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.

The month ahead looks increasingly busy for the industry, with further engagement on a number of UK consultations and reviews, as well as increasing pressure to deliver a One Touch Switching solution for broadband services in time for the 3^rd April deadline.

One key area of focus for the UK telecoms industry is Ofcom’s recent publication of its highly anticipated initial views on Openreach’s Equinox 2 FTTP price offering, in which it provisionally found no reason to intervene and stop the offer from going to market. We have also seen renewed activity in the retail broadband space, with an increasing focus on consumer protection measures including a proposed review into in-contract prices and most recently a proposed review in the point-of-sale and contract information practices of operators when it comes to distinguishing between fibre and non-fibre services.

Gigabit Act proposal and recommendations

The European Commission (EC) has recently published three separate legislative proposals and recommendations with the intent of promoting the deployment of Very High Capacity Networks (VHCNs). To find out more, click here.

The three publications are:

1. Gigabit Infrastructure Act (find out more here)
2. Gigabit Recommendation (find out more here)
3. Exploratory Consultation on the Future of the Connectivity Sector and its Infrastructure (find out more here).

Negotiations on AI Act

EU lawmakers met for a ‘marathon’ negotiation session on the AI Act. Proposals to amend the draft include: banning on social scoring has been extended to include private entities; downsizing of AI office role; regulatory sandboxes to guide and supervise high-risk AI systems when exiting the sandboxes; high-risk AI systems testing to consider intended purpose and foreseeable misuse; and establishing mutual recognition agreements with foreign countries with comparable conformity assessment levels. To find out more, click here.

Cyber Resilience Act interplay with the AI Act

The draft Cyber Resilience Act (CRA) is a legislative proposal to introduce baseline cybersecurity requirements for connected devices. The Act is set to interplay with AI legislation as systems considered at high risk of causing harm will be considered to comply with the AI Act’s cybersecurity requirements if they respect the essential requirements listed in the draft Cyber Resilience Act and demonstrate that with an EU declaration of conformity. To find out more, click here.

EU Parliament adopts draft Data Act

The EU Parliamentary Committee for Industry, Research and Energy has adopted the text of the Data Act, which aims to boost innovation by removing barriers to consumers’ and businesses’ access to data. The EU Parliament says that the draft legislation would contribute to the development of new services, in particular in the area of artificial intelligence, where huge amounts of data are needed for algorithm training. It will also lead to better prices for after-sales services and repairs of connected devices. To find out more, click here.

Green Deal Industrial Plan

The European Commission has published its Green Deal Industrial Plan: putting Europe’s net-zero industry in the lead. The plan aims to enhance the competitiveness of Europe’s net-zero industry and support the fast transition to climate neutrality. The first pillar of the plan is about a simpler regulatory framework. The Commission will propose a Net-Zero Industry Act to identify goals for net-zero industrial capacity and provide a regulatory framework suited for its quick deployment. This will be complemented by the Critical Raw Materials Act, which aims to ensure sufficient access to  materials, like rare earths, that are vital for manufacturing key technologies. To find out more, click here.

Project Gigabit Winter Update 2022 to 2023

The Project Gigabit ‘Winter Update’ was published this month, drawing attention to the recent success of the programme. The latest awards for the Cumbria, Central and South West Cornwall lots saw altnets take a clean sweep of the supplier contracts. With procurements expected to gather speed, alongside the implementation of the new Subsidy framework, the space is likely to be a busy and complex period for operators and Government alike. To find out more, click here.

Four new government departments created

The PM has announced that four new government departments have been created. These are: the Department for Energy Security and Net Zero, which is created to secure a long-term energy supply; the Department for Science, Innovation and Technology, which will be focused on turning scientific and technical innovations into practical, applicable solutions; the Department for Business and Trade to support growth, promote investment and champion the free trade of British businesses; and the Department for Culture, Media and Sport (which is a refocused version of its predecessor) to help make the UK a global leader in the creative arts. To find out more, click here.

