Welcome to our Communications & Competition newsletter – a place where we collate the most interesting developments for the communications sector and the latest key competition law developments. If you’ve been forwarded this newsletter by a colleague and would like to subscribe, please click here.

If you would like to discuss any of the developments covered in this newsletter or on Communications and Competition law matters more generally in relation to your business, please don’t hesitate to get in touch with our team.

We have a busy communications and competition law year ahead. Several key updates have just been published including on the Competition and Market Authority’s (CMA) new and evolving role, with a consultation on updating the guidance for horizontal agreements as well as the establishment of the Subsidy Advisory Unit (SAU) given effect by the new Subsidy Act 2022. The CMA has also seen its decision to investigate mobile browsers and cloud gaming challenged by Apple.

Ofcom has published its consultation document setting out its provisional conclusions regarding Openreach’s latest Equinox 2 offer. Ofcom’s provisional view is to allow the latest offer to go through and therefore not to intervene; the consultation window ends 4^th March 2023. Ofcom has also seen significant investigation and enforcement activity: closing its investigation on silent calls, opening an investigation into BT’s compliance with its General Condition (GC) obligations and the update to its Regulatory Enforcement Guidelines. The regulator has also been busy with new licensing regimes, issuing guidance on the licensing and regulation of Unmanned Aircraft Services (UAS) as well as commercial drone services.

Both the UK Government and Ofcom have also been active in the Online Safety space, with Government issuing guidance to the Online Safety Bill and Ofcom recently consulting on risks of harm to children online and the mitigation of harm.

Finally, we’re pleased to announce the launch of the website for our latest product, Riagla. Riagla helps clients cut through the noise of regulatory change by delivering commercially relevant, actionable data to help professionals understand how to prioritise an ever-increasing volume of information. Take a look and let us know if you have any feedback or questions.

European Commission adopts common position on AI Act

On 6 December 2022, the European Commission approved the next version of the Artificial Intelligence (AI) Act. The main changes to the Act include: narrower scope of AI definition to exclude traditional software; extension of AI prohibited practices including social scoring ban to private sectors; classification of high-risk categories based on the system’s decision-making process impact; quality and detailed technical documentation requirements on high-risk systems; support for innovation including possibility of setting up regulatory sandboxes to establish controlled environment for the development of AI systems; and greater autonomy to the European Artificial Intelligence (EIA) Board to assist the Commission and member states on the application of the Act. To find out more, click here.

EU Foreign Subsidies Regulation enters into force

On 12 January 2023, the EU’s Foreign Subsidies Regulation (FSR) came into force. Prior to the FSR, there were concerns over the potential distortion of competition that arose due to subsidies from third countries not being subject to the European State aid regime. The main changes that the FSR implements are the introduction of a mandatory pre-closing notification and review procedures for M&A transactions and JVs that meet certain financial thresholds, a new notification system for companies which receive foreign financial contributions that are looking to bid for large public tenders, as well as new powers for the Commission to launch investigations ex-officio into any other foreign subsidies they see may pose competition risks, where they are not caught by the preceding notification requirements. A draft Implementing Regulation, which will clarify the applicable rules and procedures, is set to be published within Q1. Stakeholders will have 4 weeks to provide feedback once published. The FSR is then set to apply from 12 July 2023, with the notification obligations commencing from 12 October 2023 for the Commission’s review. To find out more, click here.

Horizon scanning in a post-pandemic world

We recently commissioned OMC Partners to examine the measures organisations have in place to horizon scan and monitor the exponential growth in regulations impacting their operations. Amongst the backdrop of the pandemic, sanctions and Trump-era populism, we wanted to know what new priorities compliance leaders are grappling with, and how solutions are evolving. The final report makes interesting reading for anyone tasked with keeping on top of the ever-changing regulatory environment: To find our more, click here.

Openreach published and notified Ofcom of its latest wholesale FTTP price offer, ‘Equinox 2’

Equinox 2 amends and supplements Equinox 1 by introducing further discounts, as well as new terms and discounts. Find out more about the offer here.

Ofcom has now published its consultation on Equinox 2 with its provisional conclusion on the offer and its anti-competitive effects contained therein. As we reported in our insights article (here), Ofcom has analysed the FTTP rental price levels and the conditionality of the Order Mix Targets to see whether there is in its view a material risk to competition. Ofcom’s provisional conclusion is that there is no such material risk which would require it to intervene to stop the offer, therefore proposing to let it through. The deadline for industry response to the consultation is 4^th March 2023. To find out more, click here.

