Organizational Structures
Determining the ideal organizational structure for a regulatory authority requires an assessment of various factors including: the country’s needs and objectives; political environment; legal requirements; and available expertise in the labor market.1 There are essentially two models of leadership organization for regulatory authorities: (i) the collegial body (a board or commission composed of multiple members); and (ii) the single regulator (often given the title of chairperson or president). Each has its advantages and disadvantages, and variations of each model are in use around the world.
The collegial body model usually involves a board or commission made up of individuals with different areas of expertise, potentially bringing those varied perspectives to bear on each regulatory issue. In addition, a collegial body could be seen as more independent, as it is less likely that all members would be influenced by the same actors, whether in the government or the private sector. Collegial bodies also often impart a sense of legitimacy in decision-making, as it is less likely that a single individual was responsible for any particular decision. However, as in any decision-making process involving more than one actor, the development of regulatory decisions can be a slower process and more subject to internal struggle.
By comparison, the single regulator model has the potential benefit of a consistent approach to regulation and decision-making, as decision-making authority is vested in a single individual who may have a unified plan for the telecommunications sector. In contrast to the collegial body model, single regulators can make decisions much more quickly, even when constrained by due process regulations. However, the single regulator is also potentially more vulnerable to undue influence exerted by external actors, whether in the government or in the private sector. In addition, a single individual may not be able to match the expertise of a collegial body made up of individuals from different backgrounds, although experienced staff can provide substantial expertise.
The number of regulators led by collegial bodies and single regulators continues to fluctuate as governments restructure their regulatory frameworks for telecommunications. However, based on responses received by the ITU to its annual Telecommunications Regulatory Survey during the past two years, approximately 75 per cent of the regulators are collegial bodies with the remaining 25 per cent constituting single regulators.2 Based on 2005 data,3 it can be seen that there are significant differences between the balance of collegial bodies and single regulators in various regions. (See Figure 6-A.)
In the Americas, 20 per cent of the 29 countries indicated that their regulatory agencies were headed by a single regulator, while among the 38 European/CIS states, 47.4 per cent reported regulators headed by a single individual. Approximately 30 per cent of countries from both the African and Asia-Pacific regions reported that they had single regulators, as did 25 per cent of the Arab states.4
Figure 6-A: Single Regulators and Collegial Bodies Regulators around the World
Management Structure
(a) Regulatory authorities headed by a collegial body
Almost two-thirds of the 131 countries that submitted responses to the 2005 ITU survey indicated that their regulatory agencies are collegial bodies.5 These multi-member commissions or boards of directors are composed of a varying number of members (usually an odd number from three to seven to minimize tie votes) that oversee and direct all activities of the regulator. One member is the chairperson or president of the commission/board and sometimes has a “casting” or deliberative vote that counts twice and acts as a tie-breaking vote, if necessary.
Depending on the appointment process of the regulator, collegial body members can be appointed by one single branch of government, multiple branches of government and/or other industry stakeholders. This issue is further discussed in Section 6.2 on Staffing and Remuneration.
Management and administrative functions
The day-to-day management and administrative functions of the regulator are handled in varying combinations by: an executive director, chief executive officer (CEO), the chairperson, and/or managing director (collectively referred to herein as managing director). In some countries, like Botswana, Brazil, Canada, Greece, Ireland, Jordan, Malaysia, Mexico, Portugal, South Africa, and Venezuela, the managing director of the regulatory authority is the chairperson of the commission/board.6
The managing director acts as a liaison between the commission or board of directors and the departments/divisions that comprise the regulatory authority. In the Dominican Republic, the managing director is part of the board and acts as its secretary, but does not vote.7 In Peru, the managing director of the Organismo Supervisor de la Inversión Privada en Telecomunicaciones (OSIPTEL) participates in the board of directors’ meeting sessions, but essentially acts as an observer and cannot vote.8
