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TELECOMMUNICATIONS COUNCIL
Brussels, 30 November 1999
 
The 2228th session of the Council of the European Union (TELECOMMUNICATIONS) will take place on Tuesday 30 November 1999 (10h00 CET), in the Justus Lipsius Building, Brussels, under the Presidency of Mr Olli-Pekka HEINONEN, Minister for Transport and Communications of Finland.
 
Electronic signatures

The Council should adopt the directive on a common framework for electronic signatures.

Electronic commerce has the potential to become a key stimulus for the world economy in the next century, but secure transactions are essential if this potential is to be realised in Europe. The Directive concerning electronic signatures is intended to remove one of the main remaining obstacles to cross-border electronic commerce. Electronic signatures will also be used in the public sector within national and Community administrations and in communication between such administrations and with citizens and economic operators, for example in public procurement, taxation, social security, or the health and justice systems.

Different methods exist to sign documents electronically, ranging from very simple ones (e.g. the insertion of a scanned image of a hand-written signature into a word processed document) to the very sophisticated (using cryptography).

Digital signatures based on so-called "public-key cryptography" are currently the most recognised form of an electronic signature. In this system the recipient can find out whether or not the signed data has been altered and check the origin of the data by authenticating its source. However, the recipient may also wish to verify whether the sender is really the one he/she claims to be. He may therefore require more reliable information on the identity of the signatory. One way is to have it confirmed (by a certificate) by a third party, e.g. a person or institution mutually trusted by both sender and recipient. In the context of digital signatures these third parties are called "certification service providers".

The Directive aims at facilitating the use of electronic signatures as well as contributing to their legal recognition. It would establish a legal framework for electronic signatures and certain certification services in order to ensure the proper functioning of the Internal Market in this rapidly expanding area.

Further objectives are to promote the interoperability of electronic signature products and to build trust in electronic signatures. In order to achieve this, the draft provides that certain essential requirements specific to electronic signature products must be met.

Although digital signatures based on public-key cryptography are currently the most recognised form of an electronic signature, the Directive follows a "neutral" approach as far as the various technologies and services capable of authenticating data electronically are concerned. This approach takes into account the rapid technological development and the global character of the Internet.

Specific technical requirements are therefore limited and - as far as the signature creation devices are concerned - phrased in a manner which allows them to be achieved by various means. The requirements are spelled out in three annexes, dealing with:
  • the requirements for qualified certificates (annex I)
  • the requirements for certification service providers issuing qualified certificates (annex II)
  • requirements for secure electronic signature creation devices (annex III)
A fourth annex lists a certain number of recommendations for signature verification.

In order not to slow down innovation and the development in the Community of certification services, the Directive stipulates that their providers should in general be free to offer such services without prior authorisation. Notwithstanding this general principle, service providers would be free to adhere to voluntary accreditation schemes aiming at a further development of their services towards the levels of trust, security and quality demanded by the market. But such accreditation schemes may not reduce competition for certification services.

One of the key provisions is the principle of non-discrimination between electronic and hand-written signatures. Thus, a signature should not be denied legal validity solely on the grounds that it is in electronic form. According to the Directive, an electronic signature should be considered equivalent to a hand-written signature (including, e.g. its use as evidence in legal proceedings) if it meets a certain number of conditions:
  • it must be an "advanced electronic signatures", meaning that it
    • it is uniquely linked to the signatory
    • it is capable of identifying the signatory
    • it is created using means that the signatory can maintain under his sole control
    • it is linked to the data to which it relates in such a manner that any subsequent change of the data is detectable.
  • it must be based on a qualified certificate
  • and it must be created by a secure signature creation device

The Directive also includes harmonised liability rules for certification service providers so as to ensure legal security and predictability for both providers and consumers.

As a further measure to ensure user confidence, which is a prerequisite to stimulating electronic communication and electronic commerce, service providers would be requested to respect data protection legislation and individual privacy.

Finally, the Directive lays down the conditions under which certificates issued by certification service providers from outside the Community would be recognised.

The Directive is not intended to harmonise national rules concerning contract law. For this reason the provisions concerning the legal effect of electronic signatures would be without prejudice to form requirements prescribed by national law with regard to the conclusion of contracts or the rules determining where a contract is concluded.

Furthermore, the Directive would not apply to electronic signatures exclusively used within closed systems, nor would it restrict the freedom of parties to agree among themselves - to the extent allowed by national law - the terms and conditions under which they accept electronically signed data.

The time given to Member States for transposing the Directive into national law will be 18 months from its entry into force.
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Telecommunications regulatory package

The Commission will present its Fifth Report on the Implementation of the Telecommunications Regulatory Package, not yet officially transmitted to the Council, as well as its Communication entitled " The 1999 Communications Review: Towards a new framework for Electronic Communications infrastructure and associated services". The Council should then proceed to an exchange of views ending up with an adoption of conclusions on this issue.

