National Broadband Plan: Discussion (Resumed)

I welcome the following officials from the Commission for Communications Regulation, ComReg, to the meeting to discuss the national broadband plan: Mr. Garrett Blaney, chairperson and commissioner; Mr. Jeremy Godfrey, commissioner; Mr. Robert Mourik, commissioner; and Ms Barbara Delaney, director of retail and consumer services.

Before we begin, I draw witnesses' attention to the fact that by virtue of section 17(2)(l) of the Defamation Act 2009, witnesses are protected by absolute privilege in respect of their evidence to the committee. However, if they are directed by the Chairman to cease giving evidence on a particular matter and they continue to so do, they are entitled thereafter only to a qualified privilege in respect of their evidence. They are directed that only evidence connected with the subject matter of these proceedings is to be given and they are asked to respect the parliamentary practice to the effect that, where possible, they should not criticise or make charges against any person, persons or entity by name or in such a way as to make him, her or it identifiable.

Any submission or opening statements that witnesses have made to the committee will be published on the committee website after this meeting.

Members are reminded of the long-standing parliamentary practice to the effect that they should not comment on, criticise or make charges against a person outside the Houses or an official either by name or in such a way as to make him or her identifiable.

I remind members and witnesses to turn off their mobile phones or put them on flight mode as they interfere with the sound system.

I invite Mr. Blaney to make his opening statement.

Mr. Garrett Blaney

Gabhaim buíochas leis an gCathaoirleach agus tá muid buíoch as an gcuireadh a bheith i láthair anseo inniu arís. On behalf of the Commission for Communications Regulation, we are happy to appear before the committee again to address further queries on the national broadband plan, NBP, and specifically in respect of universal service. I am joined today by my fellow commissioners, Jeremy Godfrey and Robert Mourik, and by my colleague, Barbara Delaney, who is the director of retail and consumer services in ComReg. As I stated when we appeared before the committee on 5 June, I have been chair of ComReg since January of this year. My fellow commissioner, Robert Mourik, also joined at this time, while Jeremy Godfrey has now been with ComReg for almost six years.

ComReg is the national regulatory authority for electronic communications. We promote competition and investment in the sector. We uphold end-user rights and we manage the radio spectrum. In our recently-published strategy statement, we confirmed our vision for the sector that consumers and businesses in Ireland have affordable, high-quality and widespread access to communications services and applications that support their social and economic needs.

Our role in achieving this vision is to ensure that communications markets operate effectively in the interests of end-users and society. In the past several years, predictable and proportionate regulation has created an environment that has led to investment in high-speed broadband networks covering three quarters of the premises in the State; at the same time, there has been an increasing choice of service providers. In the next few years, operators plan to make available direct fibre connections to most of these premises.

However, there are parts of the State where the population density is lower and high-speed broadband would not be a viable commercial investment. Consumers and businesses in these areas have not benefitted equally. That is why we welcome the Government’s national broadband plan, which will address this market failure.

ComReg has provided the committee with a detailed submission on universal service in advance of this meeting but in the interests of time, if it is allowed, I will give a summary.

Universal service is a safety net currently used to ensure that voice and other basic communications services are made available at an affordable price to a minority of citizens that may not be able to access those services as they are not commercially available, when the majority of citizens already have access. It also protects citizens where legacy services are in danger of being withdrawn or not provided at an acceptable quality standard when there is no affordable alternative.

With regard to broadband, the current legislative framework does not allow for a universal service obligation, USO, that includes high-speed broadband. Previous Government policy interventions have been used to bring basic broadband to end-users. The NBP is designed to ensure high-speed broadband. The current obligations under universal service, that is, not broadband, were put in place by ComReg to provide a safety net to ensure that end-users can access voice and other basic services.

A new framework has been adopted in EU law. It has not yet been transposed but it is due to be transposed into national law by the end of 2020. This makes provision for member states to use a USO to ensure that adequate broadband is available to all end-users. It is for member states to define "adequate broadband" in the light of various criteria and of national conditions.

This USO mechanism is not intended to replace public policy interventions such as the NBP or a commercial roll-out. Instead, the new framework permits a USO only to be used to ensure the connection of remaining unserviced premises where the commercial roll-out and public policy interventions cannot achieve that. It does not allow a USO to replace a public policy intervention such as the NBP, which must be carried out in advance of the consideration of any USO being required to be put in place, as necessary. If a USO were implemented, there would need to be an open process to select the universal service provider or providers so that all interested parties could be considered and market distortion is minimised.

