Europe's Top Court Rejects 'Zero Rating' Again

European Court Reaffirms Stance Against Zero Rating

The highest court in Europe has once again ruled against the practice of “zero rating,” reinforcing that it violates the European Union’s regulations concerning open internet access.

Understanding Zero Rating

Zero rating involves mobile network operators offering commercial plans where data usage from specific applications – frequently popular ones – is excluded from a user’s data allowance.

This practice is considered contentious as it potentially undermines the principle of a “level playing field” on the internet, often referred to as net neutrality.

EU Regulations and Ongoing Challenges

The EU established its initial set of open internet/net neutrality rules in 2015, with implementation beginning in 2016.

However, concerns were raised regarding ambiguous wording within the regulations, suggesting that carriers might exploit these loopholes to compromise the fundamental fairness of treating all internet traffic equally.

Despite these concerns, some telecommunications companies within Europe continued to offer zero rating plans, prompting legal challenges to assess the strength of the existing law.

Following two rulings from the Court of Justice of the European Union (CJEU), the future of zero rating within the EU appears increasingly uncertain.

Previous Ruling on Telenor Hungary

In a significant decision last year, the CJEU determined that the commercial application of zero rating could restrict the rights of end-users, as defined by the regulation.

Latest Ruling: Vodafone and Telekom Deutschland

The court’s recent ruling, stemming from a challenge against zero rating practices by Vodafone and Telekom Deutschland in Germany – which included a roaming aspect – delivers an even more definitive conclusion.

The CJEU has shown little tolerance for the practice, stating that a “zero tariff” option differentiates between internet traffic based on commercial interests.

Specifically, excluding traffic to partner applications from a user’s basic data package contradicts the requirement for equal treatment of all traffic, without discrimination or interference, as mandated by the open internet access regulation.

Furthermore, any limitations on bandwidth, tethering, or roaming usage that are contingent upon activating a “zero tariff” option are also deemed incompatible with EU law.

Responses to the Ruling

Requests for comment have been directed to Vodafone and Telekom Deutschland.

The European consumer protection association BEUC, through its senior digital policy officer Maryant Fernández Pérez, has welcomed the CJEU’s decision, calling it “very positive news for consumers and those who want the internet to stay open to all.”

Impact of Zero Rating

Fernández Pérez emphasized that zero rating practices, such as those employed by Vodafone, can effectively lock in consumers and limit the full potential of the internet.

She added that zero rating is detrimental to consumer choice, competition, innovation, media diversity, and freedom of information.

Key Takeaways

• The CJEU has consistently ruled against zero rating practices.
• Zero rating is seen as a violation of net neutrality principles.
• The rulings are expected to have a significant impact on how mobile operators offer data plans within the EU.