EU Elections, New EC Could Affect Digital Policy

A new European Parliament and European Commission could spark changes in digital and telecom policies. The make-up of the new EC, and who will lead its digital and competition agendas, will play a larger role than parliament members, stakeholders said. Key concerns include keeping the telecom sector competitive and making correct choices about digital policy.

Elections took place June 6-9 across the 27 EU countries to fill the 720 seats of the European Parliament for a five-year term. Provisional results are here.

The European Parliament's composition won't have great significance for telecommunications policy. Instead, lawmakers will focus on protecting children from Big Tech and AI, Strand Consult's John Strand said in an email. Power to make telecom-sector changes resides in the EC. For example, Margrethe Vestager of Denmark, the competition commissioner, won't remain in her role.

Whether Internal Market Commissioner Thierry Breton retains his slot is an open question, Strand said. Breton, a former CEO of France's Orange, has a good understanding of telecom industry needs and crafted significant policy on cybersecurity, the Digital Services Act and in other areas, according to Strand. However, he hasn't "solved the structural challenges" of the sector because network and mobile operators have failed on key telecom policies such as spectrum and consolidation, Strand argued.

Moreover, the newly elected parliament and EC won't change security policies concerning China, Strand said: "If anything, we expect a tightening and extension to other parts of the telecommunications infrastructure and 5G."

Despite Europe's well-known lag behind other world powers, "there is another story to be told about Europe's digital agenda," a commentary by Centre for European Policy Studies Research Director Andrea Renda said. The EU is gradually laying the foundation for a ground-breaking digital edifice that could boost its future role as a geopolitical actor and an economic power: "European policymakers need to ensure that this is a key priority" in the next five-year EU cycle.

Election results "will make a big difference on the direction Europe will take on digital," Renda wrote. In the near-term, the "Brussels effect" will probably wane as the world realizes that the general data protection regulation (GDPR) hasn't been particularly effective.

Increasingly, GDPR rules are giving way to technological standards when problems arise, Renda wrote. The same is likely with other laws such as the Digital Services Act, Digital Markets Act and AI Act. To make these rules work, the EU must move from traditional legislative drafting and enforcement to RegTech, regulation via tech standards and protocols. As such, Renda urged that the EU focus on digital identity and the digital wallet to enable digitalized solutions that empower people and businesses. Creating a data-driven single market would be a "third way" to digital transformation that would be more compatible with EU values and principles than copying U.S. or Chinese models, he said.

The EC is consulting on a discussion paper about managing Europe's digital infrastructure needs, noted Luc Hindryckx, director general-European Competitive Telecommunications Association, in an interview. Breton unveiled the paper before the elections to allow stakeholders to weigh in on the state of play in the sector. The key question now is who will take charge of the EC digital agenda. Whoever does so could decide to ignore the paper, he noted.

ECTA is most concerned about "ex ante" regulation, or antitrust rules put in place before issues arise, Hindryckx said. The discussion paper signals that the EC wants to propose cutting the number of relevant markets subject to prior competition review from the current two to zero, he said. ECTA, however, believes that "a diversity of telecom operators is essential to guarantee Europe's competitiveness."

Competition is also important to the European Telecommunications Network Operators Association, whose members are incumbent telcos. "It is crucial that we see a deep reform of connectivity policies" during the new EC term, ETNO Deputy Director General Alessandro Gropelli emailed. While it's too early to guess the specific policy orientations of the new political leadership, "we expect them to focus on competitiveness, security, and Open Strategic Autonomy," which is the EU's capacity to act independently of other countries on policy.