“Connected Continent” – Telecoms Single Market regulation – Chapters IV and V
User Rights and Changing Providers
Views of BT Group plc
Introduction
The chapters on rights of end-users and changing of providers proposed by the European Commission
contain elements of detail which need further clarification, better targeting of the actual problem identified
(and evidence – often lacking in the Impact Assessment), or amendment to deliver more practical value for
consumers. As originally worded, the proposals risk reducing incentives for competition and innovation,
without securing workable or effective protection for end-users.
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We broadly support the vote in the European Parliament Plenary, which addresses many of the above
points and which opts for a Directive as a more suitable legal instrument for many of the User Rights
elements (but notably not the Open Internet provisions).
Differentiating consumer and business customers’ needs
Although the Commission’s proposals are intended to protect consumer rights, many of the articles confuse
the different needs of consumers and business customers (of potentially any type or size), and the absence
of a clear and practical definition of ‘micro enterprises’ would mean applying most of the provisions to all
business users, regardless of their size or actual requirements. Business customers typically negotiate
contracts to meet specific needs (such as high quality of service, quick repair times) so it is not appropriate
to apply the same procedures or rules as suit consumers, and to do so would impose costs (eg for new
systems development) for undefined customer benefits. Similar issues arise with switching. The relevant
articles [all articles in Chapters IV & V except Arts. 22, 29] should be amended to explicitly distinguish
consumer needs from those of different categories of business users.
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These points have been largely dealt with by amendments adopted in the EP Plenary but concerns remain
regarding the switching/porting provisions which do not appear to recognise the need for greater
flexibility when porting greater volumes in the case of corporate customers.
Open Internet
We agree with the principles of an open internet, though not the choice of legal instrument, proposed by the
Commission, preventing anti-competitive blocking and providing transparency, but allowing reasonable
traffic management and innovation. We believe, though, that national authorities should have greater
flexibility [Arts 23.1, 25.1, 25.2, 25.4] to maintain self-regulatory mechanisms where these already meet the
policy objectives and to avoid overly prescriptive detail which, being based on the internet of today, risks
inadvertently restricting the innovations and consumer benefits of tomorrow.
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We do not support the amendments adopted in the European Parliament Plenary vote, which are overly
restrictive and which raise legal uncertainty (on eg definitions of ‘internet access service , ‘specialised
services’) . The wording previously agreed by the European Parliament ITRE and IMCO Committees
(CA4A), provided a more workable and balanced solution, based on pragmatic principles (no anticompetitive blocking/throttling, but allowing reasonable traffic management and innovation).
Transparency and Provision of Information
The need to provide full information to end-users is self-evident but the articles need changing to ensure the
information provided is:
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useful and meaningful (ie actually informing user choice);
correctly targeted (consumers have different needs to business users);
addresses an actual problem (Recital 56 identifies discrepancies of advertised and actual speeds but
the implementing articles are far more sweeping in their scope);
actually workable (the definition of ‘actually available data speed’[Art 25.1], which in the proposal is
impracticable, and aspects of the ‘consumption control’ provisions [Arts 27.1, 27.2]);
appropriate (eg ‘bill-shock’ does not appear to be an issue for fixed providers but they are subject to
the same proposals [Art 21.3]).
We broadly support the vote in the European Parliament Plenary, which addresses many of the above points
Contract Termination
The contract termination provisions appear to be based on consumer needs but again have impacts on
business customers which are not appropriate. The proposal for a six-month break point [Art 28.2] without
compensation is a significant departure from the careful balance of consumer and supplier interests in
commonly accepted contractual practice. Customers typically benefit from lower prices when committing to
longer terms, as companies can recover costs over a correspondingly longer timeframe. Allowing early
termination without compensation will remove business incentives to offer reduced prices, to consumers’
detriment.
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We broadly support the vote in the European Parliament Plenary , which addresses many of the above
points
Innovation, Choice, Competition and Flexibility
We welcome the proposal in Parliament to move the User Rights elements to a Directive. Overall, the use of
a Regulation as the legal instrument (rather than a Directive or Recommendation) risks impeding innovation
in some cases, by restricting providers’ ability to make different offers available (for example in the case of
contract specifications). By imposing extra obligations on providers, but without the supporting evidence of
current problems and/or anticipated end-user benefit, the Regulation will reduce competitive differentiation
while at the same time potentially increasing prices. The use of a Regulation also actually increases
uncertainty in some of the areas already mentioned, and we therefore propose that some points of detail
are explicitly left to national authorities to interpret, within a strongly articulated set of policy objectives, to
allow correct alignment with national markets. There is otherwise a real risk that the advantages of highly
competitive broadband markets, such as the UK’s, will be eroded to the detriment of the whole internet
value chain and especially end-users.
BT Group plc 07/04/2014
BT is one of the world’s leading communications services companies, serving the needs of customers in the UK and in more than 170
countries worldwide.