What will be the UK’s ‘’redlines” in its Brexit negotiations on digital issues?
INTERNATIONAL INSTITUTE OF COMMUNICATIONS
UK CHAPTER EVENT
16 NOVEMBER 2016, London
HOSTED BY FRONTIER ECONOMICS
Charlotte Holloway, Associate Director of Policy, techUK
Lorna Woods, Professor of Media Law, Essex University
Malcolm Harbour, Digital Policy Alliance, former MEP
George Houpis, Director, Frontier Economics
Fabio Colasanti, Board Member, RAI Way; former President, International Institute of Communications
With the UK Government preparing to invoke Article 50, setting in motion the start of negotiations between the UK and the EU concerning the terms of the UK’s exit from the EU, there are many questions over how Brexit will impact Britain’s digital sector. With little clarity on the Government’s negotiating position, it’s far from clear what Brexit will mean for the country’s digital economy policy and its place in the Digital Single Market initiative.
While pointing out that negotiation “red lines” will depend greatly on the nature of Brexit – hard, soft or somewhere in between, our speakers provided insight into the complexities of the digital economy that will need to be navigated to ensure that the sector is not only protected, but can thrive in the new world order.
Charlotte Holloway, highlighting the importance of preserving access to EU’s ICT Single market, set out five key priorities for the UK ICT industry:
- To be open to talent
- To have maximum possible access to EU market
- To support maximum cross-border data flows
- To be open to investment in infrastructure, and
- To be open to all parts of industry, and act as a conduit to Government’s position/policymaking
She stressed the need for a transitionary trading relationship with the EU so that the UK does not fall back to WTO (only) trade access. In stressing this, Charlotte emphasized the role of the sector in accommodating the digitization of UK’s wider economy. Whilst the tech sector is agile enough to adapt to various forms of Brexit, any deal needs to allow the sector to effectively serve the rest of the economy.
Charlotte also stressed the importance of cross border data flows. With General Data Protection Regulation (GDPR) coming into force in 2018, and parts of the market already impacted by uncertainty around GDPR/privacy, the Government needs to think seriously about the best possible shape for adequacy between UK and EU regimes. Furthermore, the question of Intellectual Property Rights will have to be considered and protected.
To emphasize the need for international talent to perpetuate the UK’s internet success stories, Charlotte pointed out that half of the UK’s ‘unicorn’ start-ups have been founded by non-UK citizens. As such, the need for a fit for purpose talent migration policy from EU, EEA and beyond was vital to the industry.
On an encouraging note, Charlotte noted that the UK Government has been a very positive liberalizing force within the EU. In her view, still more can be done to ensure the Digital Single Market (DSM) truly helps innovation and start-ups. As such, there could be a role for the UK in ensuring that the DSM is a success.
In picking up this thread, Malcolm Harbour further highlighted that, as a key influencer in the communications sector, the UK helped create EU legislation that has been good for the nation. With Ofcom’s remit and powers much wider than most other European NRAs, it should continue to play its strong role as a European regulator. And, regardless of Brexit, the UK must retain Ofcom as an independent regulator, whose remit is guided by a framework similar to the current EU Telecom package.
Furthermore, Malcolm pointed out the importance of UK based players in the European mobile market. To that extent, Brexit negotiations should aim to preserve this framework if it is important to players. Operators must be treated without discrimination serving the EU from the UK. Companies like Vodafone have built their growth on the framework and the open market measures it secured.
Lorna Wood spoke about the E-commerce Directive and its minimum standards for information to users/consumers. It allows Member States to regulate but on country of origin principle (one stop shop) and a crucial intermediary liability exemption. If the EC act goes, so too does the legal base for e-commerce, including intermediary immunity, seriously impacting the UK tech sector. The Defamation Act and other content-related legislation may also fall with the EC Act, bar some clauses which were ‘primary legislation’. In terms of International Human Rights Law, there should be concern over Freedom of Expression as applied in the UK post-Brexit. As such, there will be a real need for intermediary immunity remaining in local law.
With an end to European passporting, UK companies (services) will ‘fall out’ of the single market. Lorna concurred with Malcolm that the UK has been a leader in developing the EU’s telecoms regime. Domestic policy should thus stay the same, but the question is how do we relate to our European partners, including do we remain in BEREC?
Lorna set out that in broadcasting, moving away from the EU should not entail much negative impact and could remove some constraints on the country’s operators. As for the audiovisual sector (with a question as to what it means these days), it would come under pressure from making fresh commitments due to the Trade in Services Agreement (TiSA) . The Government should avoid losing this regulatory approach.
George Houpis focused on one specific issue: examining how Brexit might impact international roaming charges. Acknowledging that there is no clear answer to this as yet, George went through the history of roaming regulation in Europe and described some of the commercial, economic and legal factors which could impact roaming charges.
In the ensuing Q&A and closing conversation, the panel and audience members expressed concern over the direction which the EU framework could take once UK’s positive liberalizing influence goes away. Ideally the UK will retain some influence and involvement in EU legislation, and Brexit negotiations should entail that retention of influence in some form, given the role that UK companies play in the sector elsewhere in the EU.
Delegates agreed that, in going into negotiations, the sector needs to present, to the UK Government, a better articulation of its importance to the economy and what makes it successful. From this, it was felt that the sector would then be in a better position to impress on government its “red lines” in the negotiations, such as being open to talent, ensuring data flow, and achieving the closest-possible-regime-to-single-market.
Debra Isaacson, Frontier Economics
Associate Director of Policy, techUK
Board Member, RAI Way; former President, International Institute of Communications
Director, Frontier Economics
Professor of Media Law, Essex University
Member of Council, University of Birmingham