To ensure that revisions to the Telecoms Competition Code1('Code') contribute to the healthy development of Singapore's telecoms market, the Infocomm Development Authority of Singapore (IDA) is conducting a second ...
Singapore, 11 May 2004 | For Immediate Release
To ensure that revisions to the Telecoms Competition Code1('Code') contribute to the healthy development of Singapore's telecoms market, the Infocomm Development Authority of Singapore (IDA) is conducting a second public consultation on proposed revisions. IDA's first2 public consultation, conducted in the fourth quarter of 2003, received 12 submissions3 on a range of issues reflecting different business interests.
After a detailed review of consultation submissions, IDA will maintain proposed Code revisions, along with the inclusion of some new refinements. Proposed revisions that are maintained include the definition of 'dominance'; to relax advertising rules to allow all telecoms licensees with increased marketing flexibility; and, to require dominant licensees to disclose standard telecoms prices, discount structures and service termination terms to the public.
New Code refinements continue to be aligned with the policy of proportionate regulation. IDA will monitor and maintain regulatory oversight in market segments with limited competition, and will scale back its regulatory role in competitive market segments. In market segments with limited competition, IDA is proposing to identify circumstances where it is necessary for dominant licensees to offer wholesale prices at cost-based or retail-minus levels. For wholesale telecoms services offered voluntarily by dominant licensees, prices should be just, reasonable and non-discriminatory, and price squeeze practices will be prohibited.
In segments where market forces promote and maintain effective competition, dominant licensees will be exempted from special obligations. Pricing of effectively competitive services will be left to market forces. Unnecessary provisions on dominant licensees will be removed to provide incentive to innovate. These provisions include the obligation to provide line-sharing, and co-location in underground cable chambers.
In addition, there are new Code revisions that will improve regulatory processes to provide more transparency and clarity. These include issuing of preliminary decisions on modifications to the Code, review of exemption requests by dominant licensees, and re-classification of dominant licensees for public comments before IDA finalises regulatory decisions. IDA will also publish guidelines that provide clarification to issues that are considered in policy and regulatory assessments.
Industry feedback has also requested for IDA to move to a 'market-by-market' regulatory approach from the current 'entity-based'approach. A 'market-by-market' approach starts with the presumption that all telecoms market segments are effectively competitive, unless the regulator determines that a firm has significant market power in a specific market segment. Currently, IDA presumes that a licensee, with historical monopoly before full liberalisation, continues to have significant market power in the market segments it participates in. As such, this licensee is subject to more stringent regulatory requirements applicable to dominant licensees. However, IDA will exempt the dominant licensee from these regulatory requirements as effective competition takes root.
While there is good progress in competition development, effective competition has not taken root across all market segments. This is similar to early liberalisation experiences of mature markets like the UK and US. Currently, there is effective competition in some segments (mobile phone services and wholesale international telephone services) and in others, competition remains limited (local fixed line and local leased circuits). As such, adopting a 'market-by-market' approach at this point in time will likely yield similar regulatory results to the 'entity-based' approach currently adopted by IDA. Moreover, in the European Union, the market-by-market approach is still in the early stages of implementation, and the process has proven to be more difficult and lengthy than initially expected.
IDA will continue to retain the 'entity-based' approach while it continues to study the merits of a 'market-by-market' approach, and consider how this can be introduced in tandem with future telecoms competition development.
More details of proposed revisions can be found in IDA's Telecom Competition Code Consultation Document, available at https://www.imda.gov.sg/, in the sections 'Policy & Regulation', 'Consultation Papers'. IDA invites views and comments to be submitted in writing, to reach IDA on or before 12 noon, Tuesday, 22 June 2004. IDA expects to complete the review of the Telecom Competition Code by the second half of 2004.
ISSUED BY CORPORATE COMMUNICATION DIVISION
INFOCOMM DEVELOPMENT AUTHORITY OF SINGAPORE
Notes to Editor:
1The Code of Practice for Competition in the Provision of Telecommunications Services (Telecoms Competition Code) has successfully established competition in Singapore?s telecoms sector since full telecoms liberalisation. It defines the boundaries for competition conduct in a liberalised telecoms environment and aims to foster fair, effective and sustainable competition to promote consumer welfare. The Code is internationally regarded as a sound and comprehensive piece of competition legislation. It was developed in close consultation with the industry, local and international telecom experts, and was based on studies of international best practices. The Code is available under the 'Policy & Regulation' section of the IDA website at https://www.imda.gov.sg/.
2 To further enhance competition and to align with market developments, the IDA embarked on the first triennial review and public consultation of the Code in October 2003. The first triennial review of the Code seeks to hone the regulatory framework to ensure its relevance to the changing market environment. (Section 1.6 of the Code requires IDA to carry out a review the Code at least once every three years.)
About Infocomm Development Authority of Singapore
The Infocomm Development Authority of Singapore (IDA) develops, promotes and regulates info-communications in Singapore, with the aim of establishing Singapore as one of the world's premier infocomm capitals. To nurture an internationally competitive infocomm industry, IDA offers a comprehensive range of programmes and schemes for both local and international companies. For more information, visit https://www.imda.gov.sg/
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