Telecommunications in the United Kingdom!  by Erick Fabrizio and L. Michael GuardThe purpose of this site is to acquaint you with the Telecommunications environment in the UK with an eye towards business opportunities. You will find the site structured to facilitate your company's entry into the British market place.
A SHORT HISTORY OF UK TELECOMMUNICATIONS LEGAL, ECONOMIC AND REGULATORY ENVIRONMENT Protecting your product from IPR infringement Right to private ownership and establishment Protection of property rights Adequacy of laws and regulation governing commercial transactions Access to the laws of the United Kingdom Security Principal Growth Sectors Government's Role in the Economy Infrastructure Investment Climate Openness to foreign investment Major taxation issues affecting U.S. business Performance requirements/incentives Transparency of the regulatory system Labor Efficiency of the capital markets and portfolio investments Dispute settlement, including enforcement of foreign arbitral awards Facts & Statistics on UK Geography People Government Economy Communications Transportation Transnational Issues SIGNIFICANT INVESTMENT OPPORTUNITIES Recommended Business Opportunities Trade Barriers Use of agents and distributors; finding a partner Direct marketing Joint-ventures/Licensing Steps to establishing an office Selling factors/techniques Advertising and trade promotion Pricing products Sales service/customer support Selling to the government SOURCES OF ADDITIONAL INFORMATION ON THE UK Travel Advisory - Consular Information Sheet World Factbook U.S. Embassy United Kingdom - Open Government Web Server United Kingdom - Foreign & Commonwealth Office Government Officials Human Rights Report MAJOR PLAYERS IN UK TELECOMMUNICATIONS Department of Trade and Industry (DTI) Office of Telecommunications(OFTEL) The Radio Communications Agency The Radio Authority National Radiological Protection Board Central Computer and Telecommunications Agency Relevant European Bodies European Conference of Postal and Telecommunications Administrations European Radiocommunications Committee (ERC) European Committee for Telecommunications Regulatory Affairs (ECTRA) Satellites Current UK Telecommunications Service Providers Public Telecommunications Operators Associations & Bodies TECHNICAL ISSUES Standards |
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Before 1969-- The UK was in the PTT Model of government telecommunications. The General Post Office (GPO), a Government Department headed by a Government Minister (the Postmaster General), had a monopoly in UK telecommunications and postal services. This included the operation of the network and supply of all equipment. Kingston upon Hull City Council ran the network in the Hull area. 1969-- The UK started to enter the era of the Enhanced PTT Model through corportization. The Post Office Act 1969 established the GPO as a statutory corporation headed by a Chairman appointed by the Government. 1980-- The UK is well into the Enhanced PTT Model. Industry Secretary Sir Keith Joseph announced the Government's intention to restructure the GPO and relax the monopoly over terminal equipment and value-added services. In November the British Telecommunications Bill sought authority to divide the GPO into two separate organizations - Posts and British Telecom. 1981-- The Telecommunications Bill received royal assent. Apart from formalizing the split in the GPO, it also established new responsibilities for the British Standards Institution (BSI) and set up the British Approvals Board for Telecommunications (BABT) - a subsidiary of the British Electrotechnical Approvals Board. British Telecom began operating under a license and independent suppliers of telephones were permitted. 1982--The UK takes its first steps toward the Pro-competitive Model through the introduction of competition and privatization. BT began to sell telephones and install 'plug in' master sockets (as opposed to hard-wired installations). The Mercury consortium received a license to build and operate an independent network to compete across the full range of telecommunications services. BT telephone suppliers were permitted to sell in competition to BT. The Government published a White Paper (Cm8610) proposing the sale of 51% of British Telecom and the creation of OFTEL as the regulatory body. 1983--Mercury launched its first telecommunications services in the City of London. Licenses were granted to Cellnet and Vodafone to provide national cellular radio networks. The Telecommunications Bill was reintroduced. The Bill allowed for the selling of BT and setting up of OFTEL. Minister for Information Technology Kenneth Baker set out the 'duopoly' policy limiting the number of long-distance fixed-link operators to two - British Telecom and Mercury - for seven years. (Kingston upon Hull City Council would continue to supply the service in the Hull area.) He also announced further liberalization in equipment supply and maintenance. 1984--The Pro-competitive Model is reached, privatization finally occurs. BT became a public limited company. The Telecommunications Bill received royal assent on the 12th of April. A joint IBM/British Telecom proposal (known as JOVE) to run a managed data network was refused on the advice of the Director General because of the dominant position such a grouping would have occupied in the market. 51% of BT shares were sold to the public - a total of 3,012 million ordinary shares. The purchase price was 130p and the offer was 3.2 times oversubscribed. 1985--BT's monopoly on the supply and maintenance of the prime (first) telephone ended. The two cellular operators, Cellnet and Vodafone, began commercial service. Later in the year the operators were issued with revised 25-year licenses. The Director General invited applications for the running of national private mobile radio (in the old Band III frequencies) and regional London PMR networks. The Director General published his determination of the terms for the interconnection of British Telecom's and Mercury's networks. 1987--The EC published a green paper - Towards a Dynamic European Economy - on the development of telecommunications in the common market. The Under-Secretary of State for Industry confirmed that Cellnet and Vodafone would provide the UK part of the pan-European digital cellular radio service. OFTEL issued a consultative document on BT's contractual liability with its customers. The Director General signed a determination allowing Windsor Television (a broadband cable franchisee) to provide a telephone service in conjunction with Mercury - the first such determination. The Director General signed a determination allowing Mercury to provide a public call box service in competition with BT. This followed an OFTEL survey published in September, which showed only 77% of BT public call boxes in working order nationwide. By March 1988 a survey showed that over 87% of BT's call boxes were working. 1988--OFTEL published the payphone standard. This ended BT's monopoly on the supply of payphones to customers and meant that occupiers of pubs, shops, etc. could purchase and/or run their own payphones on their premises. Six licenses for specialized satellite services were granted (one way point-to-multipoint services). 1989--Following OFTEL's consultative document in 1987, BT introduced a compensation scheme for customers giving them £5 per day after two working days for delayed fault repair or provision of service. Alternatively, for proven loss, business customers could claim up to £5000 and residential customers up to £1000. The Director General recommended to the Secretary of State that suitably qualified installers and maintainers should be able to connect call routing apparatus without the pre-connection inspection by the network operator then required. A BSI scheme to qualify installers and maintainers was introduced in 1990. On OFTEL's advice the Department of Trade and Industry announced that three personal communications network (PCN) licenses would be awarded. The original licensees were Mercury PCN, Microtel and Unitel (all consortia). 1990--New mobile operators (such as PCN licensees) were told they would be able to sell direct to customers with safeguards for service providers. Steps began to allow existing mobile operators to market direct in the future. July OFTEL took action against four cable TV franchisees over delays in building their networks. This was the first such action. The so-called 'Duopoly Review' began with a Department of Trade and Industry consultative document. This looked at the undertaking to introduce no more long-distance fixed-link operators (apart from BT and Mercury) for seven years from November 1983. The review looked at many other aspects of the UK telecoms industry. On the last day of the year the Broadcasting Act came into force. Among many other provisions, the Independent Television Committee (ITC) took over from the Cable Authority in granting cable TV franchises. 1991-- The Duopoly Review white paper Competition and Choice: the Department of Trade and Industry published Telecommunications Policy for the 1990s (Cm1461). This set out government policy in many areas. Decisions announced included ending the duopoly policy and allowing international simple resale to destinations with equivalent freedom to the UK. HM Treasury offered for sale up to 1,350 million BT shares. This reduced the Government's ownership from 47.7% to 25.8%. The Director General issued a direction to BT aimed at ending the unfair cross-subsidy of its apparatus supply business which included the sale and rental of telephones and other equipment. 1993--Ionica L3 Ltd was granted a nationwide public telecommunications operator (PTO) license to run a telephone service using short-range digital microwave links. This was the first post-Duopoly Review PTO license. OFTEL published a consultative document on interconnection and accounting separation setting out proposals on how BT's businesses should be divided for regulatory accounting purposes. The first batch of broadband cable TV licenses were modified to enable operators, among other things, to convey voice telephony in their own right. 1994--Following a consultative review in 1993, the Director General proposed several changes in the operation of BT's Signatory Affairs Office (SAO) to encourage future competition in the provision of satellite services. The main objective was to obtain direct access to international satellite consortia for independent operators. OFTEL set out its three-stage plan to introduce better interconnection arrangements. Sprint, Telstra and WorldCom International received licenses to carry out a number of activities including international simple resale. The US Federal Communications Commission (FCC) announced that the UK met the US equivalence test for international simple resale. OFTEL published A Framework for Effective Competition. This was a wide-ranging consultative document looking at how the regulatory regime needs to evolve. It included four options for changing the interconnection regime and looked at other issues such as capacity charging for interconnection, regulating anti-competitive practices and universal service. Licenses were issued to AT&T and Concert (a joint venture between BT and MCI). 1995--UK starts to enter the Competitive Model. OFTEL published a major policy statement Effective Competition: Framework for Action following the consultative document published in December 1994. This policy statement considered the path regulation should take towards the goal of a competitive marketplace. Among the recommendations in the document are:
The publication of a consultative document on Pricing of Telecommunications Services from 1997 started the process of public discussion on the structure of price controls after July 1997 when the current controls in BT's license expire. The principal proposals were to introduce a network charge cap to act as a broad control on the interconnection charges which competing operators pay to BT and to move some services out of the controlled baskets where there is a clear prospect that they will be subject to increasing competition. Only a light price cap would then be applied to them, in line with OFTEL's deregulatory approach. In a statement on Fair Trading in Telecommunications, the DG published for consultation his views on how best to achieve fair-trading in the telecommunications market. Suggestions included proposed license amendments for all significant licenses and the deletion of a number of conditions in BT's license. 1996-- Consultative document on the Provision of Services over Telecommunications Networks was published, looking at ways of promoting more competition in the provision of existing and future services.
