In addition to
independence, an effective regulator should demonstrate other characteristics,
including accountability, transparency and predictability. These traits
should be enhanced by a clear division of responsibilities between the ICT
regulator, ministries and other regulatory agencies, such as the competition
authority or radio spectrum management body where relevant.
The independence of the
regulator must be balanced with accountability. The regulator’s authority
provides it with significant power to redistribute income among different
constituents in the economy. Therefore, safeguards are required to ensure that
the regulator does not become corrupt or inefficient. Citizens and regulated
firms must know who is responsible for a decision and the reasoning behind the
decision. Interested parties must be able to provide relevant input to a
decision through consultation processes. They must be able to obtain redress
easily and quickly when the regulator has acted arbitrarily or incompetently.
These types of safeguards produce a balance between independence and
accountability. Several formal safeguards have been employed to achieve this
balance, such as:
- Publishing the statutes of the regulator that
clearly specify the duties, responsibilities, rights and obligations of
the regulator, as well as differentiating between primary and secondary
regulatory goals where there are multiple goals;
- Ensuring that the decisions of the regulator are
subject to review by the courts or some other non-political entity
although some “threshold” should be established to deter frivolous
challenges that simply delay the implementation of decisions;
- Requiring the regulator to publish annual reports on
its activities and requiring a formal review of its performance by
independent auditors or oversight committees of the legislature;
- Establishing rules for the removal of regulators if
they show evidence of misconduct or incompetence;
- Allowing all interested parties to make submissions
to the regulator on matters under review; and
- Mandating that the regulator publishes its reasoned
decisions.
Transparency in interconnection,
authorization
and licensing practices, and universal
service obligations is a specific requirement of the World Trade
Organization (WTO) and a general requirement of the EU regulatory package.
Transparency entails the regulator making available all relevant information in
a timely fashion. Transparency enhances the confidence of interested parties in
the effectiveness and independence of the regulator and strengthens the
legitimacy of the regulator. Consequently, all regulatory rules and policies,
the principles for making future regulations and all regulatory decisions and
agreements should be a matter of public record. ICT regulation is an important
policy issue, and all citizens need information about the policy to evaluate
the performance of government.
Transparency is an
important contributor to good governance in general. Importantly, transparency
reduces the probability that interested parties, especially those adversely
affected by a regulatory decision, will believe that decisions are biased,
arbitrary or discriminatory. The reasoning behind regulatory decisions,
including the principles and evidence that guided them, will be apparent when
they are clearly presented in the public record. Discriminatory or corrupt
decisions will become evident and more difficult to substantiate once
transparent processes are in place.
A successful market that
attracts investors requires a predictable regulatory process. Independent
regulators are predictable if they adhere to the rule of law. The most
important features of the rule of law are respect for precedent and the
principle of stare decisis, particularly
in common law jurisdictions. Respect for precedent means that regulators
do not reverse policy decisions unless there is evidence that those decisions
have led to significant problems or that new circumstances warrant a change in
the rules. The principles of stare decisis require that cases with the
same underlying facts be decided in the same way every time. This is of
particular relevance in the resolution of disputes. Adherence to these
principles enhances confidence in and the credibility of the regulator and reduces
regulatory risk, which reverberates positively with investors.