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Goethe University Frankfurt a. M. a. Frankfurt University Goethe Deutsche Telekom Chair of Mobile Business & Business of Mobile Chair Telekom Deutsche Security Multilateral Rannenberg Kai Dr. Prof. 2015) (SS II Business Mobile
Regulation of (mobile) of (mobile) Regulation Telecommunications Lecture 9 …… ... 2
Agenda
Examples for Regulation Europe Regulation in Germany Regulation and DevelopmentFuturein of Origins of Regulation Origins Levels Regulation Definitions of Regulation of Definitions
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Regulation \ - “ rā ˌ
regulated also
- ə g
- re ˌ n, ə official
: sh
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the state of being being of state the
lā : ˈ
- ə Date: gy
- a rule or order issued by an executive authority authority executive an by issued or order a rule re
regulations ˌ
\
b:
agency of a government and having the force of law of force the having and government a of agency regulating Dictionary Definitions Definitions of Dictionary
regulation regulation reg·u·la·tion reg·u·la·tion 2 1 > ; > adjective noun an authoritative rule dealing with details or procedure Webster 2008] Webster - the act of act the the mechanism by which an early embryo maintains normal maintains embryo early an which by mechanism the regulatory Function: to conforming : development or 3 a: growth; tissue new of independent part lost or a damaged restore b: 1: 2 a: regulations Pronunciation: Pronunciation: Function: [Merriam . Main Entry: . . . . . Main Entry: . …… ... 4 ” for regulate one's habits> one's regulate regulations “ to bring under the under bring to regulate (1): to make to b (2): \ - rā ˈ also lāt the industries of a country> a of industries the ˌ - ə gy - re Dictionary Definitions Definitions of Dictionary ˈ regulate \ transitive verb transitive to govern or direct according to rule; rule; to according direct or govern to Webster 2008] Webster - to bring order, method, or uniformity to < to or uniformity method, order, to bring < of rate or degree, amount, time, the adjust or to fix the pressure of a tire> of pressure the or concerning < concerning or 2: 3: participle of regulare, from Latin regula rule regula Latin from regulare, of participle 1 a: authority constituted law or of control Function: reg·u·lat·ing reg·u·lat·ed; Form(s): Inflected past regulatus, Latin Late from English, Middle Etymology: Pronunciation: Pronunciation: [Merriam . . . . . . Main Entry: reg·u·late . …… ... 5 Description of Regulation Regulation Description of More Specific Specific More Definition and Market entry Market Pricing Offerings . . . Has a history long in telecommunications and broadcast Modifies Modifies general laws with to a regard certain industry to market failure owing Often Limits/enables Limits/enables scope of individuals action Limits/enables application of new technologies to e.g. to Limits/enables Limits/enables scope action of market players as ...... Public intervention intervention Public markets into . …… ... 6 Agenda Examples for Regulation Europe Regulation in Germany Regulation and DevelopmentFuturein of Origins of Regulation Origins Levels Regulation Definitions of Regulation of Definitions . . . . . . …… ... 7 Why Regulation? Why Hampered competition, Hampered competition, innovation, society progress The market price does reflect not the real costs of the system . . This different This occur may in ways. Consequence: Consequence: Market Failure Failure Market as for regulation reason a . . . …… ... 8 little other web browser other web browser ExamplesRegulation for : : : of market power against power against of market mail : monopoly high prices and inflexiblehigh prices service, service quality and high prices for international for quality and high prices service costs for competitors,for thefor former advantagescosts flatrate Volatile Volatile delivery of Exploitation Exploitation providers monopolist customer orientation Higher Formerly Formerly . . . . Postal monopoly Postal Microsoft trial Microsoft DSL Telephone Telephone . . . . …… ... 9 Types of Market Market Types of Failures …… ... 