1997--OFTEL ordered BT to drop its "Winback" marketing campaign on the grounds that BT had discriminated unduly in targeting other operator's customers and that BT had failed to obtain OFTEL's consent to the below-cost element of the offer.
1998--OFTEL published Beyond The Telephone, The Television and The PC - II - OFTEL's first submission to the Culture Media and Sports Select Committee Inquiry into audio-visual communications and the regulation of broadcasting. OFTEL established guidelines on how it will respond to competition issues in the UK telecommunications market.
1999--An OFTEL investigation has found that developing competition is reducing BT's prices for leased lines to business customers on the higher bandwidth circuits.
A more complete history of UK telecommunications can be found at http://www.oftel.gov.uk/history.htm. LEGAL, ECONOMIC AND REGULATORY ENVIRONMENT The legal environment in the UK, while structured differently, is very similar to the United States. In fact, the United States' notion of due process came directly from the Magna Carta of 1215; "To no one will we sell, to no one deny or delay right or justice." A good collection of UK legal and political Web Sites are set forth herein to assist one in locating any specific UK laws or regulations. Fundamentally important issues to one interested in doing business in the UK are very similar to US laws. The sanctity of the contract is recognized and enforced. Intellectual property rights like patents, trademarks and copyrights are fully protected. Long-term political, economic, and regulatory stability, coupled with relatively low rates of taxation and inflation make the United Kingdom (UK) attractive to U.S. exporters and investors. U.S. firms doing business in the UK encounter a familiar language, legal framework and business practices. The UK imposes few impediments to foreign ownership, and no restrictions to the free flow of capital. Within the EU, Her Majesty's Government (HMG) is a strong defender of the rights of any British-registered company, irrespective of its nationality of ownership. Protecting your product from IPR infringement IPR protection in the UK conforms to the harmonized approach adopted by the EU, the World Intellectual Property Organization (WIPO) and GATT. The UK is a member of the "Paris Union" International Convention for the Protection of Industrial Property (1958 Revision), and the Bern Convention. The Patent Office and TradeMark Registry, an executive agency of the UK Department of Trade and Industry, afford trademark, UK patent and copyright protection. IPR infringements are remedied by civil litigation. The UK is highly receptive to U.S. goods, services and investment, largely due to the British perception of a shared cultural heritage. With its $1.25 trillion GDP, the UK remains the United States' largest European market and fourth largest market worldwide, after Canada, Japan and Mexico. The United States exported $36.4 billion of goods to the UK and imported British goods worth $32.7 billion in 1997. Right to private ownership and establishment Ownership and operation of private companies is governed by the Companies Act of 1985, administered by the Department of Trade and Industry. The Government has powers under the Mergers and Industry Act of 1986 to prohibit the takeover of important manufacturing undertakings by non-residents, and to prevent undue concentration of market share. The Department of Trade and Industry uses a transparent code of practice in evaluating bids and mergers for possible referral to the Monopolies and Mergers Commission. EU law limits foreign ownership of UK airlines to 49%. Protection of property rights The legal system protects established intellectual property rights, conventions, and agreements. a) Patents: Under the Patents Act of 1977, a patent application requires that an invention must be new, involve an innovative step, and be capable of industrial application. A patent cannot be granted for any invention used for any offensive, immoral or antisocial purpose, for any variety of animal or plant, or for a biological process used in its production. Patents are granted for a term of twenty years. b) Copyrights: The Copyright, Designs, and Patents Act of 1988 grants the originator the exclusive right to assign those rights, or to exploit them through copying, dissemination, publication or sale. Computer programs and semiconductor internal circuit designs are included as works that are protected by this Act. c) Trademarks: The Trademarks Act of 1938 prohibits the use of a mark identical to, or nearly resembling, a trademark registered by another person. A trademark may be removed from the register if a period of five years had elapsed during which there is no bona fide use of the trademark in relation to the goods in question by any proprietor. A trademark may be registered within more than one class, the registrations being associated (or linked). The same trademark may not be registered by more than one company, irrespective of the number of classes in which it is registered. d) Trade Secrets: Commercially sensitive information is not itself specifically subject to legal protection, but the misappropriation of such information from business premises may be subject to criminal law. Action under employment law may also be taken against an employee who, by disclosing information, breaches a contract with his or her employer. Adequacy of laws and regulation governing commercial transactions Common Law prevails in the UK as the basis for commercial transactions, and the International Commercial Terms (INCOTERMS) of the International Chambers of Commerce are accepted definitions of trading terms. Accounting standards and audit provisions used in the UK are the Generally Accepted Accounting Principles of the Accounting Standards Board. U.S. exporters and investors will find little of no difference between the United States and the United Kingdom in the conduct of business. Access to the laws of the United Kingdom
Security Security and privacy are hot topics in the UK. A recent article in the China Youth Daily (9/13/99) postulates that with the rise of the Internet, your country's border is now whatever Internet security can effectively secure. "Some believe that national borders do not exist on the Internet. Absolutely not! Borders on the Internet are Internet security! Some believe that the threats on the Web are only from "viruses" and "Hackers." Absolutely not! There are also threats from information hegemony and cultural infiltration! Today when we are entering a Web age, Web security has become an important indicator of a new and necessary concept of security for the state. The key to Web security is in grasping "web domination." Without "web domination" there is no Web and information security. In today's society, politics, economy, military, and social activities are gradually depending on networking. As a major infrastructure component of the state, networking will certainly become a main target of information warfare of the 21st century." http://www.sinopolis.com/ Coupled with a rising public concern over electronic privacy, corporations dealing in telecommunications are under intense scrutiny over any activities that gather, store or use, an individuals private information. Well-designed internal security programs and policies are essential for a new enterprise trying to win customers. Failure to use the latest security technology could expose a company to civil penalties in the event of a preventable loss of data. Most at risk would be those firms specializing in automatic bill-paying services where a strict liability exists arising out of a fiduciary relationship between the firm and the customer. UK and other EU financial institutions are also at risk from a variety of electronic crimes. Extortion is but one example that can have a major impact on your business. This article in The Register details the attempted extortion of a bank by a criminal threatening to expose customer account numbers obtained by cracking the bank's data base. http://www.theregister.co.uk/990920-000034.html As in the U.S., controversy exists over the government's role in electronic security. The use and control of encryption technology has placed telecommunications companies squarely in the middle between the government's need to protect the society from criminals and terrorists and the public's desire for privacy. Gary Spinks, writing in Total Telecom ("U.K. E-commerce Plan May Contravene Human Rights", 05 November 1999), states that while the UK government has abandoned the third-party key escrow plan, their current scheme may be so intrusive as to infringe on the EU conventions on human rights. "The U.K. government's proposed e-commerce legislation, containing new police powers to access encrypted e-mail messages, has been criticized by both the Trade and Industry Select Committee and human rights campaigners concerned that it may infringe the European Convention on Human Rights. The Electronic Communications Bill is designed to encourage electronic trading and on-line delivery of government services. But the Bill's Part Three proposals would give police, secret services and customs and excise officers the strongest legal powers in Europe to gain access to encrypted material." http://www.totaltele.com/view.asp?ArticleID=24540&pub=tt&categoryid=0 Complicating the picture will be new security and privacy policy from the EU. Using the UK as a springboard for opportunities within the rest of Europe will entail considerable research on the rules in each country with respect to this issue. An excellent background article in the 9/27/99 ZDNet UK Surveillance Report can be found at: http://www.zdnet.com/zdnn/stories/news/0,4586,2342025,00.html An example of the impact that increased security regulations can have on the telecommunications industry can be found at the web site for The Register. A 10/9/99 article by Tim Richardson outlines the potential rules for backdoor access to the Internet that will fall on ISP's operations. http://www.theregister.co.uk/990910-000026.html Finally, it is important to remember that there are cultural differences between the U.S. and the UK/EU view of personal privacy and security. As pointed out by Randy Sparkman, a senior computer scientist for an international information technology consulting firm, "The contrast between the American and European approach reflects significant cultural differences. To Europeans, a name on