Digital Compliance In Europe: Regulatory Alignment Post-Brexit

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Despite the coronavirus pandemic, the process of implementing Brexit continues. One of the key Brexit issues for the tech sector is the extent to which the UK will either align or diverge its digital regulations with the EU.

Both the UK and EU have set out their intentions for their post-Brexit relationship in matters relating to technology, digital, and telecoms issues. There are signs that both the UK and EU will seek early alignment in key tech/digital compliance areas: is this a sign of things to come?

The UK government recently published its draft working text for a comprehensive free trade agreement between the UK and the EU (the “draft text”). As we explain below, the draft text covers (1) digital trade, recognising the importance of adopting frameworks that promote consumer confidence in digital services, (2) telecoms, and (3) audiovisual services. Intriguingly, the draft text aims to maintain regulatory alignment between the UK and the EU, insofar as possible, which could be a sign of the extent to which the UK plans to align with the EU (rather than forge its own path), both in these three areas and elsewhere, once the Brexit transition period is over.

Digital Trade

Net neutrality is a key feature in the draft text. In particular, the UK draft text sets out that both the UK and EU should “maintain or adopt appropriate measures to ensure that end-users in their territory are able to:

(a)           access, distribute, and use services and applications of their choice available on the Internet, subject to reasonable, clear, transparent and non-discriminatory network management;

(b)           connect devices of their choice to the Internet, provided that such devices do not harm the network; and

(c)           have access to information on the network management practices of their Internet access service supplier”.

The UK has already implemented the Open Internet Access Regulations and plans to retain it as part of its domestic legislation post-Brexit. These regulations safeguard equal and non-discriminatory treatment of traffic in the provision of internet access services and protection of consumers’ rights. Critically, the regulations restrict the paid prioritisation of internet traffic and discrimination or interference by internet providers (i.e., blocking or slowing down internet).

It is rare to see free trade agreements cover net neutrality as an area for discussion, but it appears in both the draft text and the European Commission’s draft agreement. Although the UK and EU negotiations are still ongoing, these provisions are an auspicious signal that the UK and EU plan to stay aligned on certain digital regulatory matters.

Telecoms

As with digital services, the EU and UK appear keen to preserve the status quo for telecom services. The provisions of the draft text (which line up with the Commission’s draft agreement) seek to:

  • ensure independence and powers of UK and EU telecom regulators;
  • minimise unnecessary formalities;
  • enable bilateral access to each other’s public telecoms networks and service and essential facilities; and
  • prevent anti-competitive practices.

The prospective management of international mobile telecoms roaming between the EU and UK is a grey area, however. For now, EU regulations limit wholesale fees for roaming and prevent higher charges being passed to consumers. At the end of the transition period, EU mobile operators may be able to charge UK operators (and therefore UK consumers) a higher rate for roaming services. The draft text proposes to solve this by requiring that, within three years of entry into a trade agreement, the UK and EU should come back to the table to assess whether there is a need to regulate mobile roaming between the UK and EU.

Audiovisual Services

This is one topic where the EU and UK could cease to be in step with each other. Currently, under the Audiovisual Media Services Directive, a broadcaster in the EU has to obtain a licence and comply with regulatory standards in only one EU member state; this then allows that broadcaster to offer its services in the other EU member states without any additional requirements (this is known as the “country of origin principle”). At the end of the transition period, a broadcaster that wants to broadcast to the EU but is licensed in the UK will no longer benefit from the country of origin principle. The draft text does not seek to negotiate a provision to mirror the country of origin principle, which could leave broadcasters having to seek dual licences for both the EU and the UK.

Jai Mudhar, London Trainee Solicitor, contributed to the drafting of this post.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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