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UK communications sector must be at heart of Brexit negotiations - Ofcom boss

Published 01/12/2016

Ofcom chief executive Sharon White said the UK communication industry is 'inextricably' European (Ofcom/PA)
Ofcom chief executive Sharon White said the UK communication industry is 'inextricably' European (Ofcom/PA)

The UK's communications sector is "inextricably" European and it is vital for consumers that it features at the heart of Brexit negotiations, the head of Ofcom has warned.

Chief executive Sharon White said a "triple test" should be used to decide which EU laws should continue to apply in the UK in the future: whether they prioritise the interests of UK consumers, promote competition and investment and support UK companies to trade successfully in the EU and globally.

And she said the UK should be open to retaining what works in the EU, improving it where it does not, and "avoiding making things worse, by inadvertently weakening powers or protections".

In a speech to the Institute for Government in London today, Ms White said the industries Ofcom regulates are "inextricably European businesses" in terms of ownership and revenue, while the UK was home to the largest number of pan-European media companies and some of the most respected creative and technical talents in the world.

She said: "Many work here under EU permits; some estimates suggest up to 40% of people working in the creative industries may be EU nationals born outside the UK.

"Broadcasters rely on talented people from overseas; and equally on exporting the programmes they help create to the rest of the world."

But she added: "Yet the importance of our sector extends far beyond its enormous scale and economic worth.

"Making Brexit a success matters for communications - because these services are fundamental to our lives."

She said the "country of origin" principle, that allows broadcasters to transmit across the entire EU as long as they comply with the rules of the country where they originate, should continue in the UK after Brexit so that media companies based here do not face new hurdles "or worse, feel compelled to set up in another European country".

She said: "The country of origin rule is a good example of an EU law that benefits member states and supports broadcasters - providing a mass audience, and promoting cultural exchange by transcending borders.

"But keeping this principle after Brexit will demand constructive discussions with European neighbours. Country of origin cannot endure merely by virtue of existing in UK law.

"It will stand if the EU 27 continue to allow UK-based companies to broadcast to their markets under UK rules, and if the UK allows companies based overseas to broadcast here under EU rules - over which we'd no longer have direct influence."

She said Brexit would also mean that UK and European competition authorities could both have jurisdiction over some mergers, adding that "clearly that would need close co-ordination".

But she also said that Brexit offered the chance to introduce new protections for consumers if consolidation in the sector led to a small number of big players.

"If these markets become uncompetitive, Ofcom should be able to step in to protect UK consumers," Ms White said.

"We and other regulators made this argument to the European Commission, without success. The EU laws in this area remain unclear. We now have the opportunity to put this right in UK law.

"This is not regulatory creep. Nor is it about new powers for the sake of it. Rather it is about ensuring that, in a rapidly evolving sector, UK laws protect UK consumers from new, anti-competitive threats."

And she said progress such as the recent rules reducing roaming charges for mobile phone users across the EU must be reflected in agreements between the UK and member states "otherwise our mobile operators may be exposed to unfair costs, and our people and businesses could end up paying more than our European neighbours".

Ms White said: "Preserve, improve, and handle with care - our vision for how EU communications law should be reflected in UK law."

And she added: "We must retain our influence at the heart of European and international discussions around the communications sector."

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