European Net Neutrality – Regulation and guidelines

by Frode Sorensen

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European net neutrality is at the beginning of a new era. Through the net neutrality Regulation adopted in 2015, and corresponding net neutrality Guidelines issued in 2016, a new foundation for protection of the open Internet in Europe is established. The regulatory monitoring of net neutrality at the national level, as prescribed by the Regulation, should  guarantee a neutral Internet for European citizens and businesses.

Originally published at Norwegian Communications Authority (Nkom).
Full text published in Net Neutrality Reloaded presented at the UN IGF.

The goal of net neutrality is to protect the value of the Internet for end-users, for the industry, and for the overall democratic society. In concrete terms, net neutrality boils down to equal treatment of traffic on the Internet, whereby end-users themselves can decide how to use their own Internet access, and whereby entry barriers for content and application providers (CAPs) are low. As a result of non-discriminatory treatment, the Internet should remain an open platform for communication useable for any purpose, stimulating the flourishing of social, democratic, cultural, and economic development.

Evolution of European net neutrality

Looking back at the timeline of net neutrality in Europe, it has been a journey over several years. Using the 2009 Regulatory Framework(1) as a reference, it consists of a seven years’ history with ups and downs. This framework had its good intentions, but was over time judged by the political institutions as insufficient to protect net neutrality.

It has been argued that access regulation in Europe should be sufficient to ensure net neutrality, since end-users could switch to alternative Internet service providers (ISPs) to achieve neutral Internet access(2). However, an essential characteristic of Internet communication is ignored in this argument; as an Internet user you are depending on the users in the other end which you communicate with. Many of those may not switch to a neutral access due to the pricing policy of their ISPs. Thereby the Internet becomes fragmented, and the network effect is significantly reduced.

During this period, BEREC on request from the European Commission conducted a traffic management investigation(3) among European operators. The results from this investigation showed that on average, every fifth European subscriber to fixed Internet access, and as much as every third subscriber to mobile Internet access experienced restrictions to the use of their own Internet access service, such as blocking of VoIP.

National regulatory regimes

Over the last years, different national approached to net neutrality evolved. Norway has the longest running net neutrality regime in Europe. Based on a co-regulatory approach, not to be confused with a self-regulatory approach, national net neutrality guidelines were established in Norway in 2009(4). These guidelines contained rules against blocking and throttling of applications, essential to achieve net neutrality.

The Netherlands and Slovenia adopted net neutrality laws in 2011(5) and 2012(6), and then several additional European countries started to consider similar regulatory measures. On the other hand, other countries used self-regulatory approaches and/or based their approach on transparency while effectively allowing throttling and blocking of applications over the Internet access(7).

On this background, with a significant level of restrictions on Internet access for European citizens, and an increasing variation in regulation of net neutrality among member states, the European Commission proposed a new net neutrality regulation in 2013. Following the law-making process of the European Union, net neutrality rules were finally adopted by the end of 2015(8).

Regulation and guidelines

The European net neutrality rules were published in the Official Journal of EU in November 2015. This Regulation has a solid legal basis, established through the European democratic law-making process. According to the Regulation, BEREC was given the mandate to develop Guidelines for regulators’ implementation of the Regulation(9). These Guidelines were published 30 August 2016(10).

In this regard, it is important to note that BEREC’s Guidelines do not create any new rules; they only providing guidance on the regulatory implementation of existing rules as adopted by the law-makers. Furthermore, national regulators shall conduct supervision and enforcement of the Regulation, and also publish reports on an annual basis on their monitoring and findings(11).

The European net neutrality Regulation is seeking to safeguard equal and non-discriminatory treatment of Internet traffic and related end-users’ rights, such as the right to access and distribute information(12). This describes in other words “net neutrality” as the goal. Interestingly, in the corresponding recital of the Regulation, preservation of the Internet ecosystem as an engine of innovation is explicitly included among the goals(13).

The operational parts of the Regulation cover commercial conditions, such as speed and volume, but also other commercial practices, where many will consider zero-rating to be the typical example. Furthermore, different technical practices are covered; reasonable traffic management, exceptional traffic management and specialised services.

Commercial practices

Commercial practices, and zero-rating in particular, have been surrounded by some uncertainty in the European discourse on net neutrality, and the opinions have been strong on both sides(14). Law-makers have chosen a middle course regarding zero-rating and other commercial practices in the Regulation, and such practices are neither explicitly allowed nor explicitly prohibited.

