IHS Global Insight Perspective | |
Significance | The European Commission has sent a formal notice to Romania over the independence of the local telecoms regulator, ANC. |
Implications | Romania's previous ruling government, ousted in November 2008, dismissed two regulatory chiefs by imposing emergency legislation, thus violating the body's independence from politics and undermining the transparency of the Romanian telecoms market. |
Outlook | The letter of formal notice is the Commission's second step in solving the problem, involving an initial legal assessment. The new government is likely to be rather co-operative, yet it remains to be seen whether it will have what it takes to push through any actual reforms to tackle the core problem: the ANC's lack of independence from ruling politicians. |
The European Commission has said in a press release that it has launched an infringement case against Romania over a serious violation of the independence of the national telecoms regulator (ANC, previously ANRCTI). The Commission opened procedures by sending a letter of formal notice, under Article 226 of the Treaty establishing the European communities, to the Romanian government after finding its responses to two administrative letters, sent on 19 September and 14 October 2008, unsatisfactory.
Telecoms Commissioner Viviane Reding said on the issue that "independent regulators are the backbone of the EU telecoms rules and are therefore central to fair regulation in Europe's single telecoms market", adding that "it is worrying to see the government of an EU member state nullifying in 2008 the effects of a court ruling, particularly as it is not the first time this has happened in Romania".
Outlook and Implications
- Staffing Matters: The case dates back to August 2008 when the Romanian telecoms authority was still called ANRCTI and the centre-right government of Calin Popescu-Tariceanu—then prime minister—was still in power. After accusing the ANRCTI's president, Dan Georgescu, of "serious infringements of ICT law", the government removed him from office; however, Georgescu appealed against the decision in court, which ordered a temporary suspension of the dismissal. On the same day, the government imposed emergency legislation that dissolved the ANRCTI altogether. Beefed up with certain new responsibilities, the organisation was restructured practically overnight and renamed as the ANC. This allowed the government to appoint a new person, Liviu Nostoran, to take over the agency's top job (see Romania – Europe: 22 September 2008: Romania Dissolves Telecoms Regulator, Faces EU Inquiry). It was the second time this had happened under Popescu-Tariceanu—the first re-staffing through emergency ordnance saw Georgescu take over from Ion Smeeianu in 2006
- The Procedures: The administrative letters written by the Commission to Romania in September and October 2008 are informal in their nature and meant to be pre-emptive in terms of infringement procedure. According to EU law, these kind of complaints can be lodged by any person or body together with the Commission. If the problem in question is not solved, the next step is the Commission's letter of formal notice, which involves an initial legal assessment and an invitation to the member state to present its own views regarding the facts. If the Commission receives no response or finds the response unsatisfactory, it issues a reasoned opinion expressing its view that an infringement exists and asking the country to remove it within a specified time limit. If the reasoned opinion does not solve the problem, the Commission may refer the case to the European Court of Justice, thereby launching actual legal action.
- New Government, New Preferences? Popescu-Tariceanu and his cabinet, including former telecoms minister Karoly Borbely, were voted out in the November 2008 general election and Romania is now ruled by a centre-left coalition, led by Emil Boc. The minister responsible for the telecoms sector, Gabriel Sandu, has taken a noticeable step back from some of his predecessor's decisions, particularly over the further privatisation of the local fixed-line incumbent, and the role and responsibilities of the regulator (see Romania: 13 January 2009: New Telecoms Minister Says Romtelecom's IPO Not a Priority). IHS Global Insight expects Sandu's stance over this particular issue to be accordingly co-operative towards the Commission, yet it remains to be seen how inclined he will be to tackle the real source of the problem—i.e. ruling politicians not keeping their hands off the organisation. As Reding also points out in the press release, "the issue is not this or that person, but that long-term, stable solutions are found to secure the independence of whoever is at the helm of the regulator".