REGULATORY / LEGAL CONSIDERATIONS:Regulation of Voice over IP in the European Union, Numbering

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[IP Telephony Cookbook] / Regulatory/Legal considerations

Regulatory/Legal considerations -(.

-(. 8.1. Overall

For a legal classification of Voice over IP, several aspects have to be taken into consideration.

Where regulation focuses on technology - and there on the regulation of voice telephony - the

definition of voice telephony is the starting point for all further legal and practical considerations.

But when it comes to Voice over IP, terminology is used quite inconsistently.The lack of a clear

definition often leads to misunderstandings and also problems in the exact legal classification.

Internet telephony (or Voice over IP, VoIP) can be defined as a collection of Internet applications

for real-time voice traffic over data networks using the Internet protocol (IP) whereby the quality

of the transmitted voice depends on various factors such as available network capacity, gateways,

audio codecs used, etc.

For Oftel, "Voice over Internet Protocol (VoIP) is the generic name for the transport of voice

traffic using Internet Protocol (IP) technology.The VoIP traffic can be carried on a private

managed network or the public Internet or a combination of both. A wide range of applications

and services could use VoIP technology, from traditional telephone services to interactive games."

`Internet telephony' (also referred to as Voice over the Internet) - according to Oftel - "is a

specific type of VoIP service that uses the public Internet to carry the IP traffic."4

The ITU 5 uses different definitions depending on the nature of the principle underlying the

means of transmission.Therefore, Internet Protocol (IP) telephony is the transmission of voice, fax

and related services over packet-switched IP-based networks. Internet telephony and VoIP are -

according to the ITU - specific sub-sets of IP Telephony. Internet telephony is therefore IP

Telephony in which the principal transmission network is the public Internet. Internet telephony

is also commonly referred to as `Voice-on-the-Net' (VON), `Internet Phone,' and `Net telephony'

- with appropriate modifications to refer to fax as well, such as `Internet Fax'.Voice-over-IP

(VoIP) IP Telephony is then telephony in which the principal transmission network or networks

are private, managed IP-based networks (of any type).

-(. 8.2 What does regulation mean for Voice over IP?

Regulation in telecommunications intends to transfer a monopolistic market into a competitive

one.Therefore, especially in the beginning of the opening of the market, former monopolists face

strong obligations e.g., concerning access rights to their networks or price regulation.The target is

to give new entrant operators the chance to gain market share. For incumbent operators (the

former monopolists), regulation is therefore interfering with their business models and is a

considerable cost factor.

4. http://www.ofcom.org.uk/static/archive/oftel/publications/internet/2003/voip1103.pdf

5. See ITU Internet Reports 2001: IP Telephony, http://www.itu.int/ITU-D/ict/publications/inet/2000/index.html.

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Furthermore, regulation is based on public (provision of basic services to everybody) and state

interest (license fees).

Where Voice over IP services are exempted from regulation,Voice over IP faces some benefits in

comparison to classical voice services. In Asia and America, classical voice telephony is substituted

more and more by Voice over IP whereby positive cost factors of Voice over IP are partly

supported by regulation of classical voice telephony.To balance this - and to further uphold public

and state interests - a trend can be recognised that tends to also impose regulatory measurements

on Voice over IP services, the more mature and the more common those services become.

-(. 8.3 Regulation of Voice over IP in the European Union

Looking at regulatory measures in the European Union relating to Voice over IP, there have been

different approaches for quite a long time. On the one hand, there was the well- regulated PSTN

world and, on the other, the parallel world of the Internet or more generally of IP, where there

has been hardly any regulation perceived. In other words, telecommunications regulators were

used to concentrating regulatory interventions on traditional switched networks whilst packet

-oriented networks have been out of the telecom's legal focus.

