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communications framework takes that uncertainty into account, for instance
by relying on an economic analysis (inspired by competition law) for the
most significant part of regulation (the SMP procedure), and by introducing
the principle of technological neutrality.
By now, another consequence of that uncertainty should also be
acknowledged, namely that there is no right answer to most - if not all -
major regulatory dilemmas. Instead, regulatory decisions essentially tend to
involve policy trade-offs. For instance, short-term gains in consumer welfare
from lower prices and increased competition routinely have to be weighed
against longer-term gains from investments in new technologies and
increased dynamic efficiency 6. Similarly, the interests of one category of
customers often have to be balanced with those of another category 7.
If regulatory decisions involve trade-offs, then not only is there no right
answer, but furthermore the decision cannot be modelled as a simple two-
step process, namely the setting of a norm (by an institution endowed with
legislative powers) and its application to a set of facts (by an institution
endowed with executive/administrative powers).
It seems more accurate to model the process as a chain of decisions,
each involving a further refinement in the trade-offs, always with a view to
dealing with uncertainty as effectively as possible. At each step, complex
inquiries and trade-offs are involved, ranging from the choice between
symmetric and asymmetric regulation to the choice of cost basis and its
implementation.
It is against that background that the procedures governed by Articles 7
(Commission review and veto) and 4 (judicial review by national courts) will
be examined.
6 This is, of course, the core of the debate concerning investment in so-called next generation
networks.
7 The regulation of mobile termination rates implied that the interests of the users of fixed
communications (who paid high termination rates to call mobile subscribers) were given priority
over those of mobile subscribers (who benefited from the net wealth transfer from fixed to
mobile), contrary to the previous staus quo. Of course, most fixed users are also mobile
subscribers now, so that the overall wealth transfer might not have been that considerable.