Though digital priorities, including the Digital Networks Act, appear set to be redeemed from the role of the “forgotten twin”, the direction of telecoms regulation reform is still uncertain
EC President von der Leyen unveils ranging (and potentially fragmented) tech and telecoms policy priorities for the incoming Commission
On 17 September 2024, the EC published President Ursula von der Leyen’s mission letters to the nominees to the new College of Commissioners for the 2024-2029 term. Per the priorities set out for the Commissioners-designate in each letter, tech and telecoms policy items will be split across at least seven different portfolios. While this breadth does reflect a wider and deeper priority on the digital transition, previously referred to as the “forgotten twin” in the EU’s twin green and digital transition, this arrangement could complicate the bloc’s work to formulate a cohesive regulatory agenda and industrial strategy to grow the digital economy. Some notable changes to the previous (2019-2024) Commission's slate of assignments – including the division of digital and competition matters into two portfolios and the reassignment of new telecoms legislation from the single market and industrial policy to the tech-centric brief – have already drawn criticisms from MEPs across the political spectrum.
Telecoms priorities, including a potential Digital Networks Act, are on course for conflict with the Hungarian Presidency
Given the references to the Letta and Draghi reports in all of the mission letters, it is unsurprising that Henna Virkkunen (EVP-designate for Tech Sovereignty, Security and Democracy) has been tasked with the development of a much anticipated Digital Networks Act (DNA). Taking over the mantle from former Commissioner for Internal Market Thierry Breton, she will be charged with the work of incentivising investment in telecoms networks while taking into account the varied responses to the EC’s digital infrastructure white paper. Ex-Orange CEO Breton’s departure could conversely prove advantageous to supporters of the DNA, as Virkkunen will lead as a figure less closely affiliated with the interests of former incumbent operators. Though the inclusion of the DNA suggests some momentum behind reforming telecoms regulation, the ongoing work of the Hungarian Presidency of the Council of the EU to respond to the EC’s white paper could be cause for pessimism. The Council’s response paper is expected to recommend that the bloc complete its 2025 review of the European Electronic Communications Code (EECC) before it considers modifications to the ex-ante regulation or work on a shift to ex-post enforcement. The mission letter addressed to Teresa Ribera Rodrídguez (EVP-designate for Clean, Just and Competitive Transition) again offers cause for optimism for operators given her responsibility to develop a new approach to competition policy, which supports firms scaling up to achieve global competitiveness. She will be further tasked with reviewing the Horizontal Merger Control Guidelines to ensure resiliency, efficiency and innovation are afforded adequate consideration, mirroring suggestions in the EC’s white paper that telecoms merger reviews need to better account for investment and innovation as regulatory objectives. Again, however, the shifting positioning of the Hungarian Presidency may conflict with this assessment, as the Council of the EU’s response to the white paper is expected to remove any reference to consolidation and instead champion competition as the primary driver of investment in telecoms infrastructure.
Despite a number of tech-related legislative proposals, implementation is still likely to rule the day
Despite the prior billing of the incoming Commission's tech mandate as an effort of implementation, the mission letters also include a number of legislative proposals related to the digital economy, including:
EU Cloud and Cloud Development Act, assigned to Virkkunen;
Digital Fairness Act, assigned to Michael McGrath (Commissioner-designate for Democracy, Justice and the Rule of Law);
Regulation to prevent and combat child sexual abuse, assigned to Magnus Brunner (Commissioner-delegate for Internal Affairs and Migration);
Critical Raw Materials Act, assigned to Stéphane Séjourné (EVP-designate for Prosperity and Industrial Strategy); and
EU Space Law, assigned to Andrius Kubilius (Commissioner-designate for Defence and Space).
These proposals will contribute to, rather than rewrite, the EU’s digital rulebook, filling gaps related to e-commerce protections and child safety online that have emerged since the adoption of earlier laws. The ongoing implementation of the Digital Services Act and Digital Markets Act, which feature in Virkkunen’s portfolio, are likely to remain the central talking points for tech policy. Given the recent efforts by tech firms to lobby for the rollback or limited enforcement of these laws along with the AI Act and GDPR, including in an open letter led by Meta and joined by Spotify and Ericsson, any suggestion of a shift in the EC’s direction on enforcing its digital rulebook would be met with great interest.