-(. 8.3.1 Looking back into Europe's recent history in regulation

In the old regulatory framework,Voice over IP was exempted from regulation.The European

Commission stated in a Communication dating back to 1998 that Voice over IP services do not

face the common regulation set forth for voice telephony.The reason for that was the definition

of voice telephony in article 1 of the 1998 Voice Telephony and Universal Service Directive.

According to Article 1 of the ONP Voice Telephony and Universal Service Directive 6 "voice

telephony service" means a service available to the public for the commercial provision of direct

transport of real-time speech via the public switched network or networks such that any user can

use equipment connected to a network termination point at a fixed location to communicate

with another user of equipment connected to another termination point'. In other words,

commercially, directly transported and switched Internet telephony provided for the public in real

time is considered as being voice telephony, if the quality of service can be compared to ordinary

fixed or mobile telephony and if it is enabling any user to communicate with every other user in

fixed or mobile networks.

In its considerations, the Commission concluded that for the time being (which meant the time

of publishing the Communication) VoIP was not in commercial use and direct transport of real-

time speech via the public switched networks enabling any user to use equipment connected to a

fixed network termination point to communicate with another user of equipment connected to

another termination point was not available.The Communication was put under examination by

the Commission in 2000.The results were published in summer 2000 stating that, despite

technological developments and market trends,Voice over IP still does not underlie the regulation

for voice telephony.The reasons were low quality and reliability compared to traditional voice

6. Directive 98/10/EC of the European Parliament and of the Council of 26 February 1998 on the application of open

network provision (ONP) to voice telephony and on universal service for telecommunications in a competitive environment,

OJ L 101/24 as of 1st of April 1998.

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services and a lack of a distinct market for VoIP services (given the fact that VoIP services are not

offered as such, but - according to the Commission - always in combination with e.g., data

transmission).

Between 2000 and 2003 (when the New Regulatory Framework was published), the European

Commission did not publish any document on VoIP. A Communication is, as such, `soft law',

meaning that it does not have the same legal consequences than a Directive or a Regulation (e.g.,

there is no need for the Member States to transfer it into national law), even though it is a means

that it is often used to clarify things. Regarding Voice over IP there was legal uncertainty whether

VoIP could be considered as voice telephony and therefore being held as voice service with all

legal and practical consequences such as licensing and interconnection.With its Communication

the European Commission clarified that point for the time being and stated that VoIP was not

seen as voice service and therefore did not face voice telephony regulation.

In the New Regulatory Framework - which aims to be technologically neutral - the chance that

the European Commission will work on another Communication to clarify the legal status of

VoIP has been decreased. Electronic communications networks and electronic communications

services are facing the same regulation no matter which technology they are using.Therefore, the

basic answer to the question whether VoIP-services are facing the same regulation than PSTN-

voice telephony, will be yes provided that the service is offered to the public.

-(. 8.3.2 The New Regulatory Framework - Technological Neutrality

With the European Union's New Regulatory Framework things have been changing.

The Framework states the principle of technological neutrality, meaning that there is no longer a

distinction in the regulations made based upon technology between switched- or packet-based

networks and/or services.The new rules are applied to all electronic communication services and

networks. In other words, regulators today neither impose, nor discriminate in favour of the use of

a particular type of technology except where necessary.

At first glance, it seems that technological neutrality leads to less regulation. It seems as though

there were only generic rules and the market, as such, is developing according to market

principles. Looking more closely, a technology-independent approach might lead to even more

regulation, as potentially every network and every service then faces regulation in one form or

another.

Voice over IP is a good example of the covergence between the well-regulated world of switch

-fixed and mobile telephony and the Internet world, which has traditionally claimed independence

from any regulation. If regulation is applied in a technologically-dependent manner and Voice

over IP is not seen as voice telephony that falls under regulation (as it has been the case in the

European Union up till now), we are in a grey area where Voice over IP operators do not face the

same rights and obligations as traditional operators.This means, for example, that they do not have

to apply for licenses, do not get access to the numbering resources, are not permitted to

interconnection with others, etc.Where regulation is technology-neutral there is no

differentiation made. In such a system (lately introduced in the European),Voice over IP might be

considered as just another (voice) service facing the same rules as any other service based on

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another technology.Where the absence of regulation in the past seemed to foster the deployment

of Voice over IP, it is likely that the application of regulation now will slow down that process. But

in the long run, it seems to be almost certain that Voice over IP will win against traditional,

switched fixed and mobile telephony as sole voice communication service.

