The European Parliament,

-  having regard to the statement by the Commission,

-  having regard to Article 81 of the EC Treaty prohibiting all agreements between undertakings, decisions by associations of undertakings and concerted practices which may affect trade between Member States and which have as their object or effect the prevention, restriction or distortion of competition within the common market,

-  having regard to the Commission's June 2000 report to the Council reviewing the merger regulation,

-  having regard to the recent decisions by both the European Commission and the US Department of Justice to prohibit a merger between MCI WorldCom and Sprint,

-  having regard to its earlier resolutions on mergers, restructuring, transfer and closure of undertakings in the EU,

-  having regard to the ILO and UN codes of conduct,

A.  whereas the Treaty on European Union states in its principles that the Community's Member States should develop an economic policy conducted in accordance with the principle of an open market economy with competition and with the guarantee of growth and employment,

B.  whereas the main policy objectives to be achieved by regulation in this fast-moving sector, and the principles and design of the broad regulatory framework, have been set out in the 1999 Communications Review,

C.  whereas the European Union is currently undergoing a number of changes, the consolidation of the Internal Market accelerated by the EURO in strategic service sectors, the implementation of new technology, the financial upheaval as well as the forthcoming enlargement and strengthening of globalisation;

D.  whereas since 1990 a fivefold increase in the number of mergers has been notified under the merger regulation which increased to around 300 cases per year; whereas this represents a growth in merger activities of 33 % compared to 1998 and whereas the merger cases and control operations have become increasingly complex, including a wider geographical scope and obligatory simultaneous analysis of several different markets,

E.  whereas the future direction and pace of possible sell-offs, acquisitions, mergers, alliances and de-aggregations among companies involved in telecoms operations cannot be predicted with confidence,

F.  whereas US penetration on the European market is very high in particular concerning provision of voice telephony, joint ventures and direct holdings; whereas cooperation between competition monitoring bodies of the US and the European Community is working adequately and satisfactorily,

1.  Welcomes the decision of the European Commission and the US Department of Justice to block the merger of MCI WorldCom and Sprint because of its impact on competition in the market for top-level internet connectivity and voice telephony on the US-EU route; is of the opinion that it is a good example of working for the benefit of European consumers and against a dominant position in the telecom market;

2.  Points out that Europe needs to create the conditions for a modern economy, in particular through new information technologies, development of new services and creation of new businesses; strongly believes that in handling industrial change the EU must create sustainable economic development, universal and low-cost internet access for all people in Europe through competitiveness based on quality, initiative and innovation, and a European knowledge-based society based on equality of opportunity, life-long learning, effective social protection, adaptability and employability;

3.  Is of the opinion that effective competition on the European and global scale can only be maintained if there are reasonably comparable competitors in a market without one firm being dominant and reasonably free entry into all segments of the market is ensured;

4.  Calls on the Council and Commission to revise the EEC merger regulation and take-over bids directive in order to guarantee a simplified and consumer-friendly procedure for treatment of such concentrations bearing in mind the requirements for information and consultation of employees;

5.  Is deeply concerned about the proposed appropriations bill of the US Department of Commerce, Justice and State, which limits the transfer of licences to companies which are more than 25% owned by a foreign government and does not allow the use of the existing waivers;

6.  Is of the opinion that the proposed legislation would mean a breach of commitments made by the US under the GATS and the WTO which could set a dangerous precedent for other countries and could lead to new protectionist tendencies;

7.  Reiterates its request for further consideration to be given to the concept of competition in the telecommunications sector, and therefore welcomes the Commission's intention to carry out a more thorough inventory of the merger control system;

8.  Intends to address these complex issues further in its forthcoming consideration of the Commission's competition reports;

9.  Instructs its President to forward this resolution to the Commission, the Council, the governments and parliaments of the Member States and the Social Partners.