BEIS announces review of Economic Regulation

Following the economic regulation policy paper published in January 2022, BEIS announced the review of economic regulation of the energy, water and telecoms sectors. The key purpose of the review is to update and strengthen the legal framework through reviewing the regulator’s duties; regulators to enhance competition and innovation; and reviewing transparency and consistency in key processes and methodology that regulators use to control prices. A consultation is to be launched later this year setting out more detailed package of measures. To find out more, click here.

Ofcom investigates BT’s Customer Contract Information

On 23 January, Ofcom opened an investigation into BT’s compliance with their Contract Information and Contract Summary obligations. Ofcom is looking into whether BT has contravened GCs C1.3 to C1.7 and C5.16 because of suspected breaches by its subsidiaries EE and Plusnet. Their focus is on enabling all customers to make informed choices about the services they are being offered. To find out more, click here.

Ofcom licences commercial drone services from January 2023

In June 2022 Ofcom launched a consultation process proposing a new licensing regime for unmanned aircraft systems (UAS) granting spectrum rights for essential drone safety and communications (the Licence). Following Ofcom’s announcements in December 2022 regarding the outcomes of the consultation, on 20 January 2023 Ofcom began accepting Licence applications and issued updated guidance on how to apply for the Licence. To find out more, click here.

Ofcom consults on Proposed Template Notices resulting from Product Security and Telecommunications Infrastructure Act 2022 amendments to Electronic Communications Code

Ofcom is consulting on the form of two notices Ofcom is required to prescribe following amendments to the Electronic Communications Code made by the Product Security and Telecommunications Infrastructure Act 2022. These notices relate to the upgrading and sharing by an operator of apparatus situated under privately-owned land and are required to be given by the operator before the operator begins to upgrade the apparatus or share its use. The deadline for responses is 6 March 2023. To find out more, click here.

Ofcom sets out it expectations of mobile providers during 3G and 2G switch-off

Mobile network operators have agreed with Government to switch-off their 2G and 3G networks, with each operator having its own timetable for switch-off. Switching off these networks will free up spectrum for 4G and 5G networks. Ofcom has now set out how it expects mobile providers to approach implementing the switch-off of their services to ensure that its consumer-focussed objectives are met. To find out more, click here.

UK Draft Roaming Regulation with Norway and Iceland

The UK government has published its draft Trade (Mobile Roaming) Regulations 2023. The overarching purpose of the Regulations is to regulate international mobile roaming wholesale charges between the UK and Norway, and the UK and Iceland. It meets the obligations that the UK signed up to in the Free Trade Agreement (FTA) with Norway, Iceland and Liechtenstein on 8 July 2021. Liechtenstein opted out of this aspect of the FTA due to its operators’ commercial relationships with Switzerland. The Regulations only introduce a cap on the wholesale element of the charges and will not have impact on the retail charges that customers pay when travelling abroad. The Regulations were approved by the House of Lords on 1 February 2023. To find out more, click here.

UK Government publishes interception of communications Code of Practice 2022

The UK government has updated the interception of communications code of practice. It reflects changes in the law since the code entered into force in 2002 and provides additional information on the safeguards that apply to the security and law enforcement agencies’ exercise of interception powers. To find out more, click here.

Ofcom updates its enforcement guidelines

Ofcom has published a statement on its approach to enforcement, revising its Regulatory Enforcement Guidelines. The Guidelines set out how Ofcom will approach the enforcement of regulatory requirements and consumer protection law for the industries it regulates. The Guidelines have been amended to cover Ofcom’s enforcement activity in three new areas:

• obligations placed on video sharing platforms under Part 4B of the Communications Act 2003;
• requirements imposed on operators of essential services for the digital infrastructure subsector under the Network and Information Systems Regulations 2018; and
• the revised framework for protecting the security and resilience of telecoms networks and services in the UK as set out in the Telecommunications (Security) Act 2021.

To find out more, click here.

Ofcom closes silent and abandoned calls enforcement programme

In January 2023, Ofcom closed its enforcement programme into silent and abandoned calls which was ongoing since 2006. During Ofcom’s work on this, Ofcom contacted eleven communications providers whose numbers appeared to be generating high levels of consumer harm and as a result, the numbers were withdrawn from companies generating nuisance calls. Overall number of complaints related to silent and abandoned calls decreased 65% since 2016. To find out more, click here.

