Non-paper: Sweden’s key messages and proposals for the Digital Networks Act

In brief:

• Broadband access network regulation should be simplified and made more transparent by moving to a model without the burdensome designation of operators with significant market power.
• Information requirements should be simplified, and assessed with regard to their usefulness to end-users and clarity for providers and end-users. To the extent possible, information requirements should be horizontal and sector-generic while avoiding overlap and conflicts with other legislation.
• Cyber fraud should be combatted at the EU level. To be able to respond to current and future methods of fraud, legislation with the purpose of addressing misuse of electronic communications services should be proposed that is flexible and future proof.
• Predictable and long-term conditions for radio spectrum within the EU promote new investments. The EU should decide on a new Radio Spectrum Policy Programme to support key EU policy areas. The Commission should have a more prominent role in relation to third countries regarding e.g. disruptions and coordination agreements. Furthermore, a more coordinated management of satellite operators at EU level should be implemented, enabling Direct-to-Device satellite services.

Simplification and efficiency

Focusing on simplification of rules and better enforcement will help avoid overlapping and conflicting legislation, address barriers to innovation and increase the competitiveness of European businesses. Regulatory simplification also contributes to legal clarity.

Symmetric and efficient network access rules to increase investments

• The current, complex regulatory regime involving the assignment of companies with Significant Market Power (SMP) should be succeeded by symmetric rules for fibre access networks. Symmetrical regulation at EU level would increase predictability, reduce administrative burdens and should increase incentives for investments compared to the current model.
• Operators owning fibre access networks should have an obligation to provide access to wholesale dark fibre on fair and reasonable terms.
• The regulation of termination (handover) of voice calls on mobile or fixed networks could also be streamlined. The general framework for access and interconnection (Article 59 in the Code) should include an obligation for operators providing voice call termination to apply rates in accordance with the Commission Delegated Regulation (EU) 2021/654.
• Consequently, Articles 63-66 in the Code would no longer be necessary and could be replaced with simplified rules stating that operators shall be deemed to have significant market power if they own fibre access networks or terminate voice calls.
• If national regulatory authorities, after analysis, identify competition problems where symmetrical obligations are not sufficient, appropriate obligations may still be imposed in accordance with Articles 69-74, 76 and 80 in the Code, choosing the least intrusive means of addressing the problems identified.
• If the SMP regulation is succeeded by symmetric rules, the rules for functional separation and voluntary commitments are no longer relevant. Articles 77-79 in the Code could therefore be removed.
• Existing rules for consultation should be maintained.
• Access to radio local area networks is currently well-functioning. The rules in Article 56 in the Code can therefore be removed, as this area no longer needs to be regulated. 

Simplified information requirements for the benefit of end-users and enterprises

• The information requirements in the Code should be reviewed. To ensure the continued protection of end-users, the information requirements should be assessed with regard to their usefulness to end-users and clarity for providers and end-users.
• To the extent possible, information requirements should be horizontal and sectorgeneric. Overlap and conflicts between the information requirements in the Code and other legislation, such as the TSM Regulation, the Consumer Rights Directive and the GDPR, should be addressed. Horizontal information requirements could reduce the regulatory burden for providers, lower market entry barriers, and facilitate for end-users to more readily comprehend the provided information, as it would become consistent across markets.
• Whether information requirements should still be applicable to end-users who are microenterprises, small enterprises or not-for-profit organisations should be evaluated. If possible, also from a horizontal perspective.
• The current requirement in the Code that end-users should have access to at least one independent free comparison tool, Article 103, should be removed. The increased complexity and rapid development of end-user electronic communications products make them difficult to compare one-to-one, leading to potentially misleading results and limited utility for end-users.

Protecting end-users

Cyber fraud is an international problem, often targeting vulnerable groups such as the elderly, and has become an increasingly important source of income for criminal networks. As new technology has made it easier and more convenient to carry out purchases and banking transactions, the opportunities for fraudsters to access personal data and bank accounts have increased. The regulatory framework must ensure continued end-user trust in electronic communications services.

• Cyber fraud should be combatted at the EU level. By introducing common rules to combat cyber fraud, including fraud committed through the use of number dependent and number-independent electronic communications services, cooperation between competent authorities can be simplified and burdens on providers and other actors minimised.
• Article 97(2) in the Code addresses the risk of fraud by providing that access to numbers and services may be blocked, on a case-by-case basis, where justified by reasons of fraud or misuse. However, number-independent electronic communications services as well as virtual numbers are also used to enact fraud. This should be reflected in the DNA’s rules on fraud prevention.
• Service providers must be given the necessary tools to prevent fraudulent situations. It is common that new methods of fraud arise as a response to actions taken to combat it. Legislation with the purpose of addressing misuse of electronic communications services must therefore be flexible.

Harmonisation

To facilitate investments within the EU, Member States and the Commission should increase the focus on harmonising the sector-specific rules. In an interconnected world, where geopolitics increasingly impacts technology, we need to ensure that the critical infrastructure is secure, trusted and resilient throughout the EU.

The DNA should be drafted in the format which produces the best long-term results in terms of harmonisation. It is also just as important to focus on legal enforcement once the legislation is in place.

Making use of full harmonisation to the largest possible extent will help improve the Single Market, creating market certainty and scope for investment at a time where such investments are critical for European competitiveness and security. This needs to be coupled with thoroughly drafted impact assessments and competitiveness checks, including with regard to SMEs. Connectivity is a complex business, which is reflected in the extensive Code. Today the market structure and situation differ between Member States.

Maximising the long-term benefits of radio spectrum.

Predictable and long-term conditions for radio spectrum within the EU promote additional investments. Harmonisation minimises the risk of interference between electronic communications networks and services, within the Union and at its external borders.

• The EU should decide on a new Radio Spectrum Policy Programme (RSPP) to support key EU policy areas, maximize the long-term societal benefits of radio spectrum, and increase cost efficiency. The policy should promote competition and innovation through an efficient use of radio spectrum, i.a. through award designs that incentivizes sector investment.
• The Commission should have a more prominent role in relation to third countries regarding e.g. disruptions and coordination agreements. The role of the Commission in negotiations with third countries, when requested by a Member State, could be enhanced, i.a. by giving the RSPG "Good Offices" the role of defining the work plan, the negotiation objectives, timeline and the actions to achieve those objectives. This would ensure a better consistency of these actions.
• A more coordinated management of satellite operators at EU level should be implemented, enabling Direct-to-Device satellite services. The Commission should propose an update of the EU legal framework to allow for the implementation of common requirements in national authorisation frameworks for providers of satellite electronic communications services The Commission should also propose an update of the EU legal framework with procedures for when a Member State identifies a noncompliance with common requirements if it is not resolved nationally. Such procedures should include reporting, assessment and collective reaction (such as mechanisms to handle and resolve cases of non-compliance to common requirements).
• The rules on harmonisation of the 3,5 and 26 GHz band (Article 54 in the Code) and the so-called "small cells" regulation (Article 57) should be abolished as they are not needed. As a principle individual technologies or spectrum bands should not be regulated through law but harmonized in RSPP.
• Specific regulation regarding networks, technologies and services should be reviewed in view of the technical development and the changes of the penetration of such services and how this affects the need for such specific regulation in different fields. 

Looking ahead

Europe is world-leading in advanced telecommunications. Its political leaders have both an opportunity and a responsibility to shape future developments in this field. In this nonpaper, Sweden has presented key messages and a number of concrete proposals for a future DNA in order to help address the challenges facing the EU described in several recent reports. As policy evolves and new proposals may form, we look forward to being a constructive partner in the continued analysis and discussions on these crucial topics