-(. 8.3.3 New Regulatory Framework - an overview

The above mentioned New Electronic Communications Regulatory Framework consists of one

general Directive, Directive 2002/21/EC of the European Parliament and of the Council of 7

March 2002 on a common regulatory framework for electronic communications networks and

services (Framework Directive)7 and four specific Directives:

- Directive 2002/20/EC of the European Parliament and of the Council of 7 March 2002 on the

authorisation of electronic communications networks and services (Authorisation Directive)8;

- Directive 2002/19/EC of the European Parliament and of the Council of 7 March 2002 on

access to, and interconnection of, electronic communications networks and associated facilities

(Access Directive)9;

- Directive 2002/22/EC of the European Parliament and of the Council of 7 March 2002 on

universal service and users' rights relating to electronic communications networks and services

(Universal Service Directive)10;

- Directive 2002/58/EC of the European Parliament and of the Council of 12 July 2002

concerning the processing of personal data and the protection of privacy in the electronic

communications (Directive on privacy and electronic communications)11 sector.

The Framework Directive provides the overall structure for the new regulatory regime and sets out

the policy objectives and regulatory principles that National Regulatory Authorities must follow. It

also requires that market analyses be carried out before regulation is imposed.The Authorisation

Directive establishes a new system whereby persons do not require prior authorisation before

providing electronic networks and services. It includes provisions relating to enforcement of

conditions and the specific obligations which can be imposed.The Universal Service Directive

deals with the obligation to provide a basic set of services to end-users.The Access Directive sets

out the terms on which providers may access each others' networks and services with a view to

providing publicly available electronic communications services. Finally, the Privacy Directive

establishes users' rights with regard to the privacy of personal data.12 The New Framework for the

regulation of electronic communications came into force in April 2002 and had to be transferred

into national law by the EU Member States by 25 July 2003. Only six Member States (Finland,

Denmark, Sweden, United Kingdom, Ireland and Italy) made it in time.13 The EU launched

infringement proceedings against the other Member States. Germany said it will transpose the

Directives by May 2004, Belgium by January 2004, Greece has still no timetable, the law in France

is still discussed in the Parliament, Luxemburg does not foresee a date, and the Netherlands expect

the new law in the spring and Portugal just approved the law in December.

7. http://europa.eu.int/information_society/topics/telecoms/regulatory/new_rf/documents/l_10820020424en00330050.pdf

8. http://europa.eu.int/information_society/topics/telecoms/regulatory/new_rf/documents/l_10820020424en00210032.pdf

9. http://europa.eu.int/information_society/topics/telecoms/regulatory/new_rf/documents/l_10820020424en00070020.pdf

10. http://europa.eu.int/information_society/topics/telecoms/regulatory/new_rf/documents/l_10820020424en00510077.pdf

11. http://europa.eu.int/information_society/topics/telecoms/regulatory/new_rf/documents/l_20120020731en00370047.pdf

12. http://www.oftel.gov.uk/ind_info/eu_directives/index.htm

13. See: http://europa.eu.int/information_society/topics/ecomm/all_about/implementation_enforcement/country_

by_country/index_en.htm

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-(. 8.3.4 Authorisation system instead of licensing system

Under the new regime, communications providers can offer (electronic) services and networks

without first having to seek permission or authorisation in terms of a license (exceptions are

possible for the allocation of scarce resources).The new system is based on the principle of a

general authorisation containing general conditions outlining the minimum obligations for

providers.This means that companies can offer electronic communication networks and services

(including Voice over IP) to end users without first having to notify or to seek permission of the

regulator.