CMA opens Consultation on draft horizontal agreements guidance

On 25 January 2023, the UK’s Competition and Market Authority (CMA) opened a Consultation on their draft guidance relating to how Competition law rules on anti-competitive agreements apply to horizontal agreements. The deadline for responses is 8 March 2023. To find out more, click here.

New UK Subsidy Control Regime enters into force

The new UK Subsidy Control Act 2022 came into force on the 4 January 2023. The new Act provides a framework for the provision of subsidies, building on previous State Aid rules and the control chapters of the Trade and Co-operation Agreement. The new Act sets out what types of financial assistance are included within the scope of a ‘subsidy’ and what types of subsidies are prohibited. As well as defining the legal process for appeal and review, the Act also establishes the role of the Subsidy Advisory Unit (SAU) which will sit within the Competition and Market Authority (CMA). To find out more, click here.

Apple Challenges the CMA’s decision to investigate mobile browsers and cloud gaming

Apple has launched an appeal in relation to the CMA’s Market investigation reference (announced at the end of Nov 22) on cloud gaming and mobile browsers.  Apple argues that the CMA has failed to comply with procedural timelines when making the reference and the appeal will be heard by the Competition Appeals Tribunal on Friday, 10 March. To find out more, click here.

Government Guidance to Online Safety Bill

The Government has published its guidance on the Online Safety Bill. The guidance details how the Bill intends to protect both child and adult users, the steps that will be taken to regulate and remove content and how the Bill will be enforced against relevant companies. To find out more, click here.

Call for evidence: Second phase of Online Safety Regulation

On 10 January 2023, Ofcom published a call for evidence for the second phase of its Online Safety Regulation. The call for evidence will inform its wider consultation expected to be published in autumn 2023. The focus of that consultation will be protecting children from legal but harmful content and will include draft guidance to assist services in complying with their children’s access assessment duties, draft guidance about how services likely to be accessed by children can comply with their duties to undertake their children’s risk assessment and draft codes of practice explaining how services can comply with their safety duties relating to protecting children from harmful content. The call for evidence is specifically seeking evidence on risks of harms to children online and how they can be mitigated in order to inform these drafts. To find out more, click here.

Government publishes voluntary Code of Practice for app store operators and app developers

The Government has published a voluntary Code of Practice for app store operators and app developers. The Code follows a public consultation on app security and privacy interventions that was launched in May 2022, in which most respondents supported the principles within the Code of Practice.  The Code creates a number of principles with regards to app functionality, sharing information with consumers and transparency over app approval procedures. To find out more, click here.

Ofcom publishes economics discussion paper on data, digital markets and refusal to supply

Ofcom has published a paper on data, digital markets and refusal to supply, acknowledging the demanding legal criteria which must be met in order for a refusal to supply by a dominant company to be considered a competition law infringement. The paper poses the question of whether these criteria are still appropriate in the context of digital markets. To find out more, click here.

UK Court of Appeal to decide whether existence of fiduciary or tortious duties owed by blockchain developers to owners of digital assets held on such networks is a “serious issue to be tried”

Tulip Trading (TTL) v Wladimir van der Laan & Ors was heard in December 2022 before the UK Court of Appeal (COA). The COA must now decide if the High Court in Tulip Trading v Bitcoin Association & Ors (25 March 2022) (the High Court case) was correct in holding that there is “no serious issue to be tried” regarding whether Bitcoin’s software developers owe a duty to Tulip Trading Limited (TTL) to assist in recovering bitcoins that were stolen in a computer hack. The COA’s decision is expected later this year. To find out more, click here.

Information Commissioner’s Office publishes Tech Horizons Report

ICO’s Tech Horizons Report examines key emerging technologies and implications on data privacy. The ICO encourages businesses to consider privacy at an early stage and ensuring services are data compliant, considering principles such as transparency and control of subjects over their own data, as consumers are most likely to adopt new technologies that are committed to handling their information securely. To find out more, please click here.

European Electronics Communication Code (EECC) Tracker

For the latest update on the varied implementation of EECC we are observing across the UK and in the EU/EEA, please see our latest European Electronic Communications Code tracker – which provides an at-a-glance view of implementation as well as a detailed summary of the current status for each territory. To find out more on any of the above updates or other communications provider requirements please get in touch.