The duties and responsibilities of the managing director differ from country to country. In Bahrain, the general director not only handles the day-to-day affairs of the regulator, but also determines the internal structure and organization of the agency, and has authority to: delegate his functions to other agency staff; employ staff members and consultants; and establish conditions of employment for staff members (this last one with approval from the board).9 In Peru, OSIPTEL’s managing director is responsible for managing the regulator and carrying out the policies established by the board of directors and president of the regulator. In addition, the managing director is responsible for: the legal, administrative and judicial representation of the regulator; proposing policies and strategies for the development of OSIPTEL; developing the annual report and the regulator ’s budget for approval; and hiring, promoting, suspending and firing staff members (decisions regarding management staff members need approval from the board of directors and president of OSIPTEL).10
(b) Single individual structure
Single individual regulators are headed by a CEO, president or director general (collectively referred to herein as CEO) who oversees all policy, management, and administrative activities of the regulatory authority. In most cases, the CEO is appointed by the central government, often the minister responsible for communications. The term of office is fixed and generally varies from two to six years. However, in certain countries, including Estonia, Ethiopia, Iran, Liechtenstein, Norway, Oman, and Sudan, the CEO does not have a specific term of office.11
The duties and responsibilities of the CEO differ from country to country, but they are generally granted a broad scope of authority and responsibility. In Romania, the president of the National Regulatory Authority for Communications (ANRC) has a broad slate of responsibilities including managing the regulator, issuing decisions, approving the regulator ’s organizational structure, and acting as the liaison with high-ranking authorities and officials both in Romania and abroad12. In Guatemala, the Superintendencia de Telecomunicaciones (SIT) is headed by a superintendent who is responsible for managing and defining SIT policies, developing the regulator’s organizational structure, appointing and removing SIT employees, preparing its annual budget, and informing (at least twice a year) the Ministry of Communications, Transportation and Public Works of the regulator ’s activities and internal administration issues.13 In addition, recent global events such as the Enron and Worldcom incidences have led to the evolution and shaping of a broad body of corporate governance and reporting principles which are gaining wide acceptance globally. The move to define principles for corporate standards of performance has also been quite active leading to new legal requirements as shown by the King Report in South Africa and the Sarbanes-Oxley Act in the United States.
The CEO is typically assisted by one or more deputies to whom he can delegate responsibilities. For example, in Romania, the president of the ANRC is assisted by a vice-president.14 Similarly, in Denmark, the director general of the National IT and Telecom Agency is assisted by two deputy generals.15
Administrative Structure regarding Functions of Regulatory Authorities
Once the scope of work and type of management structure is established, a country must determine how the functions of the regulatory authority will be organized (e.g., whether by industry/service, function or project).
(a) Industry or service-based departments
Many regulators follow a vertical (all regulatory issues) structure comprised of departments that address specific services areas (e.g., broadcasting, telecommunications, and information technology) under the authority of the regulator, as well as departments typically responsible for operations and administrative functions.16
Denmark’s National IT and Telecom Agency, a converged regulator, is divided into seven departments/divisions: (1) telecommunications; (2) IT and Media; (3) frequency and technical; (4) IT security; (5) documentation and international coordination; (6) corporate IT; and (7) the administration secretariat. The Telecommunications, IT and Media and Frequency and Technical departments are further divided into smaller units that are responsible for specific issues such as public content, frequency, consumer and market affairs within those industries/services.17 Below is the organizational chart for Denmark’s National IT and Telecom Agency:
Source: http://www.itst.dk/mainpage.asp
In the case of Luxembourg, which has a multi-sector regulator, departments/divisions are responsible for the following industries/services: telecommunications, electricity, gas, postal and spectrum management issues. Similar to Denmark’s regulatory authority, each of these departments/divisions is divided into smaller issue-specific units.18
(b) Function-based departments/divisions
These regulators follow a horizontal (narrow range of regulatory issues) structure, but they cover all the specific service sectors that are regulated. Function-based departments/divisions have responsibility for areas such as: administration and human resources; enforcement; legal analysis; licensing; public relations; technical analysis and development; research and market analysis; user/customer services; and universal service fund administration.