Based on the Regulation’s ban on technical blocking and throttling of applications (15), BEREC’s Guidelines recommend to prohibit zero-rating practices where the zero-rated applications receive preferential treatment after the data cap is reached, e.g. where the zero-rated application is still accessible, while other applications are blocked(16).

For more complex cases, BEREC recommends general assessment criteria which national regulators can use to assess commercial practices in general, including zero-rating. These criteria encompass market positions of the providers involved, covering ISPs and CAPs, the scale of the practice, effects on end-user, including effects on CAPs, and whether the general aims of the Regulation are circumvented(17).

Technical practices

When assessing technical practices for Internet communications, the European net neutrality rules define three different levels of traffic management. The ground level is when Internet traffic is treated agnostic to applications and endpoints generating the traffic, often referred to as “best effort”. The two next levels contain reasonable traffic management and exceptional traffic management. BEREC’s guidelines describe more in detail how regulators should assess such practices.

Furthermore, when Internet traffic is transmitted together with specialised services over a shared infrastructure, which often is the case, regulatory assessment of the net neutrality rules also takes into account overall traffic management practices. Such traffic management is related to how traffic from specialised services is handled in parallel with traffic from Internet communications.

The main question when specialised services come into the picture will typically be whether network capacity is sufficient to avoid a detrimental effect on the quality of internet access services. Regulations may, as in the European case, set out requirements in this regard. The next question will then be how sufficient capacity is ensured, and in particular how ISPs ensure that specialised services don’t degrade Internet communications.

Continued development of net neutrality regulation

The European net neutrality rules provide a solid basis for regulation of net neutrality the next years. However, due to the novelty of the rules, there will most probably be challenging questions to resolve. With a view to preserve the value of the Internet for upcoming generations, it is important to continue the work to maintain the net as an open and non-discriminatory platform for everyone.

The current high-profile net neutrality question about zero-rating has not achieved a clear answer under the European net neutrality Regulation. However, a general assessment methodology is provided, with a possibility for national regulators to intervene if necessary. Over time the development of the market under this regulatory regime will gather experiences that can be used to feed into any future legislative processes.

Compatibility with emerging technologies

The European net neutrality Regulation provides a framework which is compatible with the Internet technology evolution. On the one hand the traffic management measures cover traditional best effort communications, advanced congestion handling functionality, and potential class-based QoS architectures. BEREC’s guidelines elaborate regarding assessment of these mechanisms, based on the general provisions of the Regulation.

On the other hand, the Regulation allows provision of specialised services in parallel with Internet communications, which facilitates experimenting with different business models. This may show particularly interesting for mobile access networks, where the upcoming 5G network architecture emphasises QoS-based services, and at the same time continue today’s use of mobile access networks to provide Internet access services.

Growing experiences

The conditions for net neutrality in Europe and related regulatory measures should over time be reconsidered based on how commercial and technical practices develop. In case zero-rating practices should distort the market and reduce end-users’ control over their own Internet use and raise entry barriers for CAPs, this may spur clearer rules of such practices.

Tension between Internet-based communication and specialised services may evolve over time. The European net neutrality Regulation prescribes obligations on national regulators to “closely monitor and ensure compliance” with the Regulation, whereby this evolution will be scrutinised, and corrective regulatory measures may be launched if necessary.

References:
(1) Regulatory framework for electronic communications, 2009
(2) Rebooting the Net Neutrality Debate, van Schewick, 2014
(3) Traffic Management Investigation, BEREC, 2012
(4) Norwegian guidelines for net neutrality, Nkom, 2009
(5) Dutch Telecommunications Act, 2011, Article 7.4a
(6) Slovenian Electronic Communications Act, 2012
(7) Implementation of the regulatory framework, EC, 2014
(8) Regulation 2015/2120, EP and Council of EU, 2015
(9) Regulation 2015/2120, Article 5(3)
(10) Net Neutrality Guidelines, BEREC, 2016
(11) Regulation 2015/2120, Article 5(1)
(12) Regulation 2015/2120, Article 1
(13) Regulation 2015/2120, Recital 1
(14) Net neutrality consultation report, BEREC, 2016
(15) Regulation 2015/2120, 3rd subparagraph of Article 3(3)
(16) Net Neutrality Guidelines, paragraph 41
(17) Net Neutrality Guidelines, paragraph 46

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