10 Externalities . ” Krahmer 1985; Ewers and Fritsch 1987] Fritsch and 1985; Ewers Krahmer - into a new infrastructure, others shave off the benefits. the benefit of the public since private efforts do not pay off. New Infrastrastructures: One Market player invests Basic Research: State subsidizes infrastructure for Investment Investment does not off.pay . . Examples: Actors Actors and beneficiaries are different: “ . . [Drüke 1999; Picot and Burr 1996; 1996; Meyer Burr and 1999; Picot [Drüke …… ... 11 Natural Natural Monopolies Krahmer 1985; Ewers and Fritsch 1987] Fritsch and 1985; Ewers Krahmer - Prices Prices and services need to be regulated. One (monopoly) supplier may supplier One (monopoly) at produce lower several costs competition. suppliers than in In industries limited costs industries fixed or high with In market potential, [Drüke 1999; Picot and Burr 1996; 1996; Meyer Burr and 1999; Picot [Drüke . . . …… ... 12 Dominant SupplierDominant Krahmer 1985; Ewers and Fritsch 1987] Fritsch and 1985; Ewers Krahmer - foster foster market entries or limit the market power of the dominant supplier. dominates dominates a market and harms competition and innovation . . . . Competition Competition surveillance may If a supplier If a [Drüke 1999; Picot and Burr 1996; 1996; Meyer Burr and 1999; Picot [Drüke . . …… ... 13 Political Failure Political Krahmer 1985; Ewers and Fritsch 1987] Fritsch and 1985; Ewers Krahmer - E.g. E.g. employment or goals social are goals not achieved by the market itself. . Then, state state may be necessary. Then, intervention Political achieved. not are Political goals [Drüke 1999; Picot and Burr 1996; 1996; Meyer Burr and 1999; Picot [Drüke . . …… ... 14 Regulation Regulation and Competition Let price drive competition new technologies into the mass market Encourage Encourage more national and international competition competition Foster through innovation . . . Purpose of regulation of Purpose . …… ... 15 [Drüke 1999] [Drüke ” Regulation Regulation and Welfare … justified … justified and accepted case in of market failures, failures, the market when i.e. fails to allocate maximizing way. a welfare resources in “ Regulation is Regulation …… ... 16 Agenda Examples for Regulation Europe Regulation in Germany Regulation and DevelopmentFuturein of Origins of Regulation Origins Levels Regulation Definitions of Regulation of Definitions . . . . . . …… ... 17 Regulation Regulation Levels National National regulation Regional regulation International International agreements (WTO) EU regulation . . . . Regulation is done on several several levels: on done is Regulation …… ... 18 … Selected Selected Examples – EU Level National National Level Regulation Levels Regulation globally Supranational Supranational Level (WTO) World Trade World Organization …… ... 19 … National Level National … … EU Regulation Selected Selected Examples (1) – National Level National National Level National Regulation Levels Regulation Europe in : Regulation failure? Regulation Bad luck in standardization? Market failure? . . . frequencies claimed Bluetooth claimed Bluetooth multitude multitude regulations of National National Sovereignty: national national regulation and EU regulation Within Within the EU: The French military . . …… ... 20 [REGULATION 717/2007] [REGULATION Selected Selected Examples (2) – Regulation Levels Regulation Europe in - - Roa of the of Verord “ 717/2007 ) ” Regulation ( Regulation within the Community the within ming on Public Mobile Mobile Public on ming Networks Telephone European Parliament and Parliament European on Council the of nung …… ... 21 could be be could ) ” ” ” EuGH Selected Selected Examples (3) “ – for the purpose of protecting of purpose the for [Court of Justice of the European Union 2010] European of the Justice of [Court Regulation Levels Regulation Europe in could be considered to be to be considered could that was claimed was claimed by mobile 717/2007 maximum retail charges retail maximum the object of the regulation is indeed to improve the conditions conditions the improve to is indeed regulation the object of the consumers against high levels of charges.of levels high against consumers “ and necessary appropriate “ it that and market internal the of functioning the for 95 EC. Article of basis on the adopted . . The European The European Court of Justice ( decided in June 2010 telephone telephone operators to be not valid. Regulation Regulation . . …… ... 22 Agenda Examples for Regulation Europe Regulation in Germany Regulation and DevelopmentFuturein of Origins of Regulation Origins Levels Regulation Definitions of Regulation of Definitions . . . . . . …… ... 