a list can mean the loss of property, persecution, or even death. In the U.S., our analogous experience is the recurrence of Ed McMahon in our mailbox." http://www.hudson.org/American_Outlook/articles_sm99/sparkman.htm Principal Growth Sectors The UK economy is in its seventh consecutive year of economic expansion, although growth has begun to slow in response to falling Asian demand and a high foreign exchange rate. Coming to power in May 1997, the Labour Government has continued the economic reform programs of the former Conservative Governments. Notably, the Bank of England was made independent of the Treasury as of June 1, 1998, and given the sole responsibility for determining interest rates. The Treasury has adopted a new code of Fiscal Responsibility to keep the lid on public spending and has made the budget process more transparent. The service sector now accounts for approximately 70% of the UK's GDP. Banking, insurance and financial services are particularly strong. In manufacturing, productivity has increased at a rapid rate since the early 1980s, largely due to the innovative technologies and a supportive tax regime. The UK government's commitment to free markets continues to create opportunities for competitive U.S. firms. Increasingly, public sector procurement policies emphasize "best value for money," regardless of national origin, and "outsourcing" of public services is encouraged as a means of improving quality while containing cost. Major domestic developments, notably recent legislation on pollution control, state-owned industry privatization, health care reform and private-public partnerships, have created additional commercial opportunities for U.S. exporters and investors in telecommunications, utilities, health care, environment, and air, land and rail transportation. Britain's telecommunications sector is the most liberal in Europe, presenting significant opportunities for both equipment manufacturers and service providers. The UK health care market, especially as the state-funded National Health Service (NHS) restructures, presents opportunities for U.S. suppliers of equipment and services, particularly where they can demonstrate cost savings. Growing public awareness of the consequences of environmental pollution has prompted higher EU and national environmental standards, and more rigorous enforcement of existing regulations. Availability of U.S. environmental technology has placed our environmental firms at a distinct competitive advantage. Government's Role in the Economy Market forces largely shape the economy, with regulatory bodies providing additional direction in those sectors where the private citizen is the principal user of the product or service. Both statutory and voluntary regulatory bodies monitor industries that include the privatized utilities: telecommunications, electricity, water and natural gas supply, and transportation, banking, insurance, and pensions. Britain's Labour Government inherited a legacy of major initiatives including privatization, deregulation, and support for competition. These initiatives have been continued, with the only evidence of the Labour Party's traditional interventionism in industry being evident in supporting coal versus gas for electricity generation. The only policy reversals have been the adoption of the EU's "Social Chapter," and the establishment of a national minimum wage. As a further demonstration of its commitment to economic non-intervention, the UK Treasury no longer participates with the Bank of England in the process of setting the prime bank interest rate. Further, the Chancellor of the Exchequer has committed to reducing public debt as a percentage of GDP and obtaining a budget surplus in the next three fiscal years. Infrastructure Private sector production, transport, warehousing, communications, and distribution facilities in the UK are adequate, though many of the physical assets employed show signs of prolonged underinvestment. Responsibility for the public sector infrastructure of the UK has been transferred to the extent possible to the private sector, to public-private partnerships, and to independent executive agencies that are accountable to government departments. The previous Conservative Government reduced investment in public sector facilities that are not self-financing through the receipt of user fees, or which cannot repay the capital cost within the financial year. The investment shortfall adversely affected the fabric of the country, including roads, housing, schools, hospitals, public buildings and services. Conservative Party policy has been continued by the new Labour Government, and the resulting economic climate rewards private sector investors who are able to create viable business entities from public assets at minimal cost to the government. A second wave of IT-related investment and upgrade is expected post-2000, as companies modify for the Euro, the European common currency. Few Euro-compliant products are available as yet because the rules under which businesses will have to operate are not yet clarified. Services, worth approximately $875 billion, account for 70% of Britain's annual GDP. Majority-owned affiliates of U.S. firms established in Britain account for close to 15% of this total. Those U.S.-owned firms are engaged in a broad range of industries including transportation, telecommunications, professional and technical services, finance, and insurance. Transportation, telecommunications, finance, and insurance are the best-known sectors, dominated by big business and established companies. Unlike manufacturing industry, these important sectors and the leading companies within them have proved to be flexible and innovative, responding quickly to market conditions and regulatory change, but tending to exclude small and medium-sized firms. The professional and technical services sectors are more receptive to U.S. direct exporters and to newer market entrants. The most productive of those sectors are architecture and design, advertising and publicity, management consulting, research and development, and international legal and accounting services. Without undue effort, U.S. professional services companies generate annual fees in excess of $12.5 billion from the UK. With a better understanding of the market conditions, means of access, and potential for exports, U.S. firms should achieve a significant increase in their market share. http://usembassy.org.uk/ukfcs.html for list of market research titles. INVESTMENT CLIMATE Openness to foreign investment The UK Government welcomes foreign inward investment. Foreign-owned companies are treated no differently than UK companies, and the UK does not discriminate between nationals and foreign individuals in the formation and operation of private companies. U.S. companies establishing British subsidiaries encounter no special national requirements on directors and shareholders, though at least one director of any company registered in the UK must be ordinarily resident in the UK. Market entry for U.S. firms is greatly facilitated by a common language, legal heritage and similar business institutions and practices. Major taxation issues affecting U.S. business Local and foreign-owned companies are taxed alike. Inward investors have access to certain grants and incentives, but no tax concessions are granted. The UK corporate tax rates are the standard rate of 31 percent, and a smaller companies rate (for those firms with a turnover of less than BPS. 300,000) of 21 percent. A change in the basis of corporate tax calculation will be implemented in April 1999. Currently, tax is paid in arrears, based on the actual profit or loss. In future, tax will be collected quarterly in advance, based on the company's predicted profit or loss. This scheme is termed Advance Corporation Tax (ACT). For individuals, a series of tax treaties protects foreign nationals against double taxation. The UK has a simple system of personal income tax, and one of the lowest top rates (40 percent on incomes in excess of 23,700 pounds sterling) of any EU country. Performance requirements/incentives Since business contracts are legally enforceable in the UK, there is generally no need for performance bonds or guarantees in British commerce, nor is any technology transfer, joint ventures or local management participation or control requirement imposed on suppliers. Government and industry encourage prompt payment, but there is no tradition of providing an additional discount for early settlement of accounts. Transparency of the regulatory system The government's intent is to introduce more business competition and to reduce the administrative burden on companies by reducing unnecessary red tape. This gives statutory authority over prices and competition in the regulated industries to independent regulators. These include the Office of Electricity Regulation (OFFER), the Office of Telecommunications (OFTEL), the Office of Water Regulation (OFWAT), the Office of Gas Regulation (OFGAS), the Office of Fair Trading (OFT), and Office of Passenger Rail Fare Regulation (OPRAF). The regulatory system relating to banking and finance has just started a two-year transition, after which the new Financial Services Authority will undertake the duties of a number of securities and investment management regulatory organizations. Labor Of the 28 million workforce, 26 million are in full-time employment. Only a small percentage of workers in low paid occupations work while drawing unemployment benefit, and the black economy in Britain is small. Unionization of the workforce in Britain is prohibited only in the armed forces, public sector security services and police force. Manufacturing, transport and distributive trades are highly unionized, but militant unionism is no longer common, due to the fragmentation of once-national industries. The Labour Government requires employers to recognize unions where at least half of the workforce belongs to a trade union, and the 1990 Employment Act makes unions responsible for members' industrial actions, including unofficial strikes, unless union officials repudiate the action in writing. Unofficial strikers can be legally dismissed, and voluntary work stoppage is considered a breach of contract. Women now form almost one third of the workforce, increasingly in managerial positions. Children under the age of 16 may work in an industrial enterprise only as part of an educational course. Local education authorities can