Jerker Torngren

Competition in South East Europe

Benefits are the same for all countries

Challenges might differ from country to country

Jerker Torngren

Why a reform?

WTO commitments EU membership The welfare of the citizens

Jerker Torngren

WTO obligations

Depends on commitments made by the country

As a EU Member, the country must adhere to commitments made by the EU

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Obligations to the EU

Accession countries are committed to implement all EU legislation.

EU does not accept any special or exclusive rights within electronic communication

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The welfare of the citizens

The reform must be implement for the sake of the country, not primarily because of international commitments.

Citizens’ welfare is the objective behind the EU policy

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Citizens’ welfare

Economical reasons For the private economy For private business Economic growth

Social reasons Private contacts Access to information

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The objective of the reform

The reform must be based on the determination to improve the situation in the country, rather than fulfilling international obligations.

Only a well defined objective can safeguard a successful implementation.

It is the implementation that counts.

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Challenges

Regulatory

All the “BUTs” These are often by far more difficult to deal with than the

regulatory challenges

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Some regulatory challenges (1)

Any country planning to become a member of EU

must focus on the EU legislation.

Problems for accession countries with the new EU package

EU has spent 10 years of gradual evolution

But note,

New package is an evolution of previous legislation, not a replacement as such.

Jerker Torngren

Some regulatory challenges (2)

Definition of relevant markets

(art 15 Framework Dir)

The Directive prescribes cooperation with Member states and the Commission, a cooperation that is not formally open to non-Members.

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Some regulatory challenges (3)

USO

EU Directive puts obligations on Member States

but Includes also restrictions on how to deliver.

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USO, continuation

How to put the needs of the individual country into the context of the EU legislation

Remember:

A universal service scheme by itself does not drive economic development. It prioritises the available funds for network development to achieve social goals rather than economic goals. This policy can be in conflict with the objective of economic growth.

Jerker Torngren

Other Potential Challenges, the ‘BUTs ‘

Economical interest Political interests Lack of understanding Fear of unemployment Bureaucracy at national level Bureaucracy at local level Corruption. Lack of experience ‘What is competition? Never heard of that” “Will not work.” “Network will collapse” “New entrants are not interested in good services” Lack of capital No risk capital “Might loose my job” “Might loose my influence”

An unlimited list of relevant and irrelevant arguments, often never publicly expressed

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Important to realise that;

Incumbents in South East Europe normally have a different position and role compared to former incumbents in US or some EU Member states.

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In addition weak economies

Economical interests in existing structure Political problems with rebalancing of tariffs Overstaffing within incumbent can result in

unemployment The employment gains through new

investments are not taken into account

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In addition:

Bureaucracy in all levels of society

Misguided trust in regulating technical issues

Corruption is still a deterrent to investments

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Potential conflict of interest

Economical growth is a relatively long term perspective

Versus

Incumbent providing source of income to the State, today

But has the present situation created welfare for the citizens?

Jerker Torngren

Conclusion

Introducing competition is Difficult But Necessary, not primarily to please

EU, but necessary for any country that wants to develop and improve the situation for its citizens

Implementation counts, not the policy as such