23 History Areas and History Regulation in Germany:Regulation Broadcasting Mobile radio networks Radio amateur Telephone networks . . . . services, e.g.: historically. Separation technical of services and content Was developed over perioda long of time Some developments can be onlyexplained . . . …… ... 24 Regulation in Germany:Regulation Subjects and Competencies Subjects Competencies and (1) Data protection authorities, Authorities for the protectionminors, of and other authorities. Federal Ministry of Economics, Federal state media institutions, Availability. Access, Technology, Distribution, and Price, ...... Competence split between federal authorities and state authorities Regulationof: . . …… ... 25 und - Regulation in Germany:Regulation Subjects and Competencies Subjects Competencies and (2) synchronization and assimilation of Services) and Informations Kommunikationsdienstegesetz (ICT Law) 1997: Mediendienstestaatsvertrag (State Treaty for Media Intransparent Intransparent mesh of competencies One resolution approach: …… ... 26 ) ” Actors Regulation in Actors Bundestag “ Regulation in Germany:Regulation Agency) Responsibility ( Parliament Government Ministry Department / State governments Authority (e.g. Federal Network Supervision Licensing State State treaty Ordinance / Decree Ordinance Law Means …… ... (RSTV) Broadcast Federal states Federal Rundfunkstaatsvertrag No economicfreedom; freedom broadcast as (Rundfunkfreiheit) system dual institution; of bodies Supervision broadcasting the media state institutions; as well as institutions KEK and KEF (TMG) Services Tele & Media Tele Content Services Content Telemediengesetz Telemediengesetz Federation (Bund) Federation none Economicfreedom: no mandatory and admission no registration, supervision Regulation in Germany:Regulation - ante - (TKG) tionsgesetz Annex Services Annex Telekommunika Federation (Bund) Federation Voice Telephony and Telephony Voice Federal NetworkFederal Agency Limited economicLimited freedom: license ex obligation; controltariff Services Services Regulation relevant and - s media s ’ (TKG) gesetz gesetz Services Services Technical Federation (Bund) Federation Telecommunication Telecommunication Telekommunikations institutes over theover institutes network, cable broadband portability number mobile Agency Network Federal Limited economicLimited service freedom: universal regulation, tariff duty, of competencecontrol state federal the Institutions Responsible Responsible Specific Measures Regulation Competence Holder of Holder Relevant Law Relevant Category Service According to [Siemer2003] updated and [Siemer2003] to According …… ... - 2 ” /KDLM 1 anstalt Institutes Broadcast KEK Landesmedien “ Federal State Media State Federal Federal State Media State Federal Institutes Institutions to according law States Federal 18 MDStV 18 I 1 MDStV 18 I 3 18 MDStV 18 I 3 MediaServices Institutions to according § Institutions to according § Institutions to according § Federal Cartel Office Cartel Federal Tele Services Tele not explicitly explicitly not BPjS mentioned: of minors) (Prot. - ” Services and Supervisory Bodies and Services Supervisory Agency Services agentur Bundesnetz “ 38 38 BDSG Federal Network Federal Telecommunication Telecommunication § Federal Network Agency Network Federal to accordingOffices Protection Data Kommission zur Ermittlung der Konzentration im Medienbereich im Medienbereich Konzentration der zur Ermittlung Kommission der Landesmedienanstalten der Direktoren Konferenz KDLM: Data Protection Data Miscellaneous of Protection Minors Promotion and Promotion Advertisements, Regulation of Regulation Concentration Control Access Control Communication Variety, Chances of Chances Variety, According to [Siemer2003] updated and [Siemer2003] to According 1) 2) …… ... 29 ” ). ” (RStV)) ” ” ” (TKÜV) (TDSV) Gesetz (IuKDG) - ) ” and and ” ” Verordnung - Rundfunkstaatsvertrag “ Konsumentenschutz (ICT Law, TKG), Law, (ICT “ “ ” Datenschutz - und Kommunikationsdienste - Teledienstegesetz (TDG) Teledienstegesetz “ TelecommunicationsRegulations Telemediengesetz (TMG) Telemediengesetz Telekommunikationsüberwachungsverordnung Mediendienstestaatsvertrag (MDstV) Informations (TDDSG) Teledienstedatenschutzgesetz “ „Telekommunikationsgesetz “ “ “ (including “ „Telekommunikations State Treaty on Broadcasting ( Broadcasting on Treaty State 1996 2004 2007 – - rights, consumer protection ( International agreements on satellite communications … further regulations as to criminal prosecution, basic Since 2007 2000 1997 Since Since 1987 Since . . …… ... 