Select Committee on Trade and Industry First Special Report


APPENDIX 3A

LOCAL LOOP UNBUNDLING - GOVERNMENT RESPONSE

The introduction of local loop unbundling in the UK is the result of an initiative taken by OFTEL, the independent regulator. This initiative has been reinforced by the decision of the European Commission to introduce a Regulation requiring unbundling in all Member States - a step which the Government could wholeheartedly support. Given that local loop unbundling is essentially a regulatory measure, the Committee's recommendations are directed principally to OFTEL, which is responding separately (see Appendix 3B). However, recommendation (m), which relates to e.Europe benchmarking, is addressed to Ministers and the Department has accordingly prepared the comments below in relation to this issue.

e.Europe

(m) We look forward to hearing that the UK has indeed caught up with Germany and the Netherlands by the end of 2001. We recommend that the Government press the Commission to produce a scoreboard on progress on unbundling as part of the e.Europe benchmarking programme. We recommend that the Government encourage the European Commission to produce a similar document [to Oftel's factsheet] detailing progress across all Member States (paragraphs 49 and 52).

The Government needs to accept the need to encourage the production of transparent information about progress on local loop unbundling at the European level. The eEurope Action Plan has an objective of stimulating the provision of cheap Internet access, and gives significant weight to the introduction of the Regulation on local loop unbundling. Although the associated benchmarking exercise, which tracks 23 indicators over the whole breadth of the Action Plan, will measure Internet access costs, it looks at all means of access, not just the local loop. In due course it is also expected to generate supplementary indicators for the cost of various patterns of use, and for high speed access, including through ADSL. However, the Government believes that the best source of the information about progress across Europe will emerge not from the benchmarking of eEurope, but from the Commission's own monitoring of the implementation of the Regulation. The results will reach Member States principally in regular reports to the ONP (Open Network Provision) Committee which monitors measures for the liberalisation of communications markets. They can also be expected to be given publicity in the annual Implementation Report prepared each Autumn by the Commission detailing performance on liberalisation in the individual Member States as well as an overview of progress in the Union.


 
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Prepared 20 July 2001