While transposition of this legislation is required by 21 December 2020, subsequent analysis regarding the necessity for a broadband USO and any subsequent consideration of designation of a universal service provider, if appropriate, would require additional time.

Under the new framework, where the verified net costs are found to be an unfair burden, designated providers could be compensated for the verified net costs of providing the USO. The financing of the verified net costs could come from public funds, industry or both, depending on how it is transposed by the Department of Communications, Climate Action and Environment.

ComReg’s role under the new framework has yet to be determined.

(Interruptions).

Can we just concentrate-----

I am sorry-----

I know you might be getting direction from Fine Gael headquarters on the questions to ask but we might wait until the submission has been made before you do that.

We will let Mr. Blaney continue his opening statement.

Mr. Garrett Blaney

This will be made clear upon transposition. While there are some responsibilities set out for national regulatory authorities, the majority of requirements contained within the new framework are firmly placed on member states. ComReg anticipates that it may be assigned further responsibilities by the Department of Communications, Climate Action and Environment to carry out on behalf of the member state, that is, Ireland. However, the detail of such responsibilities will not be certain until transposition has been completed.

Some of the issues that may be raised by the committee are currently the subject of court proceedings and in the circumstances, it would not appropriate for ComReg to comment on them. I wanted to note that at the outset and I hope members will bear with us on that.

I thank the committee for the opportunity to appear before it today and make this statement. We are happy to take any questions on this statement or any other matter.

I thank Mr. Blaney for his presentation. He says the legislative framework to proceed with a universal service obligation, USO, in the provision of broadband is not available here as a result of the non-transposition of EU legislation. That is something in which the Department is actively involved.

Mr. Garrett Blaney

It has to be done by the end of 2020. The Department has started that process, but there is a lot more work to be done. We are happy to assist it in any way, if it would be helpful.

Does Mr. Blaney know of any European member state that has transposed the directive?

Mr. Garrett Blaney

No, none of them has transposed it, but there is provision for a USO in a number of countries. It is important to reflect the fact that the USO only applies to the small number of people who do not receive the services available to everyone else. I will provide an example. At previous meetings of the committee there was some discussion about the position in the United Kingdom where for 98% of people broadband speed is 10Mbps. The USO ensures the 2% who do not receive a service with such a speed will. It ensures that, in cases where the majority receive a service, the minority who do not benefit from it will not be left without it.

Do member states define the purpose of a USO? If Ireland had not envisaged the national broadband plan, there was no policy intervention on the horizon and we had the tools provided by the EU directive, including a USO, would Ireland be able to define the USO in such a way as to provide broadband for those who did not have it, in other words, for those included in the figure of 542,000?

Mr. Garrett Blaney

Our reading of the directive is that commercial arrangements must be attempted first. Clearly, that has not worked in the intervention area.

It is accepted that there is market failure.

Mr. Garrett Blaney

The directive states member states must then investigate policy interventions. There is a very clear hierarchy. Commercial arrangements come first and then policy interventions. It is only then, after policy interventions have been made, the USO provisions can be used. That is what is set out in the directive. Any transposition will have to reflect what is in the directive. That is very clear.

If the policy intervention was less expansive and had not sought to cover the figure of 542,000 but only to cover 100,000, could the USO then be used to provide a service for the remainder? It seems to be somewhat arbitrary because there is no definition of a public policy intervention. The only overriding principle underpinning the USO is that the rest must be covered, however many it might be, after attempting commercial arrangements and public policy interventions, for which there are no set criteria. Are there such criteria?

Mr. Garrett Blaney

The difficulty is that if one moves away from the principles of the USO, to give to the minority what the majority have, it is no longer a USO but more like a policy intervention.

Approximately 1.5 million premises in the State have high speed broadband, while 500,000 do not. Mr. Blaney seems to be suggesting the USO can only be applied to a much smaller group, but it is not defined.

Mr. Garrett Blaney

It would be a matter for consideration in transposition, but covering so many would not be in keeping with the experiences elsewhere. I will go back to the example of the United Kingdom where for some 98% of people there is a broadband speed of 10 Mbps which has been set as the level. The USO ensures the 2% who do not will get what the 98% have. If the figure of 2% was to become 20%, people might say it was no longer a USO but rather a policy intervention. We are only providing our interpretation of EU legislation. As it has not been transposed, ultimately, decisions about where exactly the threshold between a policy intervention and a USO should lie will be matters for consideration in the transposition process.

For the purposes of clarity, transposition is a matter for the Government.

