Summary
4.The Act gives effect to the Government’s proposals for the reform of the regulatory framework for the communications sector, as set out in the Communications White Paper – A New Future for Communications (Cm 5010) – published on 12th December 2000.
5.The main provisions of the Act provide for:
	the transfer of functions to the Office of Communications (OFCOM) from the bodies and office holders which currently regulate the communications sector (which broadly speaking encompasses telecommunications and broadcasting) and manage the radio spectrum;
	OFCOM’s general duties in carrying out their functions;
	the replacement of the current system of licensing for telecommunications systems with a new framework for the regulation of electronic communications networks and services;
	the power to develop new mechanisms to enable spectrum to be traded in accordance with regulations made by OFCOM, and a scheme of recognised spectrum access;*In these explanatory notes, “spectrum” refers to radio spectrum (or radio frequencies) that forms a small part of the electromagnetic spectrum.  Radio spectrum is an important and versatile communications medium, used for terrestrial and satellite broadcasting, mobile telephony, fixed wireless access, and many other applications.  Radio spectrum is a finite resource and key issues in the effective use of spectrum include the efficient allocation and sharing of frequency channels (both domestically and internationally) and the need to ensure that radio signals from different users and services do not significantly interfere with each other.
	procedures for appealing decisions relating to networks and services and rights of use for spectrum;
	the development of the current system for regulating broadcasting to reflect technological change, to accommodate the switchover from analogue to digital broadcasting and to rationalise the regulation of public service broadcasters;
	the establishment of a Consumer Panel to advise and assist OFCOM and to represent and protect consumer interests;
	the establishment of a Content Board to advise OFCOM, and undertake functions on their behalf, in relation to the content of anything broadcast or otherwise transmitted by means of an electronic communications network and in relation to media literacy;
	the concurrent exercise by OFCOM of powers under the Competition Act 1998 and the Enterprise Act 2002 across the whole of the communications sector (including broadcasting); and
	the application of the merger control regime under the Enterprise Act 2002 to mergers involving newspaper and other media enterprises.
6.There are currently five bodies or office holders who exercise regulatory responsibilities in the communications sector and who will be replaced by OFCOM. These are:
	the Broadcasting Standards Commission, a non-departmental public body which has statutory responsibilities for standards and fairness in broadcasting. It has three main tasks, as established by the Broadcasting Act 1996 (“the 1996 Act”). These are to produce codes of conduct relating to standards and fairness; to consider and adjudicate on complaints; and to monitor, research and report on standards and fairness in broadcasting;
	the Director General of Telecommunications, who is responsible for running the Office of Telecommunications (Oftel) – the UK telecommunications regulator. Oftel is a non-ministerial government department. The Director General is responsible under the Telecommunications Act 1984 for administering and enforcing the licences that regulate telecommunications operators. His duties include those of ensuring that adequate telecommunications services are provided throughout the UK; of promoting the interests of consumers; and of maintaining effective competition;
	the Independent Television Commission, the statutory body which licenses and regulates independent television services in the UK, including cable and satellite. Operating under powers derived from the Broadcasting Acts 1990 and 1996, their responsibilities include setting and maintaining the standards for programmes, economic regulation, public service obligations, research, TV advertising regulation and technical quality;
	the Radio Authority, which is the statutory body responsible for regulation and licensing of independent radio broadcasting in the UK, that is to say all non-BBC radio services. Operating under powers derived from the Broadcasting Acts 1990 and 1996, their responsibilities include frequency planning, the awarding of licences, the regulation of programming and radio advertising, and the supervision of the radio ownership system; and
	the Secretary of State, as far as she has a regulatory role in respect of the allocation, maintenance and supervision of non-military radio spectrum in the UK. This role is exercised through the Radiocommunications Agency, an executive agency of the Department of Trade and Industry.
The Office of Communications Act 2002 establishes OFCOM and gives them a single initial function - to prepare to assume regulatory functions at a later stage. It also gives the existing regulators additional functions and duties to assist OFCOM to prepare.
7.One of the central objectives of the Act is the transfer to OFCOM of the functions, property, rights and liabilities of the bodies and office holders that currently regulate the communications sector. OFCOM will then develop and maintain new regulatory rules for the communications sector within the context of a single set of regulatory objectives, and in the light of the changing market environment.
8.In February 2002 the European Parliament and the Council of Ministers adopted four Directives (“the EC Communications Directives”), which set out a package of measures for a common regulatory framework for electronic communications networks and services. Provisions in the Act implement a significant proportion of this new regulatory package in the UK (see Appendices 2 and 3).