limit employment of children under 16 years old if working will interfere with a child's education. A statutory national minimum wage of 3.60 pounds/hour for most workers (3.00 pounds for 18-21 year-olds) will go into effect from April 1, 1999. A persistent characteristic of the British workforce is its lack of mobility, between trades and geographically. Successive governments have introduced retraining schemes and grants with some success in creating a workforce adapted to the changing pattern of demand. Nothing so far has had any real effect on the workers' general disinclination to move from areas of high unemployment to areas that are attracting inward investment. Efficiency of the capital markets and portfolio investments Government policies are intended to facilitate the free flow of financial resources and to support the flow of resources in the product and factor markets. The City of London houses one of the largest and most comprehensive financial centers in the world. Foreign investors are able to obtain credit in the local market at normal market terms, and a wide range of credit instruments is available. The principles involved in legal, regulatory and accounting systems are transparent. They are also consistent with such international standards as exist and with the nature of the markets. In all cases, regulations have been published and are applied on a non-discriminatory basis. Dispute settlement, including enforcement of foreign arbitral awards Disputes over property, contracts, and share holdings are resolved through litigation in the High Court. The Stock Exchange Panel on Takeovers and Mergers mediates takeover bid disputes, and there is a further right of appeal to the Stock Exchange Appeals Committee. As a member of the International Center for Settlement of Investment Disputes, the UK accepts binding international arbitration between foreign investors and the state. As a signatory to the 1958 New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, the UK permits local enforcement of arbitration judgements decided in other signatory countries. Facts & Statistics on UK Background: Britain, the dominant industrial and maritime power of the nineteenth century, played a leading role in developing parliamentary democracy and in advancing literature and science. The British Empire covered approximately one-fourth of the earth's surface at its zenith. In the first half of the twentieth century its strength was seriously depleted by two world wars. Since the end of World War II, the British Empire has been dismantled, and Britain has rebuilt itself into a prosperous, modern European nation with significant international political, cultural, and economic influence. As the twentieth century draws to a close, Britain is debating the degree of its integration with continental Europe. While a member of the EU, for the time being it is staying out of the Euro system introduced in January 1999. Constitutional reform, including the House of Lords and the devolution of power to Scotland, Wales, and Northern Ireland, is an ongoing issue in Great Britain. Geography
People
Government Government type: constitutional monarchy. Capital: London Administrative divisions: 47 counties, 7 metropolitan counties, 26 districts, 9 regions, and 3 island areas: England - 39 counties, 7 metropolitan counties*; Avon, Bedford, Berkshire, Buckingham, Cambridge, Cheshire, Cleveland, Cornwall, Cumbria, Derby, Devon, Dorset, Durham, East Sussex, Essex, Gloucester, Greater London*, Greater Manchester*, Hampshire, Hereford and Worcester, Hertford, Humberside, Isle of Wight, Kent, Lancashire, Leicester, Lincoln, Merseyside*, Norfolk, Northampton, Northumberland, North Yorkshire, Nottingham, Oxford, Shropshire, Somerset, South Yorkshire*, Stafford, Suffolk, Surrey, Tyne and Wear*, Warwick, West Midlands*, West Sussex, West Yorkshire*, Wiltshire. Northern Ireland - 26 districts; Antrim, Ards, Armagh, Ballymena, Ballymoney, Banbridge, Belfast, Carrickfergus, Castlereagh, Coleraine, Cookstown, Craigavon, Down, Dungannon, Fermanagh, Larne, Limavady, Lisburn, Londonderry, Magherafelt, Moyle, Newry and Mourne, Newtownabbey, North Down, Omagh, Strabane. Scotland - 9 regions, 3 islands areas*; Borders, Central, Dumfries and Galloway, Fife, Grampian, Highland, Lothian, Orkney*, Shetland*, Strathclyde, Tayside, Western Isles*. Wales - 8 counties; Clwyd, Dyfed, Gwent, Gwynedd, Mid Glamorgan, Powys, South Glamorgan, West Glamorgan. *Note: England may now have 35 counties and Wales 9 counties. National holiday: Celebration of the Birthday of the Queen (second Saturday in June). Constitution: unwritten; partly statutes, partly common law and practice. Legal system: common law tradition with early Roman and modern continental influences; no judicial review of Acts of Parliament; accepts compulsory ICJ jurisdiction, with reservations; British courts and legislation are increasingly subject to review by European Union courts. Suffrage: 18 years of age; universal Executive branch: Chief of State: Queen ELIZABETH II (since 6 February 1952); Head of Government: Prime Minister: Anthony C. L. (Tony) BLAIR (since 2 May 1997); Cabinet: Cabinet of Ministers appointed by the prime minister; Elections: none; the monarch is hereditary; the prime minister is the leader of the majority party in the House of Commons (assuming there is no majority party, a prime minister would have a majority coalition or at least a coalition that was not rejected by the majority). Legislative branch: bicameral Parliament consists of House of Lords (1,200 seats; four-fifths of the members are hereditary peers, two archbishops, 24 other senior bishops, serving and retired Lords of Appeal in Ordinary, other life peers, Scottish peers) and House of Commons (659 seats; members are elected by popular vote to serve five-year terms unless the House is dissolved earlier); Elections: House of Lords-no elections; House of Commons-last held 1 May 1997 (next to be held by NA May 2002). Judicial branch: House of Lords, the monarch appoints, for life, several Lords of Appeal in Ordinary. Political parties and leaders: Conservative and Unionist Party [William HAGUE]; Labor Party [Anthony (Tony) Blair]; Liberal Democrats [Jeremy (Paddy) ASHDOWN]; Scottish National Party [Alex SALMOND]; Welsh National Party (Plaid Cymru) [Dafydd Iwan WIGLEY]; Ulster Unionist Party (Northern Ireland) [David TRIMBLE]; Democratic Unionist Party (Northern Ireland) [Rev. Ian PAISLEY]; Social Democratic and Labor Party or SDLP (Northern Ireland) [John HUME]; Sinn Fein (Northern Ireland) [Gerry ADAMS]; Alliance Party (Northern Ireland) [Seamus CLOSE]. Political pressure groups and leaders: Trades Union Congress; Confederation of British Industry; National Farmers' Union; Campaign for Nuclear Disarmament. International organization participation: AfDB, AsDB, Australia Group, BIS, C, CCC, CDB (non-regional), CE, CERN, CP, EAPC, EBRD, ECA (associate), ECE, ECLAC, EIB, ESA, ESCAP, EU, FAO, G- 5, G- 7, G-10, IADB, IAEA, IBRD, ICAO, ICC, ICFTU, ICRM, IDA, IEA, IFAD, IFC, IFRCS, IHO, ILO, IMF, IMO, Inmarsat, Intelsat, Interpol, IOC, IOM (observer), ISO, ITU, MTCR, NATO, NEA, NSG, OAS (observer), OECD, OPCW, OSCE, PCA, UN, UN Security Council, UNCTAD, UNESCO, UNFICYP, UNHCR, UNIDO, UNIKOM, UNMIBH, UNOMIG, UNOMSIL, UNRWA, UNU, UPU, WCL, WEU, WHO, WIPO, WMO, WTrO, ZC. Economy Economy-overview: The UK is one of the world's great trading powers and financial centers, and its essentially capitalistic economy ranks among the four largest in Western Europe. Over the past two decades the government has greatly reduced public ownership and contained the growth of social welfare programs. Agriculture is intensive, highly mechanized, and efficient by European standards, producing about 60% of food needs with only 1% of the labor force. The UK has large coal, natural gas, and oil reserves; primary energy production accounts for 10% of GDP, one of the highest shares of any industrial nation. Services, particularly banking, insurance, and business services, account by far for the largest proportion of GDP while industry continues to decline in importance, now employing only 18% of the work force. Economic growth is slowing, and Britain may experience a short recession in 1999. As a result, unemployment probably will begin to rise again. The BLAIR government has put off the question of participation in the Euro system until after the next election, not expected until 2001, but Chancellor of the Exchequer BROWN is committed to preparing the British economy for eventual membership. GDP: purchasing power parity-$1.252 trillion (1998 est.). GDP-real growth rate: 2.6% (1998 est.). GDP-per capita: purchasing power parity-$21,200 (1998 est.). GDP-composition by sector: agriculture: 1.5%; industry: 31.5%; services: 67% (1997). Population below poverty line: 17% Household income or consumption by percentage share: lowest 10%: 2.4%; highest 10%: 24.7% (1986). Inflation rate (consumer prices): 2.7% (1998). Labor force: 28.8 million (1998). Labor force-by occupation: services 68.9%, manufacturing and construction 17.5%, government 11.3%, energy 1.2%, agriculture 1.1% (1996). Unemployment rate: 7.5% (1998 est.). Budget: revenues: $487.7 billion; expenditures: $492.6 billion, including capital expenditures of $23.1 billion (1997 est.). Industries: production machinery including machine tools, electric power equipment, automation equipment, railroad equipment, shipbuilding, aircraft, motor vehicles and parts, electronics and communications equipment, metals, chemicals, coal, petroleum, paper and paper products, food processing, textiles, clothing, and other consumer goods. Industrial production growth rate: 0.5% (1998 est.). Agriculture-products: cereals, oilseed, potatoes, vegetables; cattle, sheep, poultry; fish. Exports: $271 billion (f.o.b., 1998). Exports-commodities: manufactured goods, fuels, chemicals; food, beverages, tobacco Exports-partners: EU countries 56% (Germany 12%, France 10%, Netherlands 8%), US 12% (1997). Imports: $304 billion (f.o.b., 1998). Imports-commodities: manufactured goods, machinery, fuels, foodstuffs. Imports-partners: EU countries 53% (Germany 14%, France 10%, Netherlands 7%, Ireland 5%), US 13% (1997). Economic aid-donor: ODA, $3.4 billion (1996) Currency: 1 British pound (£) = 100 pence. Exchange rates: British pounds (£) per US$1-0.6057 (January 1999), 0.6037 (1998), 0.6106 (1997), 0.6403 (1996), 0.6335 (1995), 0.6529 (1994). Communications Telephones: 29.5 million (1987 est.)
