shall ensure that the specific characteristics listed in Annex I are implemented.

4. In the case of incompatibility of potential systems and if it is established in accordance with the procedure laid down in Article 17 of Directive 97/13/EC and in conjunction with CEPT that it is necessary to limit the number of UMTS services authorisations, Member States shall coordinate their authorisation procedures with a view to authorising compatible UMTS services in the Community.

Article 4

Roaming Rights and Obligations

1. Member States shall ensure that organisations providing UMTS networks have rights and obligations to negotiate roaming agreements with other organisations providing UMTS networks to ensure seamless Community-wide service coverage.

2. Member States may where necessary take action, including the promotion of agreements between operators in accordance with Community law, to ensure the coverage of less populated areas.

Article 5

Co-operation with CEPT

1. The Commission shall, in accordance with the procedure laid down in Article 16 of Directive 97/13/EC pursuant to the timetable set out in Annex II, give CEPT/ERC and CEPT/ECTRA mandates to harmonise frequency use and the conditions attached to authorisations for UMTS networks and services without prejudice to the provisions of the Licensing Directive regarding individual licences. Those mandates shall define the tasks to be performed and lay down a timetable.

2. On the completion of the mandates, it shall be decided in accordance with the procedure laid down in Article 17 of Directive 97/13/EC whether the result of the work done pursuant to the mandates shall be made applicable in the Community.

3. Notwithstanding Article 5(2), if the Commission or any Member State considers that work done pursuant to the mandate given to the CEPT/ECTRA or CEPT/ERC is not processing satisfactorily having regard to the timetable laid down, it may refer the matter to the Licensing Committee, which shall act in accordance with the procedure laid down in Article 17 of Directive 97/13/EC.

Article 6

Co-operation with ETSI

The Commission shall take all necessary measures where appropriate in co-operation with ETSI to promote a common and open standard for the provision of compatible UMTS services throughout Europe, in accordance with market requirements, taking into account the need to present a common standard to the International Telecommunications Union (ITU) as an option for the world-wide ITU IMT-2000 standard.

Article 7

The Committee

In the implementation of this Decision, the Commission shall be assisted by the Licensing Committee set up by Article 14 of Directive 97/13/EC.

Article 8

Exchange of Information

1. The Commission shall regularly inform the committee of the outcome of consultations with the representatives of telecommunications organisations, users, consumers, manufacturers, services providers and trade unions.

2. The committee shall, taking into account the Community's telecommunications policy, encourage the exchange of information between the Member States and the Commission on the situation and the development of regulatory activities regarding the authorisation of UMTS services.

Article 9

International Aspects

1. The Commission shall take all necessary measures to faciliate the introduction of UMTS services in third countries and the free circulation of UMTS equipment.

2. For this purpose, the Commission shall make proposals to take all necessary actions to seek the effective implementation of international agreements applicable to UMTS, and shall, in particular and where necessary, submit proposals to the Council for appropriate mandates for the negotiation of bilateral and multilateral agreements with third countries and international organisations. The Council shall decide by qualified majority.

Article 10

Notification

Member States shall give the Commission such information as it may require for the purpose of verifying the implementation of this Decision.

Article 11

Confidentiality

1. Neither the Commission nor the national regulatory authorities shall disclose any information covered by the obligation of professional secrecy, in particular information about undertakings, their business relations or their cost components.

2. Paragraph 1 shall be without prejudice to the right of national regulatory authorities to undertake disclosure where it is essential for the purposes of fulfilling their duties, in which case such disclosure shall be proportionate and shall have regard to the legitimate interests of the undertakings in the protection of their business secrets.

3. Paragraph 1 shall not preclude the publication of information on licensing conditions which does not include information of a confidential nature.

Article 12

Duration

This Decision shall enter into force on the 20th day after its publication in the Official Journal of the European Communities and shall remain in force for four years after that date.

Article 13

Report

The Commission shall keep developments in the field of UMTS under review and report to the European Parliament and to the Council on the effectiveness of action taken pursuant to this Decision after two years.

Article 14

Implementation

Member States shall take all measures necessary, by law or administrative action, for the measures provided for in, or agreed on pursuant to this Decision to be implemented.

Article 15

Addressees

This Decision is addressed to the Member States.

(1) COM(97) 217 final, 29.5.1997.

(2) The UMTS Forum has been set up on 16 December 1996 among regulators, operators, manufacturers, satellite operators and other interested parties as well as the European Telecommunications Standards Institute (ETSI), the European Radiocommunications Office (ERO) and the European Telecommunications Office (ETO), with the support of the Commission; this Forum aims at developing common views for the development and implementation of UMTS and advice on the development of a policy framework relating to the introduction of UMTS.

(3) COM(97) 513 final, 15.10.1997. Communication from the Commission to the Council, the European Parliament, the Economic and Social Committee and the Committee of the Regions - Strategy and policy orientations with regard to the further development of mobile and wireless communications (UMTS) - Outcome of the public consultation and proposals for creating a favourable environment.

(4) Conclusions of the Council of 1 December 1997.

(5) Resolution of the European Parliament of 29 January 1998 - A4-0027/98.

(6) OJ L 105, 23.4.1997, p. 4.

(7) COM(97) 623.

(8) Commission Directive 96/2/EC of 16 January 1996 amending Directive 90/388/EEC with regard to mobile and personal communications, OJ L 20, 26.1.1996, p. 59.

(9) Commission Directive 96/19/EC of 13 March 1996 amending Directive 90/388/EEC with regard to the implementation of full competition in telecommunications markets, OJ L 74, 22.3.1996, p. 13.

(10) OJ L 117, 7.5.1997, p. 15.

(11) OJ L 199, 26.7.1997, p. 32.

(12) OJ C 248, 14.8.1997, p. 4.

(13) OJ L 128, 23.5.1991, p. 1.

(14) A consensus agreement has been reached on 29 January 1998 within ETSI in view of the elaboration of a common radio interface standard for UMTS called UTRA.

(15) OJ L 109, 26.4.1983, p. 8.

(16) Agreement on Trade in Information Technology Products, Council Decision 97/359/EC of 24.3.1997.

(17) Council Decision 93/329/EEC of 15.3.1993, OJ L 130 of 27.5.1993, p. 1.

ANNEX I

CHARACTERISTICS OF UMTS

Services

1. Multimedia capability with wide area mobility

2. Efficient access to the Internet, Intranets and other Internet Protocol (I/P) based services

3. High quality speech commensurate which that of fixed networks

4. Service portability across distinct UMTS environments

5. Indoor, outdoor and far outdoor operation of GSM/UMTS in one seamless environment including full roaming with GSM as well as between the terrestrial and satellite components of UMTS networks

Terminals

- Dual mode/band GSM/UMTS terminals, where appropriate

- Dual mode terrestrial/satellite UMTS terminals, where appropriate

Radio Access Networks

- New air interface for access to all services including to packet data based services

- Good overall spectral efficiency

Core network

- Evolution from GSM system family; call control mobility management including full roaming functionality based on core GSM network standard

- Mobile/fixed convergence elements

ANNEX II

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