With the new framework, it has generally become easier for network and service operators to

start off with the provision of their services. Especially for Voice over IP operators, this change

means a simplification compared to the previous situation where they had to take a decision

whether to provide a service that is not considered as voice service or whether to go through the

hassle of the (voice telephony) licensing process. Under the new regime,Voice over IP providers

and other (voice) providers have equal rights and duties e.g., concerning interconnection,

numbering, directory entries or emergency calls.

With the introduction of the new general authorisation regime on 25 July 2003, all classes of

telecommunications licenses were revoked.There are no different licenses e.g., for voice

telephony provided over fixed networks, for voice telephony provided over mobile networks or

for offering of leased lines.The differentiation between regional and national licenses also ceased

to exist as well as different terms and conditions in these licenses. Existing licenses, expired at the

end of July 2003, and were replaced by general authorisations. General authorisations, by

definition, (see Annex to the Authorisation Directive14) contain just general conditions. General

conditions may be financial contributions to the funding of universal service, administrative

charges, rules concerning Interoperability of services and interconnection of networks and

environmental and town and country planning requirements. Other specific conditions, such as

effective and efficient use of frequencies, can be imposed on individual communications providers

if they are using scarce resources.

-(. 8.3.4.1 Example: VoIP in the New Framework in the United Kingdom

The United Kingdom's regulator, Oftel15, recently took a closer look at the regulation of VoIP in

the new framework and published its findings. In summary, Oftel states that it is regulating VoIP.

The reason given for regulating VoIP services is that those services are `electronic communication

services' for the purposes of the British Communications Act 2003 ('the Act').The Act regulates,

amongst other things, the provision of `electronic communications networks', `electronic

communications services' and `associated facilities'.16 Oftel also concludes that interconnection is

likely to be relevant for electronic communication networks and services irrespective of the

underlying technology (e.g., circuit-switched networks or IP networks). It is still (just as in the

previous legal framework) possible to make a regulatory distinction between publicly available

14. http://europa.eu.int/information_society/topics/telecoms/regulatory/new_rf/documents/

l_10820020424en00210032.pdf

15. Oftel is now part of Ofcom. Ofcom began its regulatory duties on 29 December 2003. It replaces UK's five previous

regulators - the Broadcasting Standards Commission, the Independent Television Commission, Office of

Telecommunications (Oftel), the Radio Authority and the Radio Communications Agency.

16. http://www.ofcom.org.uk/static/archive/oftel/publications/internet/2003/voip1103.pdf

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telephone services and services that are not publicly available. Oftel says that specific requirements

for publicly available telephone services can be set forth in general authorisations.Where VoIP

services are not considered to be publicly available telephone services, those conditions will not

apply.

Oftel states that a VoIP service should be regulated as, a publicly available telephone service if any

of the following conditions apply:

- the service is marketed as a substitute for the traditional public telephone service, or

- the service appears to the customer to be a substitute for the traditional public telephone

service over which they would expect to access emergency numbers, directory enquiries etc.

without difficulty; or;

- the service provides the customer's sole means of access to the traditional circuit-switched

public telephone network.

Where a VoIP service is clearly being offered as an adjunct to a traditional telephone service or as

a secondary service it is, according to Oftel likely not to be considered as publicly available

telephone service. Oftel would, however, expect VoIP providers selling secondary services to

ensure that the customers and third parties using the VoIP service are fully aware of the nature and

limitations of the service.17

-(. 8.3.5 Numbering

A full E.164 telephone number is a string of up to fifteen decimal digits that uniquely identifies a

termination point in the global public telephone network. Every end-user connected to the

public telephone network, fixed or mobile has an individual number and all these numbers are

managed within the different national, regional or global numbering plans.The ITU deals with

the overall management of the world's numbering resources and assigns country codes to

individual countries (e.g., 49 for Germany, 33 for France, 44 for the UK, etc.), regional codes to

regions who request them (e.g., '3883' for Europe) and global numbers for worldwide use (e.g.,

the 00800 worldwide free phone code).