Transportation Railways: 16,878 km. Highways: 372,000 km (including 3,270 km of expressways). Waterways: 3,200 km. Pipelines: crude oil (almost all insignificant) 933 km; petroleum products 2,993 km; natural gas 12,800 km. Ports and harbors: Aberdeen, Belfast, Bristol, Cardiff, Dover, Falmouth, Felixstowe, Glasgow, Grangemouth, Hull, Leith, Liverpool, London, Manchester, Peterhead, Plymouth, Scapa Flow, Sullom Voe, Tees, Tyne. Merchant marine: Total: 155 ships (1,000 GRT or over) totaling 2,460,361 GRT/2,517,875 DWT ships by type: bulk 3, cargo 29, chemical tanker 6, combination ore/oil 1, container 25, liquefied gas tanker 1, oil tanker 51, passenger 8, passenger-cargo 1, roll-on/roll-off cargo 17, short-sea passenger 12, specialized tanker 1 (1998 est.). Airports: 497 (1998 est.). Airports-with paved runways: 356. Heliports: 12 (1998 est.). Transnational Issues Disputes-international: Northern Ireland issue with Ireland (historic peace agreement signed 10 April 1998); Gibraltar issue with Spain; Argentina claims Falkland Islands (Islas Malvinas); Argentina claims South Georgia and the South Sandwich Islands; Mauritius claims island of Diego Garcia in British Indian Ocean Territory; Rockall continental shelf dispute involving Denmark, Iceland, and Ireland (Ireland and the UK have signed a boundary agreement in the Rockall area); territorial claim in Antarctica (British Antarctic Territory); Seychelles claims Chagos Archipelago in British Indian Ocean Territory. SIGNIFICANT INVESTMENT OPPORTUNITIES The privatization of state-owned utilities is largely complete, and the few remaining government-owned enterprises or remaining HMG shares in other enterprises are also to be sold off to the private sector. The Treasury has announced that HMG would sell off its majority stakes in the National Air Traffic Service (NATS) and the Commonwealth Development Corporation. Also identified for future sale are HMG's remaining interest in British Energy, the radio spectrum for a new generation of mobile phones, Belfast Port, horseracing's betting organization (The Tote) and the Royal Mint. Additional investment opportunities result from the UK government's Private Finance Initiative (PFI) and Public Private Partnership (PPP) programs. Successful PFI and PPP schemes already exist in health care, prisons, defense logistics and training, postal services and in air traffic control. Local and foreign-owned companies are expected to bid for long-term franchises to run and improve existing public sector services in other sectors including road traffic management, production of coins and currency, port operations, air and water monitoring and cleanup, land use planning, and building control. Successful PFI bids have been mounted by consortia, involving technical, financial, and managerial partners. Each Ministry has a PFI Unit, which advises both the government and potential investors on the practicality of applicable PFI and PPP schemes. Recommended Business Opportunities The telecommunications business climate in the UK is already highly competitive in virtually every area, much like in the US. However, this does not mean there are no opportunities. We see three distinct approaches for successful market entry: head-to-head competition, acquisition of an ongoing company, and joint ventures. Under each of the three major areas of business opportunities, some current examples are referenced. An outstanding source of UK and EU telecommunications business news is Total Telecom. References in this section are from Total Telecom. While subscriptions are free, you will be required to register to read the articles. http://www.totaltele.com I. On head-to-head competition, you must have the "Killer Application, product or service" in order to effectively gain a share of the market. Citizens of the UK are smart and savvy consumers. You will likely have to make a significant market penetration in order to generate sufficient revenue to offset your start-up cost. Service will be paramount to your efforts at sustaining a profitable venture. The Top 100 - Upwardly mobile. 15 November 1999 Despite the best efforts of many incumbent service providers and equipment vendors to 'get with it' on new technologies and services, the CWI Top 100 shows a share market valuing youth, vigor, and mobility over age and experience. http://www.totaltele.com/view.asp?ArticleID=24597&pub=CWI Access - it's all the rage. 01 November 1999 Walking the floor at Geneva Telecom this year meant straining your neck to see the top of the stands and discovering that every company was now an IP concern. But most noticeable for Peter Kruger was the ubiquity of DSL. http://www.totaltele.com/view.asp?ArticleID=24647&pub=ci Paging's prognosis. 01 November 1999 There can be no doubt that paging is sick and needs treatment if it is ever to have a meaningful market. But, as Jeremy Scott-Joynt points out, reports of its death have been greatly exaggerated. Jack McDonnell, EMEA manager of messaging solutions at Motorola, the biggest paging proponent, sees opportunities where others see threats. "When you really look at what people are doing with cellphones, it's the growth in messaging that's mindboggling," he says. "So while paging may be out of the limelight, if you regard paging and messaging as an application - and after all, users don't think in terms of technology, they just want to know how they can benefit - then messaging is actually coming into its own." "Paging has this knack of reinventing itself," he says. "And there's life in paging networks yet." http://www.totaltele.com/view.asp?ArticleID=24651&pub=ci Spin Doctors Help Massage the Operators' Pains Away The word is that the UK operator BT Cellnet was recently forced to put a stop on all its mobile service calls between the UK and India and Pakistan. Apparently traffic was totally barred on 27 September and the "temporary" prohibition remained in force for six days thereafter. http://www.totaltele.com/view.asp?ArticleID=24638&pub=ci II. Acquisitions are a second way to approach the UK market. Most attractive are businesses in the $1 to $15 million dollar gross revenue range that could benefit from the efficiencies that a large, well capitalized parent company could make. In a market like the UK's, wireless, local-loop and cellular companies are all eligible. U.S. - Europe digital cellular roaming set for next year as industry unites. 15 November 1999 GSM and U.S. TDMA users could roam onto each others' networks from late next year if a venture hatched by their respective lobby groups goes according to plan. The two groups - the GSM Association and the Universal Wireless Communications Consortium (UWCC) - have agreed to collaborate to allow their services to work transparently on either standard by making their respective core networks interoperate, and to encourage dual-standard handset development. http://www.totaltele.com/view.asp?ArticleID=24599&pub=CWI III. Joint Ventures are the third way to enter the UK market. More importantly, they provide a way to penetrate the European Union after building a strong record of success in the UK. Opportunities exist for teaming with large U.S. firms in going after next generation products. Lucent and One.Tel Team for 3G Assault. 23 November 1999 Australian phone company One.Tel and Lucent announced today that they are teaming up to bid for Third Generation licences in the U.K. and western Europe. Under a memorandum of understanding, Lucent will build, operating and maintain 3G mobile networks on behalf of One.Tel. http://www.totaltele.com/view.asp?ArticleID=24742&pub=tt&categoryid=0 EC steps up pressure for unbundling. 15 November 1999 The European Commission is preparing to name countries with the highest local call rates across the European Union, in an effort to shame governments into allowing competition. The figures will be published early in the new year. Results of the Commission's similar review of leased-line costs will be published before the end of this year. http://www.totaltele.com/view.asp?ArticleID=24598&pub=CWI Trade Barriers The UK has no significant trade or investment barriers, or restrictions on the transfer of capital. Those barriers that do exist are the result of UK implementation of EU Directives and regulations, rather than the intended result of actions of the UK government. An EU common external tariff applies to all non-EU imports and a valued-added tax (VAT) of 17.5% applies to most transactions including imports. The applicable rates of import duty can be obtained from U.S. Department of Commerce Export Assistance Centers, and copies of the tariff can be obtained from H.M. Stationery Office, Atlantic House, Holborn Viaduct, London EC1P 1BN. VAT on business expenses paid by non-EU participants at trade fairs, exhibitions and conferences can be recovered by the foreign firm's local agent or accountant. Use of agents and distributors; finding a partner National laws governing the relationships between agents and distributors and their suppliers are broadly harmonized throughout the EU. EU Directives establish the rights and obligations of the principal and agent, the agent's entitlement to remuneration, and the conclusion and termination clauses of agency contracts. The law appears to protect the interests of the agent rather than the principal to such an extent that most agency arrangements within the EU have been terminated in favor of distributorships. The U.S. Department of Commerce has a range of services that are designed to help U.S. firms identify prospective distributors or sales and service representatives. The most popular and effective of these programs are the fee-based Agent/Distributor Service (ADS) and the Gold Key Program. American companies initiate the ADS at their Export Assistance Center in the U.S.; the Gold Key may be commissioned directly with the Commercial Service post. ADS applicants specify the profile of their ideal prospective representative, and the Commercial Service searches for appropriate local companies that have a specific interest in representing them. The Gold Key service schedules face-to-face meetings with business prospects, either as a follow-on to a successfully completed ADS, or as a separately organized program of meetings with prospective representatives, end-users or joint-venture partners. The achievement of mutually agreed objectives has consistently proved the value of the ADS and Gold Key programs as export promotion tools. Direct marketing Affordable transatlantic telecommunications, low cost bulk mailing rates, and the use of credit cards for international transactions have made direct marketing from the United States