For example, Chile’s Subsecretaria de Telecomunicaciones (SUBTEL), is divided into seven function-based divisions: Administration and Finance; Regulatory Policy and Market Analysis; Legal; Concessions; Enforcement; Universal Access to the Information Society; as well as a division for Strategic Planning, Management Control and Technological Policy. Each of these divisions is subdivided into units that are responsible for more specific topics. The Administration and Finance Division, for instance, is subdivided into five units that are responsible for finance, human resources, procurement, documentation, and a unit that handles information (including claims and suggestions). The Regulatory Policy and Market Analysis Division of SUBTEL is subdivided into three units, one for spectrum engineering and administration, one for economic regulation, and one for strategic studies.19
Malaysia’s Communications & Multimedia Commission (MCMC), a converged regulator, is also divided into function-based divisions. They include: Industry Development; Regulatory State Coordination; Technical; Resource Planning & Management; Monitoring & Enforcement; and Management & Support Services. Similar to the Chilean model, each of these divisions is then subdivided into topic-specific units. The Regulatory State Coordination Division is subdivided into two departments, one for regulatory coordination (which includes units for licensing and for universal service provision) and the other for state coordination (which includes a unit to manage regional office matters).20 Below is the organizational chart for Chile’s SUBTEL showing how this regulator has divided responsibilities by function:
Source: http://www.subtel.cl
Some regulators combine aspects of the industry/service and function-based structure models. The Canadian Radio-television and Telecommunications Commission (CRTC) divides the Commission’s responsibilities into the following departments/divisions: Broadcasting and Telecommunications Directorate; General Counsel Directorate; Communications Directorate; and Secretary General.21 The SIT of Guatemala distributes responsibilities among three main departments/divisions: telecommunications; administrative; and legal.22 Below is a diagram of Canada’s CRTC showing how a regulatory authority can combine both industry/service and function-based departments/divisions within its organizational structure:
Source: http://www.crtc.gc.ca
(c) Project-based departments/divisions
These regulators can be organized as either industry/service-based or function-based departments/divisions, but they have a horizontal structure because departments/divisions collaborate when a project needs the support and expertise of various competencies.23 Morocco’s Agence Nationale de Réglementation des Télécommunications (ANRT) is a function-based regulator divided into departments/divisions that deal with technical, administrative and operator issues, but has as a horizontal structure because staff members from units within these different departments/divisions are, as a matter of course, brought together to work on projects that require varied skills.24 The Malta Communications Authority (MCA) also utilizes a matrix organizational structure that allows the regulator “to adapt to change and maximize its expertise by shifting emphasis from a functional to a project-based approach.”25 Below is a diagram of Malta’s MCA, showing how this function-based regulatory authority uses a horizontal structure:
However, it should be pointed out that regardless of the departmental/division structure of the regulators, it is often the case that multiple departments and subunits will work together to accommodate the evolving needs of the telecommunications market, as well as facilitate and expedite internal procedures.
ENDNOTES
1 International Telecommunication Union, Trends in Telecommunications Reform 2002: Effective Regulation, Chapter 7, at 117-118 (2002).
2 ITU World Telecommunication Regulatory Database 2005.
3 Id. Including the most recent responses for countries which did not respond in 2005.
4 ITU World Telecommunication Regulatory Database 2005.
5 Id.
6 Id.
7 Dominican Republic, Ley General de Telecomunicaciones, No. 153-98 Capitulo XII, Titulo II, available at http://www.indotel.org.do/(mlvqnn555m5yeh45hbi0vb2v)/ley_153-98.aspx?article=17.
8 Reglamento General del Organismo Supervisor de la Inversión Privada en Telecomunicaciones
(OSIPTEL), 2001 available at http://www.osiptel.gob.pe/Index.ASP?T=T&IDBase=2728&P=%2FOsiptelDocs%2FGL%2FEL%5FSECTOR%2FMARCO%5FLEGAL%2FLEGISLACI%D3N%5FTELECOMUNICACIONES%2Fost%5F01%5F03%2Ehtm
9 Bahrain Telecommunications Law, 2002, available at http://www.tra.org.bh/en/pdf/Telecom_Law_final.pdf.
10 Reglamento General del Organismo Supervisor de la Inversión Privada en Telecomunicaciones (OSIPTEL), 2001 available at http://www.osiptel.gob.pe/Index.ASP?T=T&IDBase=2728&P=%2FOsiptelDocs%2FGL%2FEL%5FSECTOR%2FMARCO%5FLEGAL%2FLEGISLACI%D3N%5FTELECOMUNICACIONES%2Fost%5F01%5F03%2Ehtm
11 ITU World Telecommunication Regulatory Database 2005.
12 Government Ordinance No. 79 on the General Regulatory Framework of Communications, 2002 (unofficial consolidated text).
13 Ley General de Telecomunicaciones de Guatemala, 2002.
14 Government Ordinance No. 79 on the General Regulatory Framework of Communications, 2002 (unofficial consolidated text).
15 National IT and Telecom Agency (Denmark) at http://www.itst.dk/mainpage.asp
16 Sofie Maddens Toscano, Presentation on Organization, Structure and Function of NRAs, Accra (July 2005).
17 National IT and Telecom Agency (Denmark), at http://www.itst.dk/mainpage.asp
18 ILR Annual Report 2003, at 18.
19 SUBTEL (Chile) http://www.subtel.cl.
20 MCMC (Malaysia) http://www.mcmc.gov.my/mcmc/.
21 CRTC (Canada) http://www.crtc.gc.ca.
22 SIT (Guatemala) http://www.sit.gob.gt/organigrama.html.
23 Sofie Maddens Toscano, Presentation on Organization, Structure and Function of NRAs, Accra (July 2005).
24 See ANRT (Morocco) http://www.anrt.net.ma. See also International Telecommunication Union, Trends in Telecommunications Reform 2002: Effective Regulation, Chapter 7, at 120 (2002).
25 MCA Annual Report and Financial Statements 2004, at 43.