Mr. Garrett Blaney

It is.

It is a devolved responsibility; therefore, in theory, the Government or the Department could set the scale.

Mr. Garrett Blaney

Transposition has to reflect the primary European directive.

Mr. Garrett Blaney

The Government would be challenged if it were to veer outside it. That is a matter for it to decide as it moves through the process. We are just telling the committee about what we have seen elsewhere. A USO has broadly been implemented to cater for the small number of customers left when the majority receive a service. We have seen this not only in the United Kingdom but in many other countries also. Many countries have made policy interventions that are not dissimilar to the national broadband plan and applied some USO afterwards as a safety net to capture anyone who has not been captured by then.

That provides clarity.

To move on to the discussion we had with Eir, I am sure ComReg will be familiar from media reports with its comments. The delegates may also be familiar with the position taken by the former chief executive, Mr. Moat, in his communications. He indicated that the process had become overly cumbersome, complex and burdensome. Based on what Eir told us, it would have required the company to set up separate structures, for oversight and so on, which would have added greatly to the cost of providing the service. Eir indicated to us that if many of the regulatory obligations required to be met by bidders were to be stripped away to create a level playing pitch on which everyone would be able to compete, it could deliver broadband for less than €1 billion, while the State was looking at spending upwards of €3 billion on the preferred bidder's proposal. Obviously, we are burdened in getting to the bottom of the matter and have to interrogate it to the greatest extent possible. We have to provide high speed broadband for the people who want it as quickly as possible, but we have to do so in a judicious and cost-effective way. Does the delegation have any comment to make on what Eir has stated about the procurement process and the overly burdensome requirements it believes are adding to the cost? Will the delegates share their thoughts from a regulatory point of view?

Mr. Garrett Blaney

Mr. Godfrey may wish to comment on the history as Mr. Mourik and I were not there at the time.

Mr. Jeremy Godfrey

Before I comment on the history, I may be able to help the Deputy to understand what the directive has to state about a universal service as those words are quite useful. The directive states a USO may be implemented in exceptional circumstances, where services cannot be ensured through normal commercial measures or other potential public policy tools. The test is whether other public policy tools can be used, rather than whether a member state wants to use them.

On whether it can be done, at the end of the day it is about cost. A state could provide everyone with high speed broadband and build a motorway to everybody's door if it so wished, but would it have the capacity or financial wherewithal to do so? That is where we are caught.

Mr. Jeremy Godfrey

I just want it to be clear that that is the test that must be passed. Exactly how it is interpreted-----

I mean no disrespect to Mr. Godfrey, but that is as clear as mud. Is that where transposition comes in?

Mr. Jeremy Godfrey

To return to the Deputy's question about governance processes, in the context of a state intervention, there are two significant elements of governance, one of which is looking after the State's money, that is to say, making sure the money is spent to achieve the objectives for which it was granted, making sure the network is rolled out according to the plans, making sure some of the profits of the operator can be clawed back if they are greater than envisaged when the subsidy was calculated and so forth. That is one part of the necessary governance - looking after the commercial and financial issues involved. It is not something in which ComReg is involved in any other circumstance.

There is also a set of governance requirements related to the behaviour of the winning bidder in the marketplace. What products, including wholesale products, does it offer? How are they priced? Does it treat all of its retail service customers equally? These matters are similar to the obligations ComReg might impose on an operator within our regulatory remit that has been found to have significant market power, but in this case they would be imposed on foot of the receipt of state aid. Under the guidelines, we are not limited to imposing such obligations on those with significant market power. ComReg does have skills and experience when it comes to the latter obligations.

It is envisaged in the governance process that ComReg would make available the skills and experience for governance but the precise way in which that would be done and the precise role that we would have are matters for the Department. In some ways both of those things would need to be done whatever model was followed.

Deputy Dooley asked whether we would comment on Eir's assertion that it could do the project for €1 billion. As a regulator, the advice we have provided to the Government on this process has been on matters related to where there has been market failure and what sort of obligations should be imposed. Under state aid guidelines, those are the issues that national regulatory authorities are expected to advise on. We have not been an adviser on the potential cost to the public purse of different scenarios. In any event, we have not had shared with us the information necessary to do that. What I would say in terms of the money is that it is a matter for the Department to assess the plausibility of the assumptions that underlie Eir's assertion. It is for the Department to assess whether there is a credible explanation of the differences between the assumptions made in the different scenarios. That is not something ComReg can comment on.