The Fifth Report on the Implementation examines the state of implementation of the current telecommunications regulatory framework. It analyses the way in which the transposed national rules apply to the principles of harmonisation directives in practice, and backs up this assessment with an overview of the current status of the telecommunications services markets in the Member States. It concludes by identifying the major outstanding barriers to the achievement of a single European market, and setting out a number of elements which will need to be taken into account in the legislative process leading to the revised regulatory framework.

The Commission’s vision on the revision is presented in the Communication" The 1999 Communications Review ". This Communication contains a review of EU Regulation in this field and presents the ideas for the main elements for a new framework covering all communications infrastructure and associated services. In particular, it sets out:
  • a set of regulatory principles
  • a number of ideas regarding the simplified design of the new regulatory framework (reducing the number of legal measures from 20 to just 6)
  • some provisional positions on specific issues (such as licensing, universal service, competition in the local loop)

In the draft conclusions, the Council reaffirms its previous views regarding the need for a comprehensive approach to regulation, and considers that, given the increasing level of competition in communications markets, the regulatory review should:
  • consolidate and simplify the current regulatory framework
  • ensure that the regulatory framework be oriented increasingly towards the principles of competition law
  • ensure that the regulatory framework continues to meet a range of public interest objectives

The regulation of the communications infrastructure and associated services should be based on the following principles:
  • regulation should be based on clearly defined policy objectives
  • regulation should be reduced to the minimum necessary with proposals for new measures being made only where essential and well justified
  • regulation, and its implementation, should strike the right balance between flexibility and legal certainty. Self-regulation should be examined, and where appropriate, introduced, as a complement to regulation
  • regulation should evolve towards technological neutrality, with the regulation of communications services being, as far as possible, independent of the technology over which such services are delivered
  • regulation, whether agreed at global, regional or national level, should be enforced as closely as is practicable to the activities being regulated

The Commission is invited
  • to take these principles fully into account in its ongoing work on the review of the regulatory framework
  • to present the results of the public consultation on the review in good time so as to allow discussion at political level at the next Telecommunications Council
  • to adopt legislative proposals before the end of next summer (2000) on the basis of the results of the public consultation and the policy orientations emerging from the next Telecommunications Council
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The Information Society of the Future: Responding to the Challenges of Global Electronic Commerce- Open Debate

At about 11. o’clock, the Council will have an open debate on the information society of the future. The debate will be transmitted to the interested media and the public by a video link.

As a background for the debate, the Presidency has prepared a note on this issue. This note states that the information society will become a reality for very many people; the way people live and do business depends increasingly on networks, telecommunications and IT-applications. Electronic commerce is already fundamentally changing not only industry and the behaviour of consumers, but also the approach of governments towards their citizens.

The new communications tools and techniques will change the everyday lives of European citizens in many different ways. Distance working, telemedicine, and distance learning are just some examples of these new modes of behaviour. The change will have a fundamental impact on the way services are provided, creating enormous opportunities for the communications business, but at the same time a huge responsibility for governments, industry and users themselves.

Perhaps the most striking characteristic of the new communications infra-structure is its inherently global nature. The electronic market place is without borders and services can be offered globally. That makes any national or regional approach insufficient.
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Global Business Dialogue (GBD)

It is very important for new services and e-commerce that there is trust among users, governments and industry. To build this trust clear and predictable rules should be created. These rules can be in the form of legislation as well as in other forms. There are various alternative tools to increase trust among actors in the e-commerce field: guidelines, codes of conduct, co-regulation, agreements, recommendations, standards, memoranda of understanding, redress procedures. All these methods, together with legislation, can be used to achieve harmonised solutions to common problems.

In the field of e-commerce the search for a balanced approach has already begun. Aware of the global nature of the problems, the Commission launched in February 1998 an initiative (known as the Bangemann Charter) to move towards a consistent set of principles at global level in certain areas such as taxation, copyright, data protection and liability. In January 1999 in New York, industry responded and the Global Business Dialogue was officially launched. It identified nine main problem areas for e-commerce, which need to be resolved. Consequently, GBD presented recommendations to governments and international organisations as regards future policy framework in the following fields:
  • Authentification and Security
  • Consumer Confidence
  • Content/Commercial communications
  • Information Infrastructure (including interoperability and internet governance)
  • IPR
  • Jurisdiction
  • Liability
  • Protection of Personal Data
  • Tax and Tariffs

The nature of these recommendations vary from one field to an other. As regards those issues most closely linked to telecommunications, the GBD generally recommends minimal regulation, free competition, elimination of subsidies and market entry obstacles, enforcement and implementation of international treaties and alternative on-line codes of conduct, such as out-of-court dispute mechanisms or promotion of trust marks and seal programmes. The role of the industry can be seen as strengthening trust by increasing transparency of business transactions and by developing industry-based standards for new trust mechanisms , such as filtering and rating software to combat illegal and harmful content.