30 License License Obligations (1) have have ongoing to fulfil also free vs. license free obligation license vs. holders - - License license. retain the order to obligations, in Licenses Licenses have to be assigned operations before start, preconditions i.e. there are a license for be to assigned License . . . …… ... 31 License License Obligations (2) enforcement, enforcement, criminal prosecution and protection of the constitution. Employment Employment of reliable personnel Provision emergency of numbers of police intelligence and Support services at e.g. law Proof of technical Proof of competence IT security security IT and protection data concept . . . . . Examples for continuous license obligations Examples continuous for Examples for license preconditions Examples license for …… ... 32 ” Ministry Ministry ” Federal ” its “ and and Regulatory Authority Regulatory “ ” Regulatory Regulatory Authority The The “ BMWi “ responsible responsible for post and telecommunications Supervision Supervision of Network Agency (FNA) Includes Includes former ministry post . . Federal Ministry of Economics Ministry Federal Economics and of Technology . …… ... 33 ” ; ” : separate higher federal higher separate : ” Regulierungsbehörde für für Regulierungsbehörde “ Regulatory Authority Regulatory (RegTP) “ ” Bundesnetzagentur 01 as 01 “ - 01 - The The 13 to the current name current the to 13 - 07 - , FNA) ” Federal Network Agency for Electricity, Gas, Electricity, for Agency Network Federal Telekommunikation und Post und Telekommunikation in 2005 Renamed the Federal Bureau of Post and Telecommmunications Telecommmunications and Post of Bureau Federal the (BAPT)). Telekommunikation und Post für (Bundesamt 1998 operations of Start According to TKG (1996) established as an authority under the under authority as an established TKG (1996) to According Economics ofMinistry the of supervision Telecommunications and Post of Ministry Federal from Emerged and (BMPT)) Telekommunikation und Post für (Bundesministerium Telecommunications, Post and Railway and Post Telecommunications, of Ministry Federal the of business of scope the within authority Technology. and Economics “ BNetzA . . . . . Federal Federal Network Agency ( “ . …… ... 34 ” (currently (currently the ” Regulatory Authority Regulatory “ s instruments s are: instruments ’ ) is to develop postal and ” ” Tasks Tasks Instruments and the of Regulatory Regulatory Authority “ Regulatory Regulatory Authority “ Sanction authority Information Investigation Federal Federal Network Agency . . . The The supervises the energy industry. telecommunications telecommunications markets by liberalization and deregulation. Starting 2005 the Federal Network Agency also The the task of The “ . . . …… ... 35 ” Rail Dept. Dept. 7 Regulation Authority Regulatory Regulatory Energy “ Dept. Dept. 6 Up Regulation 7 different - Team Start Management office Grid Expansion Grid administrative departments Dept. Dept. 5 Numbers Misuse of Reg. Offices Reg. Dept. Dept. Z Support Business Teleco. Dept. Dept. 4 Technical - Regulation IT Vice President Dept. Dept. IS President, & Security Dept. Dept. 3 Regulation Intl./Postal Organization Organization Chart the of Dept. 2 Dept. Frequency Reg. Issues Reg. Legal Teleco. Legal [Source: http://www.bundesnetzagentur.de/cae/servlet/contentblob/150968/ [Source: publicationFile/5919/100311OrgChartSept09Id10837pdf.pdf] Teleco. Dept. Dept. 1 Economics Regulatory 9 Ruling Chambers for several Regulation areas Regulation several for Chambers Ruling 9 …… ... 36 Agenda Examples for Regulation Europe Regulation in Germany Regulation and DevelopmentFuturein of Origins of Regulation Origins Levels Regulation Definitions of Regulation of Definitions . . . . . . …… ... 37 Regulation (1997) ” Current in development Convergence in Convergence “ EU regulation with EU regulation aligned rules, e.g. on services emergency call and voice and data fees roaming Telecommunications Greenbook . . Within Within the EU: …… ... 