Openreach proposed FTTP offer consultation

Ofcom published its consultation concerning Openreach’s ‘Equinox 2’ FTTP pricing offer. Ofcom sets out its initial assessment of the offer and provisionally finds no reason for it to intervene. The consultation was open until 4th March 2023. Ofcom has delayed its final decision on Openreach’s Equinox 2 FTTP offer for a further two months to allow it time to analyse the responses. This delay does not guarantee Ofcom will intervene and may still lead to legal appeals from both sides. Stakeholders will need to engage with Ofcom during this period to ensure their concerns are heard. Our insight report summarises the different industry reactions, with the altnets on one side concerned by both the anti-competitive effects of the offer and precedence this sets for future offers, and on the other side the ISPs welcoming the drop in their wholesale costs. To find out more, click here.

BT quarterly financial report

The latest BT Quarterly results show strong financial and operational performance for the network and service provider in a time when industry is reacting to tough economic conditions (here, and here). The market structure is evolving, with the wheels of consolidation in motion for some operators (here, here and here).

Ofcom review of inflation-linked telecoms price rises

Ofcom announced its review into inflation-linked retail broadband price rises, following preliminary research which shows that about one-third of mobile and broadband customers do not know whether their provider can increase their price. Whilst its clear Ofcom will look at “whether tougher protections are needed”, it is unclear what form this will take as Ofcom “does not set retail telecoms prices”. To find out more, click here.

Ofcom’s open letter to OTS implementation

Ofcom has published an Open letter it recently sent to the industry steering group for OTS implementation, in which Ofcom reiterated its expectation that operators should be ready to implement and comply for its 3rd April 2023 deadline. This is despite the fact – which it notes in the letter – the hub solution for OTS will not be ready in time for the deadline. In the increasingly likely event providers are not fully compliant with the relevant GCs regarding OTS implementation, Ofcom has said it will consider whether any enforcement action is appropriate. To find out more, click here.

Ofcom fines Sepura £1.5m for breach of UK competition law

Ofcom published the non-confidential version of its decision to fine Sepura £1.5m for a breach of UK competition law. For context, Ofcom recently found both Sepura and Motorola had exchanged competitively sensitive information related to a procurement exercise for the provision of emergency service TETRA devices. To find out more, click here.

UK merger control 2023

Sarah Cardell, Chief Executive of the CMA, gave a speech at the UK Competition Law Conference where she covered the topic of UK merger control. In related news, the CMA has provisionally approved Viasat’s acquisition of Inmarsat, two major global satellite communication and broadband operators. To find out more, click here.

Draft guidance on environmental sustainability agreements

The CMA is consulting on draft guidance on the application of the Chapter prohibition in the Competition Act 1998 to environmental sustainability agreements between businesses operating at the same level of the supply chain. To find out more, click here.

CMA’s market investigation in respect of the supply of the land mobile radio network services for public safety

The CMA has published recent submissions made to it in response to the provisional findings against Motorola. Last October, the CMA provisionally found there were competition concerns with the way Motorola was providing mobile radio network services to the emergency services. The final report is now expected next month. To find out more, click here.

Product Security and Telecommunications Infrastructure Act

The Product Security and Telecommunications Infrastructure Act 2022 (Commencement No 1) Regulations 2023 (SI 2023/109) (Commencement Regulations) were made to bring into force provisions in the Product Security and Telecommunications Infrastructure Act 2022 (PSTIA 2022) that amend the electronic communications code (Code) set out in Schedule 3A to the Communications Act 2003. The regulations widen Code rights for telecommunications operators to share electronic communications apparatus with other operators and for upgrading and sharing rights in relation to that shared apparatus; give automatic rights for operators to upgrade and share underground existing infrastructure installed before the 2017 Code; and provide a new power to fly lines from apparatus kept by another operator and related rights to upgrade, or carry out works to, such apparatus. To find out more, click here.

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.