Commission Report 2002 (Slovakia)

• Progress since the last Regular Report
• Overall assessment
• Conclusion

Chapter 19: Telecommunications and information technologies

Progress since the last Regular Report

Since the last regular report, some further progress can be reported in the telecommunication sector.

As regards the liberalisation of the telecommunications market, no further progress can be reported.

Fixed network penetration peaked at around 32 %, slightly falling back in response to recent price changes designed to bring prices more closely into line with costs as required by the acquis. Fixed network modernisation and price rebalancing still have some way to go. The mobile sector continued to maintain its quick growth to reach a market penetration of 40 % of inhabitants (as compared to 29 % in the last reporting period). A combined license for GSM and UMTS to a new, third mobile operator and two separate licenses for UMTS to the two, already GSM operating companies have been issued in June and July 2002, respectively, allowing UMTS operations to commence when market conditions permit.

The Government has adopted a strategy on the Information Society in Slovakia, aiming at implementing the e-Europe + initiative and establishing a National Agency as a co-ordinator in the area of information technology.

As regards the regulatory framework, the Slovak Parliament failed to adopt a draft amendment to the Act on Telecommunication in August 2002, prepared by the Government and aiming at advancing alignment with the acquis. A Department for Economic Regulation has been established within the Telecommunication Office in May 2002. The Office has issued roughly 5,600 decisions, comprising licences, type approvals, penalties and assignment of numbers. Only 7 decisions were appealed against in the Supreme Court, 6 of which were confirmed.

As regards postal services, considerable progress was achieved by Slovakia in adopting the Act on Postal Services in November 2001, which has partially aligned Slovak legislation with the relevant acquis. This Act entered into force in January 2002, with the exception of provisions concerning correspondence and direct mail items up to 350 g, which will be enacted in January 2004. Based on this Act, a Postal Office was established at the beginning of this year as an independent regulatory authority in the field of postal services.

Overall assessment

As regards the telecommunications sector, legislative alignment has reached a high level. In order to achieve full compliance with the acquis, issues related in particular to local loop unbundling and universal service need to be addressed, as was the aim of the rejected Government draft. Slovakia has not yet been able to evaluate the economic implications of implementing fully the universal acquis so as to achieve affordability and a decision on this point remains outstanding. Slovakia will need to transpose the updated telecommunications acquis before accession and to complete the implementation procedures as soon as possible afterwards.

Fair competition and proper functioning of the marked need still to be ensured. Further efforts are necessary to prepare for full liberalisation of the market. The independence of the regulatory authority has reached now a good level but needs to be further safeguarded. In particular, in order to achieve a proper separation of regulatory from operational functions, the Ministry of Transport, Post and Telecommunication should no longer exercise the state's property rights in the incumbent operator. co-operation with the competition authority has reached a satisfactory level.

The number of staff in the Ministry of Transport, Post and Telecommunications remains with 10 persons relatively low. The Telecommunication Office currently employs 190 people many of whom are engaged in activities not required by the acquis. In view of the forthcoming full liberalisation of the sector, however, the Office is not yet sufficiently resourced. Budgetary constraints have prevented the office also from reaching its full potential.

As regards postal services, after a slow start it seems that Slovakia has taken the first steps in order to comply with the acquis by the date of accession. Legislation needs to be brought fully in line with the acquis, notably as regards reserved services and the licensing regime. The administrative capacity of the newly created national regulatory authority needs to be strengthened.

Conclusion

In its 1997 Opinion, the Commission concluded that Slovakia would have some difficulty in complying with the acquis in the medium term because there was insufficient administrative capacity to complete new legislation and enforce it. It added that greater competitiveness of the public operator had to be achieved to attract investment and to prepare for competition.

Since the Opinion, Slovakia has made reasonable progress in aligning with the acquis, particularly in terms of putting the necessary legislative framework and regulatory authorities in place. Over the past years, Slovakia's policy in this area has moved steadily towards complete transposition and implementation of the acquis and the completion of liberalisation. This has now been achieved to a considerable extent, despite the recent setback in the telecommunications sector. Administrative capacity still needs to be strengthened.

Negotiations on this chapter have been provisionally closed. Slovakia has not requested any transitional arrangement in this area. Slovakia is generally meeting the commitments it has made in the accession negotiations in this sector.

In order to complete preparations for membership, Slovakia's efforts now need to focus on ensuring an affordable universal service in the telecommunication sector, on finalising alignment in the postal sector and on strengthening, overall, the administrative capacities.

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