The Limits of Europeanization: Regulatory Reforms in the Spanish and Portuguese Telecommunications and Electricity Sectors

The creation of an EU-level regulatory regimes for telecommunications and electricity was a highly successful political initiative of the European Commission. In promoting market liberalization for telecommunications (a key sector in the creation of the information economy) and electricity (one of the sectors most resistant to change) the European Commission asserted the political importance of European project. Indeed, the two new regimes are commonly cited as successful cases of Europeanization. However, this paper argues that the causal link between European initiatives and national policy change is weak. Building on an emerging tradition of cross-sector research of these two sectors, and considering two most-similar European countries, the paper examines commonalities and variations in the regulatory reforms of telecommunications and electricity in Spain and Portugal in the last two decades. It applies a series of comparisons, including a stepwise comparative analysis of two countries (one a reluctant liberalizer, the other an enthusiastic one), of two sectors (a pace-setter and a foot-dragger) and of two time periods (before and after the regulatory reforms). We suggest that processes of Europeanization can impinge on the strategic capacities of European member states only to a limited degree. Spain and Portugal were able to shape their sectors according to the preferences of their national policy communities and in a context of a global shift in the way countries both within Europe and outside it defined their interests.