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EC approves 38 million in aid for open (fibre) broadband network in Rivierenland; Legal ICT proud to assist

| 17 April 2018

Some time ago, the cooperating municipalities of the Rivierenland Region, part of the Gelderland province in the Netherlands, embarked on a project to guarantee fast Internet access (‘fast Internet’ in short) for all citizens.

Market providers not able or willing to guarantee fast Internet access

Having received complaints from citizens, mostly in rural areas, about a lacking coverage of fast Internet, the Rivierenland Region decided to investigate the problem, and see what could be done about it. Upon request of the Rivierenland Region, market providers proved not able or willing to (help) guarantee fast Internet on approximately 12.000 rural addresses. For this reason, the municipalities of the Rivierenland Region took up the challenge to investigate whether they themselves could create a modern open passive (fibre) network to guarantee the availability of fast Internet for all citizens.

Justified governmental intervention

To solve the problem, the Rivierenland Region devised a measure where they are to establish a new public entity to tender out, under EU public procurement rules, the construction of an open physical broadband network. For this intervention to work, it was necessary to apply aid (a guarantee on a bank loan, provided without remuneration) for which approval of the European Commission (EC) was required. Therefore, a formal notification procedure was initiated with the EC. The result of this effort is now finally known: the Rivierenland Region appears to be the first region in the Netherlands that has obtained permission from the EC to construct a (fibre) broadband network.

The EC agreed with the Dutch authorities that the proposed intervention in the Dutch broadband market was justified, as it deemed the overall impact on competition to be positive.

Positive effects of the measure

As devised, the measure will have the following important benefits for rural citizens: they are not required to pay for the construction of their connection, they can receive services (such as Internet access, television and telephony) for similar prices as inhabitants of densely populated areas, and they don’t have to pay any surcharge for their subscriptions (as is sometimes charged to inhabitants of rural areas). Of course, citizens are not required to purchase any subscriptions for services on the network. Moreover, the fact that the network will be open to all service providers on fair and equal terms, improves competition and freedom of choice for connected citizens.

Fibre or equivalent

Although fibre is mentioned in the official EU Broadband Investment Guide as ‘the ultimate long-term solution for broadband’, as fibre is widely renowned, the EU guidelines for applying state aid for broadband require aid measures to be technologically neutral. Therefore, an alternative network technology could also be chosen, if this technology is equivalent to fibre and provides the best price-quality ratio for the network.

Legal ICT proud member of the Rivierenland Region broadband team

The Rivierenland Region’s continuing commitment and effort to ensure the availability of fast Internet access for all is commendable and makes me proud to be a member of the Rivierenland Region’s broadband team, on behalf of Legal ICT.

What can local governments legally do to ensure fast internet access in rural areas?

If you would like to know more about guaranteeing fast Internet access for all, please be referred to our Broadband Fact sheet.