Draft telecoms regulations may not be in line with EU directives

by David Kelleher

The debate on the future of the telecommunications industry in Malta appears to be heading for a huge showdown following the release of the draft regulations for Internet and other data network service providers.

The draft regulations, which still have to be published, have raised the ire of the local ISPs who described them as a joke. Telecoms experts also believe that the regulations are not in line with EU directives.

Industry sources, asked to comment on the draft regulations, told The Malta Business Weekly that the authorities tried to simulate or emulate what is being done in other countries.

"What has not been taken into consideration is the fact that regulations abroad are based on a scenario with more than one cable company. In each case, that company does not have nationwide access. Nowhere in Europe, and possibly in the world, does one cable company provide for the entire nation, except for Malta," the sources said.

They added that the regulations drawn up by the government for Malta are not acceptable because they are not related to what is actually happening locally.

The regulations, if approved, will mean that any Transport Service Provider - of which Malta has four: Maltacom, GoMobile, Vodafone and Melita Cable - will have to open their networks to other operators.

In simple terms this means that if for example Melita Cable start offering Internet via Cable, this service should also be available to the ISPs.

However, this will only occur if the company in question has a dominant position in the market. According to the draft regulations, this means that: "A Telecommunications Transport Provider (TTP) providing services through a subsidiary company shall be presumed to have a dominant market position when the said company has more than 25 per cent of the market for the services or when the Telecommunications Service Provider has more than 25 per cent of the telecommunications transport market in respect of the services in the geographical area within which it is authorised to operate. The said percentage shall be based on the operator's percentage of the gross revenues in the particular market."

Sources close to the ISPs however are adamant that the regulations only serve to strengthen the position already had by the TTPs.

"ISPs also want the government to declare that Melita Cable has a dominant position as a telecoms transport provider. Only then will they be satisfied," the sources said. Industry analysts told The Malta Business Weekly that the same draft regulations would not be accepted on all fronts by Brussels. "These regulations would not be accepted by Brussels. If they had to be vetted to see whether they would fall in line with the EU directives, the regulations would not be accepted," the industry analysts said.

"Even if Brussels had to change certain clauses or not accept the draft regulations in their entirety, the government would not be obliged to change its mind.

"Then again, such a move would deduct a few marks for Malta. Unfortunately, Malta's position paper on telecommunications does not give a true picture of how things are done here, so Brussels may not be aware of certain matters," the sources added.

Contacted by The Malta Business Weekly, the Minister for Communications, Censu Galea, said that the draft regulations had been given to the parties concerned and they had up till last week to give in their comments.

"As we have not received feedback from everyone we have extended the deadline till 1 September, that is tomorrow," Mr Galea said.

He added that while open access was one issue that was being discussed there were other points that were of importance and were of benefit to the ISPs.

Asked when the regulations will be published, Mr Galea said they would be published on 1 September. Industry analysts, however, feel that there is little chance that a solution will be found and that a final decision will be taken by someone other than the Minister.

Even then, sources told The Malta Business Weekly that the industry was in for another hot season... a long hot season.

"The debate is not going to stop here. The ISPs have remained quiet but not for long," the sources added.