Traditionally, fixed network telephone numbers were used to identify endpoints and to route calls

to those endpoints.

For the deployment of Voice over IP services, numbering and access to numbering resources is

important. It is highly unlikely that the addressing system will switch from E.164 numbers to

URIs within a short time-period.Therefore it is important that VoIP services and endpoints can

be addressed using E.164 numbers. For a worldwide Voice over IP service that allows the

subscriber to connect from different points, it would be useful to have a worldwide service

number.That would need a decision taken by the ITU to install such a number.18

One has to bear in mind that national numbering plans have historically been evolving. A

sophisticated alignment of these numbering plans would cause major changes and problems to the

existing numbering plans. Such changes would also involve enormous costs.Therefore, it is more

likely that VoIP services will use numbers within the national numbering ranges than getting

distinctive numbers out of a newly-defined numbering range.

17. http://www.ofcom.org.uk/static/archive/oftel/publications/internet/2003/voip1103.pdf

18. In the past ITU-T SG2 had assigned the Universal Personal Telephone code +878 878 to be used for test reasons

until 22. October 2000.

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The European Commission states that the availability of numbers for existing and new services is

of crucial importance for competition and innovation. Member States should therefore design their

numbering plans in such a way that they can cope with increased future demand and they should

manage the existing numbering space to encourage efficient and effective use of numbers. 19

With Voice over IP being treated as any other electronic communication service,Voice over IP

providers are also entitled to get numbers from the national numbering range.

The European Commission says that numbers must be assigned to any undertaking providing or

using electronic communications networks or services, within three weeks after receipt of a

request. Procedures for assignment must be open, transparent and non-discriminatory. Short

codes, e.g., carrier selection codes, and so-called golden numbers, e.g., numbers that are easy to

remember, deserve special attention as they may represent a specific economic value. Member

States may decide to assign such numbers or codes via competitive or comparative selection

procedures, in which case, the assignment period may be extended until up to six weeks (Article 5

of the Authorisation Directive).20

Oftel says that communication providers may apply for public numbers for VoIP services in

accordance with the requirements set out in the General Conditions for the allocation, adoption

and use of numbers. Oftel considers about an appropriate number range specifically allocated for

VoIP services.21

-(. 8.3.6 Access

According to the Access-Directive (2002/19/EC), access means the making available of facilities

and/or services, to another undertaking, under defined conditions, on either an exclusive or non-

exclusive basis, for the purpose of providing electronic communications services. It covers access

to network elements and associated facilities, which may involve the connection of equipment, by

fixed or non-fixed means (in particular this includes access to the local loop and to facilities and

services necessary to provide services over the local loop), access to physical infrastructure

including buildings, ducts and masts; access to relevant software systems including operational

support systems, access to number translation or systems offering equivalent functionality, access

to fixed and mobile networks, in particular for roaming, access to conditional access systems for

digital television services; access to virtual network services.

Access is a generic concept covering any situation where one party is granted the right to use the

network or facilities of another party, on either an exclusive or shared basis. As defined in the

Access Directive, interconnection is a special form of access.22

The basic question here is whether VoIP providers can demand access from other operators and if

so, to what facilities and at what price.

19. http://europa.eu.int/information_society/topics/ecomm/all_about/todays_framework/public_resources/

index_en.htm#Numbers

20. http://europa.eu.int/information_society/topics/ecomm/all_about/todays_framework/public_resources/

index_en.htm#Numbers

21. http://www.ofcom.org.uk/static/archive/oftel/publications/internet/2003/voip1103.pdf

22. http://europa.eu.int/information_society/topics/ecomm/all_about/todays_framework/

interconnection_interoperability/index_en.htm#access

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The Access Directive lays down a procedural framework for regulators to follow, and identifies

factors to be taken into account when granting access, but does not specify precise access

obligations. In general, access obligations are only imposed on operators that have significant

market power in specific markets.Taking into consideration the above,VoIP providers are offering

electronic communication services.Therefore they are entitled to ask other operators for access

and enter into negotiations. Only operators with significant market power are obliged to offer

access in a transparent, non-discriminative and cost-oriented way, whereby the regulator has the

rights to control prices.