38 Future of Regulation Futureof telecommunications Request for a joint regulatory authority regulatory for a Request authority for joint . Within Within the EU: …… ... 39 Convergence Internet) is not limited to radio signals since digital ” Range technical services and content services is obsolete. of the infrastructure, content as service) “ services are ubiquitous ( Merging of infrastructure and services (radio as part Separation media,of services and transmission technology becomes obsolete owing to digitization Hence, the historically grown separation of . . . …… ... 40 - by - (ONP) for “ Convergence withinConvergenceEU the revision (e.g. addition of topics like preselection, call - National implementation had to happen swiftly. ONP call, number portability) Guidelines for user devices Data protection rules Licensing . . . . . 2006/07: Review of the EU Regulatory Framework for for Framework EU Regulatory of the 2006/07: Review electroniccommunications networks and services(ECNS) 2002: Electronic Communications Networks (ECNS) RegulatoryFramework 1996/97: Adaptation of ONP: of Adaptation 1996/97: 1990: Directive on „Open Network Provision telecommunicationsnetwork access within the EU . . . . …… ... 41 (Art. 86) (Art. (Art. 95) (Art. Directive Decision Spectrum on Article 7 Article on Liberalisation Recommendation Directive Rights Directive Rights ’ 2002 Electronic Communications Communications Electronic 2002 relevant markets relevant Recommendation on Recommendation Authorisation Directive Authorisation Users Access & Interconnection & Access Data Protection DirectiveProtectionData Networks (ECNS) Regulatory Framework Regulatory (ECNS)Networks SMP (Art. 95) Directive Guidelines on Guidelines Framework Source: Dr. Annegret Groebel, Bundenetzagentur Groebel, Annegret Dr. Source: …… ... 42 Art. 7 FD Results can Results vetoed be Remedies Remedies cannot be vetoed Regulatory process Regulatory and assessment and assessment of significant market power Guidelines Guidelines on market analysis solve the lack of competition of the solve lack Source: Dr. Annegret Groebel, Bundenetzagentur Groebel, Annegret Dr. Source: Market analysis significant market power Electronic Electronic Communications Networks imposition obligations of or Definition relevant of market Cancellation, confirmation or Assessment Assessment of effective competition 2003/311/EC Relevant Relevant markets Recommendation Recommendation on - 14 Art. FD 16 appropriate remedy appropriate Remedy should be effective be effective should Remedy the authorities choose (NRA) to national regulatory of Important role National level EC level …… ... 43 Reliance on Reliance competition law competition Principles of the Principles over, over, - Source: Dr. Annegret Groebel, Bundenetzagentur Groebel, Annegret Dr. Source: ECNS Regulatory Framework ECNS Regulatory cross neutrality Technological Harmonization rapidly changing rapidly market dynamics Market structures, Market regulators Flexibility for Flexibility …… ... 44 Agenda Examples for Regulation Europe Regulation in Germany Regulation and DevelopmentFuturein of Origins of Regulation Origins Levels Regulation Definitions of Regulation of Definitions . . . . . . …… ... 45 ExamplesRegulation for / electronic / electronic signature T) - obilecommunications roadcasting services roadcasting lectronic signatures lectronic E … M B . . . . Digital Countermeasures illegal against diallers License awarding Spectrum allocation allocation Spectrum for mobile communications Frequency Allocation Spectrum allocation allocation for radio Spectrum television and broadcasting (DVB ...... …… ... 46 Radio and Broadcasting Broadcasting and Radio Spectrum Internet radio broadcasting Not responsible for Internet television and Public and Public and private broadcasting corporations and Analogue digital transmission via cable and Spectrum allocation allocation Spectrum by tendering . . . . Administration Administration by state media institutions …… ... 47 speed wireless wireless speed - Frequency Allocation Allocation Frequency Mobile Communications Mobile for high for 800 MHz, 1,8 GHz, 2 GHz, 2,6 GHz) 2 GHz, 2,6 GHz, 1,8 MHz, 800 data transfer ( transfer data Most recent (May 2010): (May recent Most Frequency Allocation operation auctioned. were licenses Recent Determining frequency bandsfrequency Determining network mobile for licenses of Administration Administration of radio frequencies and issuing of of issuingand radio frequencies of Administration Agency. Network by Federal licenses . . . . …… ... 