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What is the digital internal market and where the European Union should intervene?

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  • Philippe Defraigne
  • Alexandre de Streel
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    Abstract

    This paper analyses the digital internal market and when EU intervention is needed to achieve this internal market. It sets legal and economic criteria to determine the appropriate scope of the EU intervention. It applies these criteria to several case studies and concludes that sometimes the EU intervention is not justified (choice of regulatory remedies in many national markets, regulation of mobile termination rate, price control of Next Generation Access networks), whereas in other cases EU intervention is justified (entry regulation, international roaming, spectrum). The paper calls for a more open debate of the concept and the means to achieve the digital internal market. It also submits that EU intervention should focus on the areas where its benefits are the highest (in particular given the possibilities of economies of scale provided by the technology or the cross-country externalities), and where its costs are the lowest (in particular given the heterogeneity of national preferences or the need for regulatory experimentation and competition). Therefore, EU intervention is more relevant for the content part of digital regulation (such as copyright, privacy, electronic commerce, dispute resolution) than for the infrastructure part (i.e. the electronic communications networks and services). In particular, this paper calls the Commission to use with extreme caution its new power on regulatory remedies, especially in the context of the deployment of NGA, given the uncertainty on the best form of regulation.

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    File URL: http://cadmus.eui.eu/bitstream/handle/1814/17914/RSCAS_2011_33.pdf?sequence=1
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    Bibliographic Info

    Paper provided by European University Institute in its series RSCAS Working Papers with number 2011/33.

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    Date of creation: 20 Jun 2011
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    Handle: RePEc:rsc:rsceui:2011/33

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    Keywords: digital internal market; level of intervention; regulatory remedies;

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    1. Larouche, Pierre & Larouche, Maartje, 2006. "The Triangular Relationship between the Commission, NRAs and National Courts Revisited," MPRA Paper 3574, University Library of Munich, Germany.
    2. Alberto Alesina & Ignazio Angeloni & Ludger Schuknecht, 2002. "What Does the European Union Do?," EUI-RSCAS Working Papers 61, European University Institute (EUI), Robert Schuman Centre of Advanced Studies (RSCAS).
    3. Wallace E. Oates, 1999. "An Essay on Fiscal Federalism," Journal of Economic Literature, American Economic Association, vol. 37(3), pages 1120-1149, September.
    4. Guido Tabellini, 2003. "Principles of Policymaking in the European Union: an Economic Perspective," Levine's Working Paper Archive 506439000000000157, David K. Levine.
    5. Alesina, Alberto F & Angeloni, Ignazio & Etro, Federico, 2001. "The Political Economy of International Unions," CEPR Discussion Papers 3117, C.E.P.R. Discussion Papers.
    6. Cave, Martin & Crowther, Peter, 1996. "Determining the level of regulation in EU telecommunications. A preliminary assessment," Telecommunications Policy, Elsevier, vol. 20(10), pages 725-738, December.
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