-(. 8.3.7 Interconnection

Interconnection covers the physical and logical linking of networks, and is an essential element in

any multi-network environment. It allows the users on one network to communicate with users

on other networks, or to access services provided on other networks. In a newly liberalised

market, terms and conditions for interconnection to the incumbent operators' network are critical

for successful market opening.

All operators of public communications networks in the EU have both a right and a duty to

negotiate interconnection with each other. In the event of a dispute, the national regulatory

authority may intervene.23

According to the Access Directive, interconnection is defined as the physical and logical linking of

public communications networks used by the same or a different undertaking in order to allow

the users of one undertaking to communicate with users of the same or another undertaking, or

to access services provided by another undertaking. Services may be provided by the parties

involved or other parties who have access to the network. Interconnection is a specific type of

access implemented between public network operators: interconnection being defined as physical

and logical linking between networks has to be understood technologically-neutral. In the past,

interconnection was PSTN-to-PSTN interconnection, meaning connecting homogeneous

networks based on SS7. In today's framework, interconnection can mean much more. Packet-

oriented networks must be enabled to be interconnected with line-switched networks and vice

versa.The basic questions to be answered in practical cases over the next months will be who is

going to be obliged to pay eventually for additional equipment needed to make interconnection

between heterogeneous networks possible. From a legal point of view, it will not be possible to

reject a request for interconnection based upon technology. Between operators that do not have

significant market power, interconnection pricing is a question of negotiation and insofar not

restricted.There is also only limited power for regulators to intervene. As soon as one of the two

operators involved in the case has significant market power, this one has to offer interconnection

based on transparent, non-discriminative and cost-oriented criteria.

-(. 8.3.8 Quality of Service

In traditional telecommunication networks (PSTNs), Quality of Service was the key point and

standardised quality requirements had to be fulfilled. In the PSTN, quality expectations

23. http://europa.eu.int/information_society/topics/ecomm/all_about/todays_framework/

interconnection_interoperability/index_en.htm

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concerning services have traditionally been very high.There are a lot of features that are not

regulated by law. Instead, features have been regulated by standardisation organisations.When it

comes to voice, there are a lot of requirements to be fulfilled, e.g., answering times and priority

routing for emergency calls.

Taking a closer look at the legal requirements, quality of service parameters, definitions and

measurement methods can be found in Annex III of the Universal Service Directive

(2002/22/EC). According to Article 11 of the same Directive, national regulatory authorities are

entitled to specify additional quality of service standards. In the UK, for example, the regulator

can impose technical interface standards to ensure end-to-end connectivity and interoperability.

Annex III of the Directive sets forth quality of service parameters, definitions and measurement

methods only. Operators are therefore obliged to measure the specific service-quality in their

networks and provide that data to the respective regulator.There are no specific quality

-requirements to be fulfilled by networks or services, nor threshold values that have to be met.

In other words, one could say that quality is not a regulatory obligation but a market request.

One has to consider the fact that there may be demand for cheaper services that may be of a

lower quality. Accordingly to that, Oftel expressed an interesting thought regarding quality

expectations. Communications providers should note that when VoIP services are provided using

traditional E.164 telephone numbers, calling parties may not be aware, in advance, that they are

calling a customer connected to a VoIP service.When providing a VoIP service that uses E.164

numbers, communications providers should take account of the quality of service that a calling

party would normally expect when calling an E.164 telephone number.