The questions I have relate to Mr. Godfrey's last answer to Deputy Dooley. They are repetitive to a degree but it is important that we get this clear and that I understand what ComReg is doing. Does ComReg regulation go as far as state regulation? Does ComReg deal with state aid?

Mr. Garrett Blaney

I will answer that. No, state aid, as committee members might imagine from the term, is a matter for the State. If there is a requirement for us to provide advice, we can do that but the formal process of state aid is for the member state. In this case, it would be a matter for the Department.

It is not a ComReg function. Is that correct?

Mr. Garrett Blaney

No, it is not a ComReg function.

Is ComReg's regulatory toolkit, including the power to impose fines - the second element of the carrot and stick approach - sufficient to oversee the national broadband plan? Has ComReg enough power to oversee the plan?

Mr. Jeremy Godfrey

I wish we had the power to offer advice. We do not have that in any circumstances.

The answer is "No", effectively.

Mr. Jeremy Godfrey

Our regulatory mandate extends to companies found to have significant market power not to companies which have state aid.

Effectively the answer is "No".

Mr. Jeremy Godfrey

The answer is "No". The regulatory toolkit or functions we have at the moment do not extend to ensuring that companies in receipt of state aid abide by the conditions of that state aid. That is not one of our functions.

ComReg does not have in its toolkit a power to issue fines or similar powers. Is that correct?

Mr. Jeremy Godfrey

None of our functions or powers relates to that matter.

This is something a reasonable bystander would wonder about if he was in the room with us. Why is there a difference between the type of regulation ComReg oversees for a company with dominant market power compared with a company receiving state aid?

Mr. Jeremy Godfrey

There is an overlap. As I mentioned to Deputy Dooley when I was discussing state aid, there are matters that have nothing to do with significant market power. These include looking after the money, ensuring that the networks are rolled out and so forth. The behavioural aspects of the obligations are in many ways similar. State aid guidelines encourage member states to align behavioural obligations to what might be imposed under significant market power, in particular, the requirement to treat all retail service providers in a non-discriminatory manner. However, the state aid guidelines also say it is perfectly reasonable and to be expected that some additional obligations might potentially be required in exchange for state aid. For example, under ComReg's regulation of Eir, there is a set of products we require the company to make available on a wholesale basis. The recommended products required to be made available in the state aid context are a somewhat greater set of products. We do not believe it is necessary or proportionate to require Eir to develop those products in commercial areas that it is required to develop in the other area.

There is another issue. ComReg's regulation of significant market power operates on a five-year cycle. Every five years we have to study the market and check whether one entity has significant market power. We have to check whether this causes competition problems and what the appropriate remedies are. Where it is envisaged for a state aided company, it is not unreasonable for the State to want to have the access obligations apply for the entire length of the contract.

State aid is effectivity for the Department. Is that the case? It is for the Government.

Mr. Jeremy Godfrey

Yes, there is no function for ComReg. There is nothing under European law that requires a national regulatory authority to supervise state aided companies by virtue of the fact that they have state aid.

Behaviour relating to marketplace product operations is part of ComReg's brief. Is that accurate?

Mr. Jeremy Godfrey

Behaviour in the marketplace is a matter for us in particular in regard to companies with significant market power. However, it is possible that, at least for some period, a company that receives state aid need not necessarily have significant market power. If the company does not have significant market power, it is only obliged to follow general obligations that apply to all companies in the market.

Mr. Godfrey has explained the difference clearly. I am finished.

I offer my apologies for being late. I have read the ComReg statement. Is there a difficulty with state aid if it can be shown that a state aid intervention makes a process more expensive than an alternative technological or business solution that could be applied? Is that not a risk in this circumstance? We have an existing operator that has real experience in rolling out broadband in rural Ireland. This operator is able to say it can do it and provide the same level of service, or close to it with slight variations, at a significantly lower cost than the state aid intervention. Surely it would be called into question under state aid rules if we were giving a better economic return in the state aid intervention than, it could be assumed, could be provided by an alternative operator. Is there not a difficulty with that? Are we not running into that difficulty?

Mr. Jeremy Godfrey

The question of state aid rules and how they apply is really a matter for the Department. As I said earlier, ComReg is not a regulator of state aid. I will reiterate what I said to Deputy Dooley. The question of whether it could be done cheaper is not something that ComReg is in a position to comment on.

What about the more general position? I presume the intention of our whole regulatory system and the whole European system is in a sense to avoid monopolistic outcomes within technology deployment areas. Is that a fair assumption?