48 UMTS License UMTS Investments Network Network construction Coverage . . . government and and states government data Is UMTS telephony, service, broadcast? or Dispute Dispute over division between federal Auction amounted amounted costs license to tremendous Auction Strict license obligations as to . . . . …… ... 49 Digital and Electronic Signature Digital Electronic and Security related prerequisites Trust center control . . 2009. EU directive 1999/93/ECEU directive Furthermade to SigGin changes2007 2005, and EU directive 1999/93/ECEU directive 2001 Adaptationof andaccording SigG SigVto Ordinance(Signaturverordnung(SigV)) 1997 Adoptionof Germanthe Signature Act (SigG))Signature andSignaturgesetz(Deutsches . . . . …… ... 50 References(1) 202 Schriftenreihe „Regulierung - lex/pri/en/oj/dat/2002/l_201/ - , Wissenschaftszentrum f. Sozialforschung Berlin. , Wissenschaftszentrum Sozialforschung f. “ telecommunications, media and information technology sectors and telecommunications, mediatechnology sectors information and December 1997, Brussels, regulation, for the implications http://europa.eu.int/scadplus/leg/en/lvb/l24165.htm Telekommunikation − Regulierung und Deregulierung Zeiten derin Konvergenz, 99 technologischen FS II der Arbeit protection of privacy in the electronic communication sector communication sector privacy in the electronic of protection communications), electronic (Directive andon privacy europa.eu.int/eur l_20120020731en00370047.pdf /98_regpack/text_en.htm the data personal 12 and2002 July of of concerning the processing the Internal Market for telecommunications services through the the Internal through telecommunications services Market for L192, OJ implementation 24.7.90, Provision. Open Network of http://europa.eu.int/information_society/topics/telecoms/regulatory (1997) European Commissionon the convergence Green the Paper of Drüke, H. (1999) Regulierungssysteme in der internationalen COUNCIL OF THE AND PARLIAMENT 2002/58/EC EUROPEAN DIRECTIVE OF THE Council Directive Directive 1990/387/EECCouncil 28th June of 1990 the establishmenton of …… ... 51 und - - - References(2) (48:2). sb.de/BIJUS/rundfunk/rstv36.htm 29] - - 04 index.html ztbf - - Webster Online Dictionary: www.m - Webster 2008: Merriam - www.bundesnetzagentur.de/media/archive/10835.pdf in: Telekommunikationssektor, w.com/dictionary [visited 2008[visited w.com/dictionary Potential, in: Regional Studies (19.6). in: Regional Studies Potential, Technologiepolitik, in: Böttcher, Herder, Dornreich, Schenk Dornreich, Herder, (Eds.): in: Böttcher, Technologiepolitik, Jahrbuch (6). Ökonomie für neue politische curia.europa.eu/jcms/upload/docs/application/pdf/2010 06/cp100053en.pdf Krahmer, F. (1995) Innovation Behaviour Regional Indigenousand - Law: www.artikel5.de/gesetze/eu - Picot, A. and Burr W. (1996) and Burr A. undPicot, Regulierung Deregulierung im Organization FederalOrganization Chart Agency: Network Merriam German media supervision: www.jura.uni supervision: German media Meyer (1987)Fritsch J. den and Ewers, H. Gründen Zu staatlicher Forschungs EU Court of Justice of the European Union (2010): PRESS RELEASE 53/10, European No Union RELEASE the (2010): Justice of PRESS of Court …… ... 52 References(3) The economics of knowledge sharing: a new sharing: knowledge of The economics lex.europa.eu/LexUriServ/LexUriServ.do?uri= - www.bmwi.de/BMWi/Navigation/Service/gesetze,did=21996.html and evolutionary andeconomics. evolutionary Technology: Helmstädter (Ed.): Helmstädter institutional Cheltenham, approach, in horizons institutional New Elgar. http://ec.europa.eu/information_society/policy/ecomm/tomorrow/inde x_en.htm on roaming on public mobile telephone withinnetworks mobile the Community public roaming on on (2007), eur OJ:L:2007:171:0032:0032:EN:PDF Telecommunications regulations by the Federal Ministry of Economics and Economics the Telecommunications of Federal regulations by Ministry Siemer J.P (2003) Digitalization and Regulation Siemer (2003)Regulation J.P and− the Digitalization Case; German in: Ernst Roadmap for the Reform of the EU's Telecom Rules: Telecom the EU's of the Reform for Roadmap REGULATION 717/2007 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL THE OF AND PARLIAMENT 717/2007 EUROPEAN REGULATION THE OF