Independent regulators in Italy

As a result of the implementation of EU directives on liberalization, the evolution of the Italian energy and telecommunication industries could became a paradigm for the reform of all public utilities, in Italy, from the postal service to the railway network. This paradigm requires three changes in the government’s role and in the industry structure. First, the government will lose its exclusive right to operate in the field, a right thus far reserved to a public operator or to a government-controlled, yet formally private, operator. Second, it will no longer fulfill the convenient role of being both producer and regulator; the property of the ex-monopolist, through a huge privatization process, will come under the control of the financial market control. Third, new bodies, independent of political, economic, and bureaucratic power, will regulate the industries, guaranteeing equal access to them and imposing fair play rules in the competitive arena. This paper examines this paradigm, focusing on the new bodies as the centre of the new regulatory scheme. It begins with the description of the historical and theoretical background of the state as both producer and regulator. Then the Author traces the failure of the traditional form of state intervention and examines the independent powers’ raison d’être, giving a brief history and an analogy with North American, British and French independent bodies. The common and qualifying features of the new bodies are addressed in the following section and their all but easy compliance with principles at the core of the Italian public administration model as outlined in the Constitution. In conclusion, some insights are given on the factors that are likely to determine their impact on public utility industry.