possible. Public confidence in the accuracy of remote billing, data security, and certainty of delivery is increasing at a time when the Internet is also becoming an accepted marketing tool. These factors combine to make direct marketing of many types of goods and services worth considering. The British Code of Advertising Practice (CAP) has established guidelines for direct mail advertising and for list and database management. The code and the supplementary rules can be obtained from the Advertising Standards Authority at Brook House, Torrington Place, London WC1E 7HN; telephone: (44) 171 580-5555; fax: (44) 171 631-3051. Joint-ventures/Licensing Joint ventures and licensing are often used to maintain a competitive advantage in the British market. These arrangements generally benefit the local economy by employing production facilities and labor, may be eligible for UK investment grants and financial assistance, and will provide for relief from import duties. Steps to establishing an office Establishing a branch office is an inexpensive and simple procedure, involving the notification of the parent company's registration details to the Department of Trade and Industry's Registrar of Companies. There is no need to wait until the registration is completed before commencing operations, as the branch office of a foreign parent has a one-month grace period before the deadline for registration. Setting up a subsidiary company is equally straightforward, though using a local accountant or law firm for filing purposes may make the task even easier. Inexpensive ready-made (pre-registered) companies can be purchased from company formation agents, allowing market entrants to start trading with limited liability immediately. Selling factors/techniques Both EU and national legislation govern agreements such as exclusive agency and supply arrangements, exclusive purchasing contracts, restrictive terms, and other related matters. U.S. manufacturers and exporters are able to appoint exclusive agents and to determine the method of distribution. However, they may not seek to prevent the import or sale of competitive goods from other sources, including parallel (grey) imports from dealers and distributors in other countries. Practices of concern to the EU Competition Directorate and to the UK regulatory authorities are those measures that distort trade to the benefit of the suppliers and to the detriment of competitors or end-users of the product of service. The most recent legislation, introduced in July 1998, gives some exemptions of vertical agreements between manufacturers and their resellers, requires disclosure of certain types of inter-company commercial arrangements, and gives sweeping powers of investigation and enforcement to the regulatory authorities. A prominent London law firm summed up the changes, stating that from having one of the laxest competition regimes in the world, Britain now has one of the toughest. Advertising and trade promotion Trade promotion materials used in the U.S. market may need to be modified for local legal, cultural, and other differences. Local advertising agencies and marketing consultants can provide appropriate advice. Also, the Advertising Standards Authority oversees the practices of the advertising industry and enforces the provisions of the British Code of Advertising Practice (CAP). Advertisers should become familiar with the CAP recommendations. Pricing products The UK is a highly competitive and highly receptive market for U.S. goods and services. When pricing products for sale in the UK, U.S. exporters should be aware of the additional costs that could otherwise undermine profit margins. In addition to customs duty on imported goods, a value-added tax of 17.5% is charged on the majority of goods sold in the UK. The cost of freight, insurance and customs clearance will further diminish margins, as will commission payments to agents and distributors. Because the UK market is smaller and does not benefit from the same degree of economies of scale, local retailers have tended to seek a higher profit margin than is customary in the United States. Countering this tendency toward higher prices, the availability of similar goods throughout the European Single Market introduces competitive pressure to keep prices down. Sales service/customer support Having an advanced economy, the UK offers a full range of sales and customer support services independent of those of the original equipment manufacturers. Advice on accessing these may be obtained from the Commercial Service at the American Embassy. Selling to the government Most UK government departments are subject to the GATT Government Procurement Code, which requires that qualified foreign bidders be given equal access to public sector contracts. Urgency or national security reasons can be used to justify procurements outside GATT rules. As there is no widely available UK government journal, procurement intentions are published in the EU Official Journal and in specialized industry-specific publications. The Ministry of Defence (MoD) publishes information on its future projects and procurements in a biweekly Contracts Bulletin, which is available to U.S. subscribers. Though useful, most U.S. defense companies require more lead-time than the bulletin provides, and need detailed guidance on the complex rules and bid evaluation criteria used in this sector. To remedy this, the Embassy's Office of Defense Cooperation (ODC) has prepared a handbook, now in its third edition, of unique insights and case studies in UK defense marketing for U.S. companies. The handbook is a briefing tool that supplements the practical advice that can be obtained directly from the ODC in London. This advice includes insight, guidance, status and advocacy to support the U.S. Government, the British Government and U.S. defense contractors for acquisition and cooperative development programs for defense equipment and services, including missiles and defense systems, munitions, sensors, ships, aircraft and helicopters. Larger defense contracts let to non-EU contractors require the negotiation of industrial participation (IP/offset) arrangements. The IP arrangements are separate from the procurement contracts, but supervised by the MoD's Defense Export Services Organization (DESO). Contact data for MoD and the ODC is given in Chapter XI, Appendix E. of this Guide. SOURCES OF ADDITIONAL INFORMATION ON THE UK U.S. Embassy http://www.state.gov/www/about_state/business/com_guides/1999/europe/uk99.html. Travel Advisory - Consular Information Sheet Advisories usually include suggested travel precautions (including identification of any especially dangerous areas) as well as information on such legal matters as visas, customs regulations, drug laws, gun laws, dual citizenship, location of the U.S. embassy and consulates, and location in the U.S. of the nation's embassy. http://travel.state.gov/uk.html World Factbook Entry from the annual book edited by the U.S. Central Intelligence Agency which uses information from several U.S. government agencies, including the Department of State and Department of Commerce, to provide texts, maps and statistics similar to those of world almanacs. http://www.odci.gov/cia/publications/factbook/uk.html United Kingdom - Open Government Web Server Offers access to servers from many national and local government agencies and bodies by index, organization, and search feature. Current events are highlighted at OPEN GOVERNMENT - What's New. http://www.open.gov.uk/
United Kingdom - Foreign & Commonwealth Office This Web site offers texts on the United Kingdom's foreign policy and international relations. http://www.fco.gov.uk/ Government Officials From the "Chiefs of State and Cabinet Members of Foreign Governments" published by the U.S. Central Intelligence Agency, listings include the names of the chiefs of state and cabinet officers, as well as the head of the central bank and the ambassador to the U.S. http://www.odci.gov/cia/publications/chiefs/f572.html Human Rights Report Annual report made for the U.S. Congress by the U.S. State Department concerning human rights, including specifically rights of women, children, and ethnic or religious minorities. http://www.state.gov/www/global/human_rights/1998_hrp_report/unitedki.html MAJOR PLAYERS IN UK TELECOMMUNICATIONS Department of Trade and Industry (DTI) DTI is the UK government department with the overall aim to promote enterprise, innovation and increased productivity. DTI does this by encouraging successful business start-ups, by increasing the capacity of business to grow, invest, develop skills, adopt best practice, and to exploit opportunities abroad. It also fosters the development of a knowledge economy that accommodates regional differences. While the scope of the Department is vastly broader than just telecommunications, it is an important Department for the industry and has a very informative Web Site located at: http://www.dti.gov.uk/. The DTI's responsibilities in telecommunications are handled by the "Communications and Information Industries Directorate" (CII). DTI advises companies on issues relating to obtaining telecommunications licenses and has an excellent paper on the licensing process. http://www.dti.gov.uk/telecom/tellice/guidnot.htm. DTI also regulates company matters such as competition, fair-trading, aspects of employment law and trade union affairs, which could be very important to a company, if it believes it is experiencing any type of anti-competitive practice by a telecommunications provider. The UK is part of the European Union and has complied with all European Commission (EC) telecommunications liberalization legislation which amounts to a series of EC Directives such as the EC Interconnection Directive, and the EC Licensing Directive. The first of the Directives, which was adopted by changing UK statutes and regulations, came into effect January 1, 1998. DTI monitors all EC activity relating to telecommunications, summarizes it, determines which, if any, laws and regulations will need to be changes or created to comply with the Directives. It also makes the information available to other branches of the UK government as well as the telecommunications industry through its Web Site. The DTI has extensive information on the EC Directives and what the EC is currently doing in relation to the telecommunications industry located at: http://www.dti.gov.uk/telecom/. Additionally, the DTI makes information on a wide range of issues relating to the European Union. http://www.dti.gov.uk/europe/index.htm. SPEARHEAD is DTI's computerized database offering vital information on the single