Thursday, January 29, 2009

EU Threatens Lawsuit Against Romania Over Regulator

By Matthew Newman

Jan. 29 (Bloomberg) -- European Union authorities threatened to sue Romania over the government’s failure to ensure the independence of the national telecommunications regulator.

The European Commission, the EU’s executive body that enforces the bloc’s laws, said in a statement today that the Romanian government’s decision to remove the president of the telecom regulator is a “serious violation of the regulator’s independence.”

“The situation in Romania is particularly worrying because this is not the first time that this has happened,” Martin Selmayr, a commission spokesman, told journalists at a regular briefing today.

Under EU rules, telecom regulators must be independent of influence by the government and companies to ensure fair competition. The Brussels-based commission, which could file a lawsuit against Romania at the European Court of Justice in Luxembourg, has threatened legal action against other countries over regulatory independence.

The EU threat follows the Romanian prime minister’s decision last August to fire the telecom regulator’s president. The Bucharest Court of Appeals overturned that decision. The government then restructured the regulator and named a new president the same day.

The Romanian government’s press office did not immediately respond to two calls seeking comment.

Portugal

In a related matter, the commission sued Portugal at the EU’s highest court for failing to start a competitive bid to provide so-called universal services, such as connection to a telephone network and public payphones.

The case began in 2005 when the commission told Portugal that operators weren’t able to compete with Portugal Telecom SGPS SA to offer basic services because the former monopoly was given a 30-year concession until 2025.

A spokesman for Portugal’s Public Works, Transportation and Communications Ministry declined to immediately comment.

EU telecoms rules state that governments can’t discriminate when selecting operators to provide basic services.

To contact the reporter on this story: Matthew Newman in Brussels at Mnewman6@bloomberg.net.

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