MEPs in the Industry Committee (ITRE) rejected the proposal by an overwhelming majority (30 votes, two against and two abstentions) during a vote held late at night on Monday (7 July).
The vote came as a confirmation of doubts expressed earlier by Spanish centre-right MEP Pilar del Castillo Vera, the Parliament's rapporteur on the dossier (EurActiv 25/04/08). It also echoes stances taken by EU telecoms ministers, who have already rejected the proposed measure (EurActiv 12/06/08).
The measures will however still need confirmation in a plenary vote to be held in Parliament in September (first reading).
Under the revised text, Brussels will not have full powers to block decisions by national regulators, which instead will have to be confirmed jointly by the 27 regulatory authorities meeting in a new group, the Body of European Regulators in Telecoms (BERT).
Viviane Reding, the EU telecoms commissioner who drafted the initial proposal, voiced her scepticism about the plan, saying the new European regulatory body will likely create "lengthy procedures".
"Questions remain especially as regards the financing of the new body as well as its capability to arrive swiftly and efficiently at common positions," Reding said. "Here, a lot of further work is indispensable."
Go-ahead for functional separation
MEPs however endorsed a related proposal that would require telecoms operators to create a separate unit to run their network businesses, a process known as "functional separation" which the Commission hopes will boost competition in national markets.
The move was welcomed by Reding, who said the committee's endorsement of functional separation was "good news as it will enable national regulators to address cases of persistent competition bottlenecks".
Functional separation will however only be decided as "an exceptional measure" after confirmation by both the European Commission and the European regulatory body, MEPs said.
Next generation networks
In another move, MEPs voted through measures aimed at encouraging investment in fast internet services using fibre networks. These include "investment sharing" among operators as well as a system of "risk-sharing" between firms making the investment and those wanting access to the new facilities.
More flexibility in allocating radio frequencies
In yet another aspect of Monday's vote, MEPs approved measures to optimise the use of radio frequencies in order to make room for new services such as mobile TV and broadband internet.
The report on radio frequencies, drafted by French Socialist MEP Catherine Trautmann, says EU countries must co-operate with each other and the Commission in the strategic planning, co-ordination and harmonisation of radio spectrum use.
To that end, MEPs called on the European Commission to draft a "radio spectrum action programme" also to allocate the frequencies now freed up by the switchover from analogue to digital TV.
Consumer rights and transparency
In a separate move, the Parliament's Internal Market Committee voted to enhance transparency on prices by providing information that the can be re-used by competitors for consumer information.
Operators will also now be forced to inform customers about the costs of terminating a contract before its normal termination date when it involves handing out free handsets.
