Eircom has criticised the way the telecoms regulator raises money from operators to cover its cost The company - which is the largest player in the market - has called for a more transparent process to ensure firms are not overcharged.
Eircom has also proposed the introduction of a new levy system based on the same one that is used by the British regulator, OFTEL.
Currently the regulator, Ms Etain Doyle, collects 0.2 per cent of telecoms operators' annual revenues to fund the cost of regulating the telecoms sector. She also generates significant income by selling spectrum to operators.
Last year Ms Doyle reported a €10 million operating surplus, while in 2000 she reported a surplus of €30 million. These surpluses were paid to the Exchequer.
Under current legislation surplus funds raised from spectrum sales should be paid to the Exchequer, but excess cash generated from levies should be refunded to telecoms operators.
But a new licensing regime proposed by the European Union may change the way regulators collect and account for their revenues.
In a submission to the telecoms regulator, Ms Etain Doyle, Eircom said it wanted to ensure that the 0.2 per cent levy on operators' revenues was used only for meeting regulation expenses and not passed on to the Exchequer.
"That would be essentially a form of additional taxation on the communications industry," Eircom's submission said.
The telecoms firm said the regulator had generated surplus funds of £24 million in 2000 and while these may have been generated by spectrum fees, the guidelines that determine whether excess of funds are paid to a central fund or refunded had never been made clear .
Eircom said it noted that since the Levy Order decreed that the amount should be 0.2 per cent of turnover and that this had clearly varied from year to year, it would seem unlikely that this had been the exact figure required by the Office of the Director of Telecoms Regulation (ODTR) to meet its expenses. But there had never been any refund to service providers, it added. "In summary, we believe it is necessary and appropriate to have a transparent process which assesses whether the levy has generated excess funds for the ODTR in a levy year and which returns the excess funds, if any, to the service providers."
Eircom made the submission as part of a consultation process on the future regulation of electronic networks and services, initiated by the regulator, Ms Doyle. In this consultation, which is based on a new regulatory framework proposed by the EU, she outlined that fees should be imposed in an "objective, transparent and proportionate manner which minimises additional administrative costs and attendant charges."
Eircom said it welcomed this proposal and would be in favour of an approach similar to the one followed by OFTEL where care is taken to only take the percentage of turnover from operators that is necessary to cover its costs.
"Each company sends in a declaration of turnover for the previous year and OFTEL calculates what percentage it needs to change in order to meet its costs. In this way the surplus is minimised in the first place," said Eircom.
Vodafone also said there should be more transparency on how fees are spent and on the outcome of work initiatives.
Chorus, which must pay a levy of 3.5 per cent of turnover because it is a cable television provider rather than a telecoms operator, said the rate of fees should be the same across the board.
Esat said that while fees should cover any administrative costs incurred by the ODTR, they should not be set at such as level as would discourage operators from applying for radio spectrum.
"The level of funds previously available to operators competing in Ireland and indeed across Europe is no longer available... fees should be set at a rate which takes cognisance of such economic and competitive conditions," said the firm,which is 50 per cent owned by Independent News & Media.
