Wholesale Providers of Broadband Set to be Spared From Stricter EU Regulation

Under a deal that was provisionally agreed this week, the wholesale service providers of broadbands will be spared from heavier regulation of the European Union on the prices at which they give other operators access to their networks.

The member states of the European Union and the European Parliament are in the middle of discussions regarding an overhaul of the telecoms rules of the bloc with the aim of boosting the investment in superfast broadband.

The executive body of the European Union, the European Commission, had originally proposed a lighter regulatory model for the wholesale-only providers of broadband who do not offer the consumers their own retail broadband packages, such as the Open Fiber of Italy and a joint venture between Vodafone and the Electricity Supply Board of Ireland called Siro.

According to an internal parliamentary note that was seen by Reuters, the proposal was aimed at urging more companies to adopt the wholesale-only model. It was agreed during the negotiations last Wednesday. However, the agreement will only become final once a deal is finalised on the whole package.

According to the text of the deal that was seen by Reuters, the wholesale providers of broadband will be exempt from the majority of the obligations that regulators normally impose on dominant telecoms providers. The regulators will only be able to impose the obligations on “fair and reasonable pricing” once justified by a “market analysis.”

Telecoms companies including Deutsche Telekom, Telefonica, and Telecom Italia have argued that the current rules that are requiring them to open up their networks to competitors at regulated prices do not enable them to receive a return on their investment.

The Commission suggested easing the rules where companies agree to co-invest in new networks together. However, the European Parliament and its member states are still attempting to reach a compromise.

Lawmakers in the European Union want to make sure that a co-investment agreement has actually been achieved before easing the regulation.