European market and related legislation. DTI also maintains an UK Contact List of the people you can speak to across Government about Single Market Legislation. The European Union Small and Medium Sized Enterprise Initiative aims to provide smaller firms in parts of England with grants and advice to encourage them to adapt to the Single Market and to become more internationally competitive. DTI maintains extensive information for small to medium businesses with an aim to helping them become more competitive. DTI's Web Site is really one place that any new business should plan on spending a significant amount of time on just to learn what is available to them. One program of the DTI that a new telecommunications company should be aware of is LINK. LINK is the UK Government's principal mechanism for supporting collaborative research partnership between UK industry and the research base. It provides financial support to individual programs of research. LINK aims to enhance the competitiveness of UK industry and the quality of people's lives, through support for managed programs of pre-competitive science and technology in market or technology sectors, and by encouraging industry to invest in further work leading to commercially successful products, processes, systems and Services. Various government departments and Research Councils currently sponsor LINK programs covering a wide range of technology, from food and biosciences to electronics and communication. http://www.dti.gov.uk/support/link.htm. SMART is the DTI's package of support, which provides grants to help individuals, and small and medium-sized businesses review their use of technology, access technology and research and develop technologically innovative products and processes. Office of Telecommunications (OFTEL) OFTEL is the regulator for the UK telecommunications industry. OFTEL was set up under the Telecommunications Act 1984. The main way OFTEL regulates is through monitoring and enforcing the conditions in all telecommunications licenses in the UK. OFTEL also initiates modifications to these license conditions. Its extensive and informative Web Site is located at: http://www.oftel.gov.uk/. All telecommunications operators - such as BT, Mercury, and local cable companies, mobile network operators and the increasing number of new operators - must have an operating license. These set out what the operators can - or must - do or not do. For example, BT's license contains the formula (currently RPI - 7.5%) which controls the prices of its main network services; and the licenses of local cable companies contain milestones (in terms of premises passed by particular dates) they must reach in building their networks. Users of the services supplied by the operators also need a license. In nearly all cases they are covered by a class license - a license issued to a group, not an individual, allowing certain activities. For example, the Self-Provision License (SPL) enables customers to use telephones in their homes. OFTEL is also responsible for monitoring and enforcing class licenses. Under the Telecommunications Act 1984, OFTEL has a number of functions. Briefly these are:
Types of Licenses in the UK 1. Public telecom operators 1.1 Non-public telecommunications operators powers license 2. Broadcasting operators 3. Class Licenses 4. Cable licenses 4.1 Cable class licenses 4.2 Broadband cable licenses 4.3 Broadband interconnect licenses 4.4 Satellite Master Antenna Television licenses (SMATV) 5. Earth orbiting apparatus 5.1 E.O.A. class licenses 5.2 Downlink licenses 5.3 Satellite Services licenses 5.4 Up/down link 5.5 Uplink licenses 6. Mobile communications licenses 6.1 Cellular licenses 6.2 Closed user groups 6.3 Mobile data licenses 6.4 PCN licenses 6.5 PMR & PAMR licenses 6.6 Radio paging 6.7 Telepoint 6.8 Miscellaneous 7. Particular person 7.1 General 7.2 International Simple Resale 7.3 International Simple Voice Resale 7.4 Emergency alarm 7.5 Personal numbering 7.6 International facilities licenses with code powers 7.7 International facilities licenses without code powers OFTEL Research & Intelligence Unit is the contact point for the sale of licenses and publications which have to be purchased, distribution of free publications and public register inquiries. The public register contains all telecommunications licenses, any amendments to licenses issued under the 1984 Telecommunications Act and a complete public record of all consultation responses received by OFTEL. The Research & Intelligence Unit's Web Site address is: http://www.oftel.gov.uk/oftlic_c.htm. A Paper with some good info: Towards better telecommunications for customers A review of progress in the UK June 1997 http://www.oftel.gov.uk/consumer/towards.htm The Radio Communications Agency The Radio Communications Agency is an Executive Agency of the DTI (Department of Trade and Industry). It is responsible for the allocation, maintenance and supervision of the UK Radio Spectrum. http://www.radio.gov.uk/ra_wel.htm. The Agency has a very informative Web Site, which has information on a wide range of topics including: Amateur Radio Annual Report and Business Review Broadcasting and Associated Services Citizen's Band Fixed Links Land Mobile Radio License Changes Low Power Marine Miscellaneous Information Sheets and Application Forms MPT Specifications and Codes of Practice Paging Private Mobile Radio Public Mobile Communications Radio Frequency Allocations Radio Local Area Networks Radio Quality Assurance Scheme Satellite Services Spectrum Management Spectrum Pricing & its Policy Television and Radio Reception Type Approval and Electromagnetic Compatibility The Radio Authority The Radio Authority licenses and regulates all commercial radio services. These comprise national, local, cable, national FM subcarrier, satellite and restricted services. The latter includes all short-term, freely radiating services (for example, 'special event' radio) and highly localized permanent services such as hospital and student radio. The Authority will also be licensing digital radio services, both national and local, over the next few years. The Authority is responsible for monitoring the obligations on its licensees required by the Broadcasting Acts 1990 and 1996. The Authority has three main tasks: to plan frequencies; to appoint licensees with a view to broadening listener choice; and to regulate programming and advertising. It is required, after consultation, to publish Codes to which licensees must adhere. These cover programs, advertising and sponsorship and engineering. There are also rules on ownership. The Authority can apply sanctions to licensees who break the rules. Sanctions include broadcast apologies and/or corrections, fines and the shortening or revocation of licenses. The Radio Authority's Web Site contains detailed information on everything the Authority does, all the way down to the application forms for a license. http://www.radioauthority.org.uk/index.html National Radiological Protection Board The National Radiological Protection Board (NRPB) was created by the Radiological Protection Act 1970. The text of the Act is available on this Web site and is published in Documents of the NRPB, Volume 1, Number 1. http://www.nrpb.org.uk/. The statutory functions of NRPB under the Act are: 1) By means of research and otherwise, to advance the acquisition of knowledge about the protection of mankind from radiation hazards. 2) To provide information and advice to persons (including Government Departments) with responsibilities in the United Kingdom in relation to the protection from radiation hazards either of the community as a whole or of particular sections of the community. If you think that the NRPB has nothing to do with telecommunications, think again. Here is a partial list of the documents available at its Web Site: Information on investigation levels for UK amateur radio. Information on cordless telephones. NRPB response to The Sun article of 24 November 1998 "Are mobiles scrambling our brains?" NRPB response to a press report concerning mobile phones and memory loss. NRPB response to national and international exposure standards for electric and magnetic fields. NRPB response to the view of an expert panel in the USA on EMF health effects. Information on the effects of magnetic fields on behavior. Background information on mobile phones. Information on an NAS report on health effects of electromagnetic fields. Information on local area electricity substations and electromagnetic fields. NRPB response to a Swedish study on mobile phones and brain cancer risk. Central Computer and Telecommunications Agency Central Computer and Telecommunications Agency (CCTA) is an agency of the UK government's Cabinet Office. CCTA's aim is to help customers to improve the delivery of their services through the best use of IT. Its primary focus is the UK public sector. http://www.ccta.gov.uk/. CCTA offers a wide variety of services in and outside the telecommunications market. To help Business Managers CCTA has written many publications including guidance on Information Systems strategy, benefits management, benchmarking and business process re-engineering. A list of CCTA's services can be found at: http://www.ccta.gov.uk/services/list/atoz.htm. In the telecommunications arena CCTA runs one of Europe's largest private telephone networks (almost 45,000 extensions). It manages the outsource contracts for the government data and telecommunications networks, as well as the Government Secure Intranet. It runs Europe's largest public sector Internet Web site a gateway to over 400 organizations which has achieved international recognition as one of the world's top sites: http://www.open.gov.uk. Specific Telecommunications Services of CCTA Metropolitan Telecommunications Services (MTS) is a one-stop shop, offering a managed voice telephone service to the public sector where customers pay a flat rate per extension used. This means there are no hidden costs, which allows customers to budget accurately. Currently the MTS provides services to departments and agencies on a national basis. Government Telecommunications Contracts Service (GTCS) core business is the provision of the telecommunications infrastructure for the public sector by way of Framework Service Agreements. We respond to our customers' requirements by defining the market for a set of services and procuring them to establish choice and value for money. Once established the Agreements are managed by and developed by change of control so as to demonstrate a pro-active approach. Government Data Network (GDN) is a nation-wide managed data and voice communications network serving government departments and agencies and provided under contract by Racal Telecom. The terms of the GDN Network Agreement guarantee high levels of performance and serviceability to GDN users. Government Telecommunications Mobile (GTM) Service has been available since May 1997, and to date 80 Authorities have signed Access Agreements. Currently there are approximately 6000+ handsets and over a thousand Pagers, either under the managed service (handset provided as part of package) or a tailor made package where the customers purchases the handset (subsidized by Cable & Wireless Communications) and chooses the tariff that best meets business needs. Government Telecommunications Contracts (GTC) Project of the CCTA has established a Framework Contract for a wide range of telematics, communication and associated information services. The GTC frameworks will help public authorities to: contract on public purchaser, not supplier, terms and conditions; obtain diversity of supply; customer choice by mini-competitions; reduce cost, complexity and time taken for acquisition; support cross organizational initiatives across departmental boundaries. Examples of service categories of framework contracts are:
RELEVANT EUROPEAN BODIES As already referenced, due to the fact that UK is part of the EU, there are regulatory bodies outside of the UK that are relevant to telecommunications in the UK. While they do not directly regulate telecommunications services in the UK, they establish many facets of the laws and regulations that control the regulatory environment of telecommunications in the UK. European Conference of Postal and Telecommunications Administrations The European Conference of Postal and Telecommunications Administrations (CEPT) was established in 1959. The original members were the incumbent monopoly-holding postal and telecommunications administrations. CEPT's activities included co-operation on commercial, operational, regulatory and technical standardization issues. In 1988 CEPT decided to create ETSI, The European Telecommunications Standards Institute, into which all its telecommunication standardization activities were transferred. In 1992 the postal and telecommunications operators created their own organizations, PostEurope and ETNO respectively. In conjunctions with the European policy of separating postal and telecommunications operations from policy-making and regulatory functions, CEPT thus became a body of policy-makers and regulators. At the same time, Central and Eastern European Countries became eligible for membership in CEPT. CEPT with its 43 members now covers almost the entire geographical area of Europe. The new CEPT, which deals exclusively with sovereign/regulatory matters, has established three committees, one on postal matters, and two on telecommunications issues: the European Radiocommuication Committee (ERC) and the European Committee for Regulatory Telecommunications Affairs (ECTRA). CEPT's Plenary Assembly decides the field of responsibility for each committee, while each committee establishes its own rules of procedure and elects its chairman. CEPT maintains a Web Site with links to Web Pages for ERC and ECTRA. http://cept.org/ European Radiocommunications Committee (ERC) The aims and functions of the ERC include but are not limited to:
European Committee for Telecommunications Regulatory Affairs (ECTRA) The aims and functions of the ECTRA include but are not limited to:
Satellites SURREY SATELLITE TECHNOLOGY, LTD (SSTL) SSTL is a leading research and development company working with the Surrey Space Centre at the University of Surrey's satellite engineering research group to provide rapid and cost-effective satellite missions. SSTL was formed in 1985 as a company wholly owned by the University of Surrey with the objective of exploiting the academic research within the University's Space Centre to develop and market cost-effective small satellites for rapid and affordable commercial access to space. Its Web Site is located at http://www.sstl.co.uk/. Over the last 20 years SSTL, in conjunction with the University of Surrey, has been responsible for 14 small satellite missions which have been launched, of which 11 missions are still operational and monitored, maintained or controlled from SSTL's mission operations and control centre in Guildford. SSTL has been responsible for many pioneering applications of small satellites and small satellite technology. In 1984 UoSAT-2 carried the first digital store and forward payload.
SURREY SPACE CENTRE Surrey Space Centre at the University of Surrey is Europe's largest organization specializing in small satellite engineering research. The Centre was opened in 1992 and is home to the University's space related research covering many aspects of satellite engineering: Power, ADCS, Satellite Communications, VLSI (OBDH), Space Sciences (Radiation), and Satellite Systems. Its Web Site is located at http://www.ee.surrey.ac.uk/SSC/. There is a Small Satellites Home Page sponsored by SSTL loaded with perhaps all the information about small satellites you will ever want, http://www.ee.surrey.ac.uk/SSC/SSHP/sshp.html. CURRENT UK TELECOMMUNICATIONS SERVICE PROVIDERS By far, the most well established telecommunications service providers in the UK are British Telecommunications (BT) and Mercury Communications Limited. Below is a listing of all current public telecommunication service providers that currently have valid licenses issued by OFTEL. The list does not include class license, broadcast licenses, or mobile class license. For a complete listing of all licenses see http://www.oftel.gov.uk/oftlic_c.htm. Public Telecommunications Operators ACC Long Distance UK Ltd Advanced Radio Telecom Ltd AT & T Communications (UK) Ltd Atlantic Telecommunications Ltd Atlantic Telecommunications Ltd Atlantic Telecommunications Ltd British Telecommunications City of London Telecommunications Ltd COLT Telecommunications Completel UK Limited Core Telecommunications Limited Dolphin Telecommunications Limited [formerly Tetralink Communications Limited] Eastern Group Telecoms Ltd Energis Communications Ltd Espirit Telecom UK Limited Faultbasic Limited General Telecommunications Ltd Highway One Corporation Ltd Interdigital Networks Limited International Computers Limited Internet Network Services Ltd Ionica L3 Ltd KDD Europe Ltd Kingston upon Hull City Council and Kingston Communications (Hull) PLC Kingston Communications (Hull) PLC (National other than Hull) Mercury Communications Limited Mercury Personal Communications Ltd MLL Telecom Limited MFS Communications Ltd National Transcommunications Ltd Norweb PLC Orange Personal Communications Services Ltd The Phone Company Racal Network Services Ltd Radiotel Systems Ltd Rateflame Limited Scottish Hydro-Electric PLC ScottishPower Telecommunications Ltd Sprint Holding (UK) Ltd SWEB Telecoms Ltd. Telecom Securicor Cellular Radio Ltd Tele2 (UK) Ltd. (Formerly Liberty Communications) Telewest Communications PLC Telia UK Ltd Telstra (UK) Ltd Torch Communications Ltd Videotron City and Westminster Ltd Vodafone Ltd Winstar Communications Limited Associations & Bodies FEDERATION OF COMMUNICATIONS SERVICES LIMITED Federation of Communications Services Limited (FCS) is the trade association for the mobile communications industry in the British Isles. Founded in 1981, FCS has a broad membership within the mobile and telecommunications industry including network operators, service providers, manufacturers, distributors and dealers. It provides mobile phone, paging, mobile radio & fixed telephony products and services. Its Web Site is located at http://www.fcs.org.uk/. BROADBAND WIRELESS ASSOCIATION The Broadband Wireless Association (BWA) is a European based operator, manufacturer and regulator industry group formed to promote common standards in the development of broadband services delivered by microwave radio. The members of the group attend, and are invited to speak at, the many conferences that are being held around Europe, the Far East and the Americas. Members also attend other relevant standards bodies to provide input on user requirements and technical issues. Its Web Site is located at This site will form the base for an exchange of information, views and opinions from all areas of the industry. Contributions, comments and questions will be very much welcomed for inclusion in the regular bulletins that are planned. Having secured a web address that responds to searches for Broadband Wireless, we are happy to include links to your site and short promotional messages for your products. Its Web Site is located at http://www.broadband-wireless.org/. MAGENTA SYSTEMS LTD Magenta Systems Ltd. maintains a Web Site where you can compare the residential and business telephone tariffs charged by various operators in the United Kingdom. Its Web Site is located at http://www.magsys.co.uk/telecom/. The Tariff Comparison currently comprises the following tables: Business Telephone Tariffs Residential Telephone Tariffs Special Service Telephone Codes International Telephone Codes National Telephone Codes Indirect Access Codes Forthcoming Code Changes Operators and Notes Mobile Telephone Tariffs TECHNICAL ISSUES STANDARDS EU and ISO Standards are paramount. As they are written, EU and ISO Standards supersede any applicable British Standards. Industry-specific standards and approvals are often accepted as an assurance of product quality if no relevant British standard exists. Such acceptance, though, is invalidated when a national, EU or ISO standard is adopted. The ETSI is the dominant EU standards body and was introduced herein above. Also discussed herein above were NRPB and BWA which both have a role in standard setting for the UK. In addition to the standards information referred to herein above, additional standards information can be obtained from the British Standards Institution, 389 Chiswick High Road, London W4 4AL, Tel 011-44-181-996-9000; fax 011-44-181-996-7400. Assistance in identifying applicable British standards is available from the Standards Information Service Center, Technology Building 228, Room B-166, National Institute of Standards and Technology, Gaithersburg, MD. 20234; Tel (301) 975-4037. Copies of the standards can be obtained from the American National Standards Institute (ANSI), an agent for BSI, located at 11 West 42nd Street, New York, N.Y. 10036; (212) 642-4900; fax (212) 302-1286. DTI also provides extensive information on standards (some of which relate to telecommunications), and other laws and legislation which must be met for doing business in the European Union. 
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