Mr. Jeremy Godfrey

The whole tenor of European electronic communications law is to try to promote competition. Of course, it recognises that there are circumstances in which competition at network level is not practical or feasible. There may be market failure. There are some areas where it is feasible to have two or maybe more networks. There are some areas where it might be commercially feasible to have a network but in the intervention area there may be market failure and it is not even commercially viable to have one in that area. The state aid is in place to ensure there is a network. To avoid monopolistic outcomes at the retail level it has to be an open access network so that as many retailers as possible can compete. It recognises that there may be parts of the market where monopoly or market power is inevitable, or certainly present, and it may take time for it to disappear. In the meantime, the idea is to ensure there are not monopolistic outcomes in the retail market.

I suppose this is a political question in a way.

Is there any indication within Europe, where there is a monopoly, that there is a preference for state ownership of such a monopolistic network versus a privatised model? Is Europe blind to that? Is there any guidance as to whether private or public ownership of such monopoly assets is favoured?

Mr. Jeremy Godfrey

European law is entirely agnostic as to whether it is state-owned or privately-owned. It looks at the market position of an operator and imposes obligations if the operator has significant market power. That is the role of the independent national regulatory authority.

One of the outcomes of this approach the Government is taking is that it is creating a monopoly for rural Ireland, with large chunks of the country in a future network ownership that will not be undone. Once this contract is signed, that is the monopoly in place and it will be in place for the foreseeable future, even beyond the already long 25-year period. The Government is effectively creating a monopoly network provider. While there will be open access and so on, when it comes to the ownership, a monopoly network is being created for rural Ireland.

Mr. Jeremy Godfrey

It is very likely there will only be one network serving many of the premises in rural Ireland. As I said, if it is not commercially viable to build one, it is seen as less probable we will have network competition. In answer to a question that was posed to us by one of the bidders a few years ago about the interaction between regulation and the contract, of course, a rural monopolist would still be subject to regulation, potentially. If it was found to have significant market power, it would be potentially subject to regulation if it turned out the contractual obligations were no longer adequate to ensure open access, so there is that possibility. It may be a monopolist but it will have access obligations under the contract and, if necessary, supplemented under regulation later.

For any such supplementary regulation or other regulation, even after the period of this contract, it is very unlikely a regulator would be able to apply stricter terms than had been agreed in the original contract. The regulator would find it difficult to say that it would put the screws on when the company exited that contract.

Mr. Jeremy Godfrey

The regulator's job is to apply proportionate remedies based on the evidence we find at the time.

Eir has experience of delivering to rural houses. In its discussions with us, its representatives said the service terms are different and there is a higher connection charge in current area, and there is a dispute over whether the next-day repair percentage is different from the national broadband plan figure. More specifically, however, Eir said that with regard to the provisions for providing connection into a house, it has learned from experience that hanging it by wire is very feasible and works well, and may be technologically easier than it thought it might be when it started its process. It suggested that the national broadband plan, rather than following that example, is giving lucrative terms for any developer to use ducting instead of overhead wires, and to fund up to a €5,000 cost per house for the provision of such ducting. Who was it said recently that the State will have a digger ready to go up to every house and dig for the ducting? However, this will be at a cost of €5,000 to the public whereas Eir seemed to indicate it is not necessary. Does the regulator have any view on those key provisions for the last-mile connection and whether the Government is stitching in a more expensive, lucrative approach, when Eir, as an existing provider of similar services to similar houses, is saying it can be done cheaper using overhead wire technology, and that those terms are too generous?

Mr. Jeremy Godfrey

The terms of the national broadband plan contract are a matter for the Government and it is not something we have a view on. The question about any differences between what is in the contract and what Eir is proposing, and what difference that makes to the financials, is also a matter for the Government and is not something we are able to comment on.

Does ComReg have a regulatory role in regard to the existing provision of Eir services? Does it oversee or review the quality of service the company is delivering? Is there anything in regard to the 340,000 houses that should raise concern that Eir has run into technical or other difficulties?

Mr. Jeremy Godfrey

The way it provides its service in the 300,000 premises area is a matter for it, not us.

It is not regulated.

Mr. Jeremy Godfrey

It is not regulated.

Mr. Blaney said the USO only applies as the final piece in the jigsaw or the last resort. For many years we have been debating the USO for fixed-line and a range of different services. I have never heard the argument that the provision of a universal service is only the very last resort. We have regularly discussed this and legislation has been introduced in Europe relating to USOs, for example, in postal services. I have never heard the argument that it is the last resort.