Many of the recommendations from the GBD favour self-regulation in many of the areas under discussion. The concept of self-regulation is useful in trying to find alternative and supplementary methods for regulation. Nevertheless there are already many existing national and community-wide legislative proposals regarding e-commerce which have to be taken into account when evaluating the GBD recommendations and regulation in general.

A basic problem is that it is difficult to label certain types of legislation as e-commerce legislation. Almost all future legislative initiatives, whether community-wide or national will have to take into account this technical development. There are already some proposals for directives under preparation which are targeted at e-commerce, such as the proposals on e-commerce, on electronic signatures, on electronic money and on IPR. The Commission is also about to launch a review process of the whole telecommunications regulatory package.

A balance is needed between the different national and regional regulatory initiatives and global agreements. Equally important is to find a right balance between self-regulation and regulation. The GBD is an important dialogue which can play a role in bringing about both business and government co-ordination on e-commerce issues, and also help to generate a global discussion. One of the main questions is therefore, how to develop effective interaction between the GBD and governmental organisations and how governments can most suitably respond to the GBD`s recommendations in the near future.

In the light of the GBD process, the Presidency invites the Member State governments to consider the following questions:

  • What is the right balance between self-regulation and regulation in the light of the rapid and global development of electronic commerce? What are the implications for the future European regulatory framework for communications services?
  • What are the respective roles of the different international forums and national governments in building the appropriate environment for e-commerce?
  • What is the proper way to proceed? How can the governments of the EU most suitably respond to the GBD recommendations?
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Radio spectrum policy
Commissioner LIIKANEN will present to the Council a Commission Communication " Next Steps in Radio Spectrum policy; Results of the Public Consultation on the Green Paper (on Radio Spectrum Policy , adopted by the Commission on 2 December 1998)". The Green Paper of 1998 addressed the role of radio frequencies in the development of radio-based markets and non-commercial applications, and focused on the regulatory framework for the planning and access of radio spectrum resources.

At the Telecommunications Council meeting last April, the Commission informed orally the Council of the responses the Commission received during the public consultation period and on the next steps to be taken on this dossier. The Communication now formally proposes the following three initiatives:
  • the establishment of a Spectrum Policy Expert Group to address radio spectrum policy issues at Community level
  • the creation of a regulatory framework for radio spectrum policy, which would eventually replace sector-specific decisions such as those on satellite personal communications services (S-PCS) and universal mobile telecommunications system (UMTS)
  • the submission of a communication on the Community’s policy objectives linked to the agenda of the World Radiocommunications Conference (WRC)
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Standards for the transmission of television signals
Commissioner Liikanen will present a Communication on the Implementation of Directive 95/47/EC on the use of standards for the transmission of the television signals.

The main objective of this Directive was to establish a regulatory regime adapted to the start-up phase of new digital TV services on the one hand, while providing adequate continuity with the earlier regulatory environment for advanced TV services based on analogue technology on the other. Regarding digital television, the intention was to provide a measured balance between the objective of encouraging investment, and "first mover" advantage during the start-up phase, while protecting consumers’ interest in a proportionate way and promoting competition.

The Communication analyses Member States’ transpositions of the Directive and takes a broad view on market and technical developments in digital television. It also examines the evolution of digital television services in Member States’ markets and, in particular, the available technologies on the market.

As a conclusion of this examination, the Commission considers that the regulatory framework laid down by the Directive has had important benefits; however, in the future, a broader approach to infrastructure, transmission and access should be adopted.
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The year 2000 computer problem (The "millennium bug")
Commissioner LIIKANEN will present to the Council a third quarterly report regarding the millennium bug problem.

It is recalled that in response to concerns expressed by the Council on various occasions, the Commission presented a 1st quarterly report of the Commission services entitled "EU infrastructures and the Year 2000 Computer problem " to the Telecommunications Council on 22 April last. At that meeting the Council approved a resolution focusing in particular on the critical infrastructure sectors. The European Council on 3-4 June in Cologne called on the Commission to step up its efforts and convene a high-level working party, able to put forward proposals for strategic decisions which may be required within the EU to ensure proper functioning of essential areas of infrastructure, should computer problems arise in connection with the millennium date change. The Commission now reports on the basis of the work carried out by the High Level Group.
 
A press conference will be held by the President of the Council on the outcome of the session.
 
This note has been drawn up under the sole responsibility of the Council of the EU's Press Service.
Website Council of the European Union

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