Eurogroup President, Kyriakos Pierrakakis, is standing by his proposal for a new own resource based on the telecoms sector. For several weeks now, the Greek Minister for Economy and Finance has been raising the idea of major harmonisation of national markets in this sector to help finance the EU’s next long-term budget (see EUROPE 13902/20). In practical terms, Mr Pierrakakis is proposing to synchronise, at EU level, auction systems for the allocation of spectrum and to assign part of the proceeds to the post-2027 Multiannual Financial Framework (MFF). Greece is therefore expected to raise this option shortly at the level of Member States’ ambassadors to the EU (Coreper).
Member States do in fact most often allocate radio spectrum (4G, 5G, soon 6G, etc.) to the various telecommunications operators (Orange, Vodafone, Deutsche Telekom, Telefónica, etc.) by means of auctions. At this stage, the lucrative proceeds generated go to national budgets.
The Eurogroup President envisions that, in future, 75% of these sums could feed into the MFF, while the remaining 25% could, in his view, finance a fund managed by the European Investment Bank (EIB), notably to invest in the modernisation of network infrastructure.
The idea seems interesting at a time when the EU is seeking new sources of revenue to simplify the equation of the 2028-2034 European budget (see EUROPE 13909/1), especially given the amounts at stake.
“The annualised cost of spectrum licences to operators has stood at over €8 billion each year for the past five years, and over €30 billion has been spent on 5G spectrum licences for a total of almost €50 billion spent in spectrum auctions since 2020”, detailed a report by trade association Connect Europe.
Kyriakos Pierrakakis’ ideas are also in line with the Draghi and Letta reports, which all lamented the fragmentation of these markets, limiting the ability of national players to invest, innovate and compete with major global rivals.
However, seeing this proposal come to fruition in the short term seems unrealistic, as Member States appear attached to this revenue and reluctant for the EU to encroach on their powers in this area, as confirmed by Zach Meyers, Director of Research at the Centre on Regulation in Europe (CERRE).
“It seems unlikely that national governments would voluntarily agree to transfer this revenue to ‘Brussels’. Member States also want to retain their right to impose obligations on mobile operators present in their territory, for example to guarantee network deployment in rural areas”, says this researcher specialising in the telecoms market. “It is therefore more likely that a gradual convergence of European spectrum management policies will emerge, without going so far as to establish genuinely unified auctions”, Zach Meyers concludes.
In any case, this avenue has not at this stage been formally incorporated into the discussion on own resources by the Irish Presidency of the EU Council (see EUROPE 13905/29).
See Connect Europe’s report: https://aeur.eu/f/mzl (Original version in French by Clément Solal)