Mr. Garrett Blaney

To be clear, what we are saying is that it is a safety net. There is an appropriate role for USO and it is very helpful for those people who are not getting services through the other mechanisms. However, that is inherent in any universal service and that is the way the processes work. It is the same for postal and right across the spectrum. It is where most people are getting a service but some people are not, and the purpose of the USO is to make sure that those who are not will benefit from the thing that everyone else is getting. As to the exact level at which the USO would kick in, and whether it would be 2% or 1%, we noted it is 2% in the UK, but those are matters to go through at the time and there is consultation to ensure we have whatever USO mechanism is appropriate. That is the principle behind USO generally.

With regard to the terms of ownership and whether there is a concession or gap model, we have heard various presentations and everybody involved in the process usually says that if, at this late stage, we were to look to switch to a concession model whereby the State would end up owning the asset, while we would still maintain the other elements of the service, it would mean a five-year delay. While this is an opinion as much as anything else, surely, even at this late stage in the process, it is open to the State to say that it has assessed the various options and a concession model is the more appropriate approach. I do not see why that would necessarily lead to a five-year review of the process and the need to restart it. We have experience of previous broadband projects that have been delivered in one or two years, effectively. Does ComReg have any sense as to whether that switch to a concession model brings difficulties? It may bring to difficulties for the developer but is it still a feasible option for the State side?

Mr. Jeremy Godfrey

The question of how long it will take is a matter for the Department. We would not run the process so we do not have a view on how long it needs to take.

I thank the witnesses for the presentation. I ask for clarification on ComReg's role in customer service. Does it have a remit in regard to customer service for Eir and the 300,000 customers in particular?

Ms Barbara Delaney

In terms of national legislation and where ComReg fits in with regard to consumer service and rights, the universal service regulations apply across the board to all undertakings, including Eir, mobile and so on. Our role is to uphold those rights and that covers a range of things that specifically relate to customer service, between contracts, switching and code of practice for complaints handling. Our role is very much across the board in terms of all undertakings, including Eir.

When it comes to the USO for phone and broadband, ComReg has a remit.

Ms Barbara Delaney

Absolutely. In terms of the contract with the customer, the end user, how that is upheld or not upheld from the retail perspective we are talking about, how the service that has been contracted is delivered to the customer and whether it is in line with the contract, are areas where we intervene if the rights are not upheld. That role will remain.

I refer to the question of when a USO will come in. To sum up ComReg's presentation in three or four words, industry roll-out would come first, followed by public policy intervention and this type of scenario would come after that. The UK model was roughly 2%. That is basically it in a nutshell. This model only addresses the remote areas affected in that scenario.

Mr. Garrett Blaney

The NBP is designed to cover everyone but there may be a role for the USO as some sort of safety net. As it is unclear who would not have broadband after the NBP is rolled out, that is a matter for future transposition. If there was concern that a safety net was needed, then the USO would be available. However, that is a matter for the transposition and for the Department.

If one wanted to appeal or change the terms and conditions of the USO, would that be a matter for ComReg or for the Government?

Ms Barbara Delaney

Can I clarify the Senator's question? He said if we wanted to change-----

I am not referring to ComReg wanting to change it. I will give an example. We currently have a USO for a fixed line, but it is proposed to change or review it. What is the process for that?

Ms Barbara Delaney

That is a good example. We have a fixed-line universal service obligation in place at present, which was put in place when the original network was rolled out. It was ubiquitous but there was a danger that some people still might not be served or that their service might be withdrawn. Were that USO to be extended or revised to cover other provisions, there is a process whereby one would analyse the new service and see who is providing that service in the market and so on. As Mr. Blaney said earlier, an open process would then be held to see whether there are any interested parties. No party can be excluded and therefore it is not a de facto that one provider or another would be the universal service provider. If the need for a USO has been established, there is an open process to see who might be interested in providing that USO and the process would move on in that respect.

Would ComReg or the Department run that process?

Ms Barbara Delaney

Under the current legislation, that process is assigned to ComReg. We do not know who will run it in the future as we must wait for the transposition of the new EU framework. The directive refers to member states and we will have to wait until the transposition has been completed to know whether ComReg has a role in future regulation.

Does ComReg or the Department deal with the current fixed-line USO?

Ms Barbara Delaney

We deal with it under the current legislation.

I thank the witnesses.

The joint committee adjourned at 11.03 a.m. until 2 p.m. on Tuesday, 16 July 2019.