-(. 8.4 Voice over IP in the United States

Just as in Europe, the legal status of voice over Internet protocol (VoIP) services depends on the

decision whether to classify them as 'traditional telecommunications services' or 'information

services'. Should the Federal Communication Commission (FCC) decide on the former

classification,VoIP service providers will need to apply for licenses and to ensure that their

operations comply with the same state and federal regulations as their counterparts in the

traditional wire-line telephony arena.

On 1 December 2003, the FCC held a public forum on VoIP which was open to the public. 24

In his opening remarks, FCC Chairman Michael Powell stressed his belief that IP-based services

such as VoIP should evolve in a regulation-free zone. Even though topics like availability of

emergency services, contributions to the Universal Service Fund, full access for persons with

disabilities, safety for consumers, law enforcement and national security must be targeted and

discussed, nevertheless VoIP was already in the attention of regulators in some of the States. In

August 2003, the Minnesota Public Utilities Commission (MPUC) became the first US state

regulator to make a ruling on the issue, deciding that VoIP market leader Vonage should be classified

as a telecoms service provider, thereby needing to apply for a concession to operate in the state.

Vonage provides a service that permits voice communications over the Internet. It sells a service

called Vonage DigitalVoice that enables its customers to engage in voice communications, with

24. http://www.fcc.gov/voip/

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broadband Internet connections, using voice over Internet protocol (VoIP). It has customers in the

state of Minnesota.

In October 2003, the U.S. District Court (DMinn) overturned this decision and issued its

Memorandum and Order in Vonage v. Minnesota Public Utilities Commission, holding that Vonage

is an information service provider and that the MPUC cannot apply state laws that regulate

telecommunications carriers to Vonage.25

In Virgina, the State Corporation Commission has also taken notice of Vonage and is of the opinion

that it is subject to its jurisdiction.

In Ohio, the State Public Utilities Commission started an inquiry into how telecommunications

providers are using VoIP in Ohio to provide telecommunication services to Ohio consumers. It

turns out that under Ohio law, companies that are, in fact, `transmitting telephonic messages' are a

common carriers subject to the State Public Utilities Commission's laws.

The Florida Public Service Commission is awaiting on answers to the pending AT&T petition to

the FCC with regard to whether or not VoIP providers should be responsible for paying access

charges to local phone companies when they offer similar services.There is a bill pending in Florida

that will affect consumers living in Florida 26.

-(. 8.5 Conclusion and Summary

Regulation in telecommunications intends to transfer a monopolistic market into a competitive one.

In the past, telecommunications regulators were used to concentrate regulatory interventions on tradi-

tional switched networks whilst packet-oriented networks have been out of the telecom's legal focus.

In Europe,Voice over IP was exempted from regulation up to mid-2003.The European

Commission stated in a Communication dating back to 1998 that Voice over IP services do not face

the same regulatory burden than other voice services because they were not in commercial use and

direct transport of real-time speech was not possible.

With the European Union's New Regulatory Framework, things have been changing. The

Framework states the principle of technological neutrality, meaning that there is no longer a

distinction in regulation made based upon technology between switched-or packet-based networks

and/or services. Under the new regime,Voice over IP providers and other (voice) providers have

equal rights and duties concerning authorisation, interconnection, access, numbering, directory

entries or emergency calls. In other words, publicly offered Voice over IP is now regulated in Europe.

In the US, the legal status of voice over Internet protocol (VoIP) services depends on the decision

whether to classify them as 'traditional telecommunications services' or 'information services'.The

US regulator, FCC, has not taken a decision on whether to classify it one or the other way.

Should the FCC decide on the former classification,VoIP service providers will need to apply for

licenses and to ensure that their operations comply with the same state and federal regulations as

their counterparts in the traditional wire-line telephony arena.

25. http://www.techlawjournal.com/topstories/2003/20031016.asp

26. The Florida State Senate's VoIP Bill is available in the Internet, see http://tinyurl.com/b5nb/.

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