Dear readers,

The cat is out of the bag: Last week, in response to the US government's Inflation Reduction Act, the European Commission published its eagerly awaited Green Deal Industrial Plan. Eagerly awaited because there is a lot at stake. The global economy stands on the brink of a green transformation and is at the same time in the grip of a geopolitical realignment set to redistribute the riches of tomorrow.

No wonder, therefore, that industrial policy is back on the agenda. Industrial policy is geopolitics by other means which is particularly awkward for the EU because State aid law, for good reason very restrictive, is actually supposed to protect the common internal market from distortions of competition by the State. Now the Commission is proposing a scheme which relaxes State aid law and promises generous financial aid. Worst case, the Green Deal Industrial Plan will cause new structural divergences within the EU and lead to a costly subsidy race with the US. On the other hand, we cannot simply stand by and watch while the US diverts investments and recruits companies because the EU's competitiveness has been eroding for some time. Direct investments go to where energy is cheap and secure – and, for the foreseeable future, that is unlikely to be the EU.
 

Broadband rollout: Commission wants to facilitate access to physical infrastructure

On 10 February, the Commission will submit a Gigabit Infrastructure Act. The legislation, probably a Regulation, will replace the existing Directive on measures to reduce the cost of deploying high-speed electronic communications networks [2014/61/EU, see cepPolicyBrief 43/2013]. According to the Commission, the network rollout is being held up most notably by major inefficiencies in infrastructure development relating to the use of passive infrastructure, such as conduits, distribution boxes and antenna systems. Furthermore, the coordination of construction work is unsatisfactory, approval procedures are too burdensome, and there are problems with the expansion of in-building infrastructure. In order to reduce network rollout costs, the Commission therefore wants, among other things, to extend the access rights of network operators to include further passive infrastructure. In addition, access to information on existing physical infrastructure is to be improved, unless health or safety concerns prevent this or the infrastructure is critical. The flow of information about forthcoming construction work will also be improved by establishing a central information point. Regulations on fixtures and fittings and access to in-building physical infrastructure will be tightened.

OTT fair share: Consultation on participation of tech companies in grid expansion costs

The Commission is expected to launch a consultation on the possible financial participation of tech companies in grid expansion costs in mid-February – after several postponements. The debate has been going on for several months. Ultimately, the question is whether the network giants that are responsible for a large part of the data traffic on the internet, such as Netflix and Google, should contribute more to the costs of expanding the telecommunications infrastructure. This could be done, for example, through a levy that the tech companies pay to the telecommunications companies or through the establishment of a fund to which they would have to pay contributions. Within the framework of the consultation, the Commission also wants to ask questions about the European radio frequency policy, the EU requirements on universal services and current market developments.