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1 Radio spectrum assignements for broadband services Gundega Rutka Head of Scarce Resource Division Electronic Communications and Post Department 10th.

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Presentation on theme: "1 Radio spectrum assignements for broadband services Gundega Rutka Head of Scarce Resource Division Electronic Communications and Post Department 10th."— Presentation transcript:

1 1 Radio spectrum assignements for broadband services Gundega Rutka Head of Scarce Resource Division Electronic Communications and Post Department 10th Baltic Electronic Communications and Postal Services Regulators’ Meeting 28 – 30 August 2013

2 OverviewTerms & Conditions for Participation Reserve Price Activity Rules Spectrum blocks Coverage Requirements, supervision Violation of Auction Rules and their Consequences Questions 2006 – four beauty contests for 450MHz, 900MHz, 390MHz, 40,5-43,5GHz ) 2007 – two beauty contests for 32GHz and 10.5GHz 2008 – four beauty contests for 900MHz, MHz, 450MHz, 26GHz 2009 – two beauty contests for 32GHz and 28GHz 2010 – two auctions (3.6GHz, 900MHz) two auctions (450MHz) 2012 – two auctions (2.6GHz (FDD, TDD - unsold) and 2.3GHz) 2013 – two auctions (2.6GHz (TDD), digital dividend) Totally : “Beauty contests” – 4 year experience ( 12 beauty contests) “Auctions” - 4 year expierence (6 auctions) SPRK expierence for tenders

3 OverviewTerms & Conditions for Participation Reserve Price Activity Rules Spectrum blocks Coverage Requirements, supervision Violation of Auction Rules and their Consequences Questions Auction Process Competition at the margin Multi-round process Simultaneous All licences sold in one auction Equality and transparency of process Assist price discovery after each round Open Efficiency (Auction is conducted via auction software) Competition Easy rules and understandable for each participant Different prices paid will reflect differences in values between licences under in auction Conductive to truthful bidding Simultenous Multi Round Auction

4 OverviewTerms & Conditions for Participation Reserve Price Activity Rules Spectrum blocks Coverage Requirements, supervision Violation of Auction Rules and their Consequences Questions Policy Consulation Policy Statement and Consultation on Draft Regulations Approvement of Regulations, Announcement of Application Date (Auction Start) Auction starts Getting to start of an SPRK auction 1 month 1 -2 months

5 OverviewTerms & Conditions for Participation Reserve Price Activity Rules Spectrum blocks Coverage Requirements, supervision Violation of Auction Rules and their Consequences Questions Application Qualification of Participants Bidding Determination of Winners Allocation of the Rights of Use The key stages of a typical SPRK auction

6 OverviewTerms & Conditions for Participation Reserve Price Activity Rules Spectrum blocks Coverage Requirements, supervision Violation of Auction Rules and their Consequences Questions Spectrum blocks 2.6GHz 2.3GHz 800MHz (digital dividend) Spectrum block, MHz Bandwidth1MHz 10MHz (Operator 1) 10MHz (Operator 2) 10MHz (Operator 3) 11 MHz 10MHz (Operator 1) 10MHz (Operator 2) 10MHz (Operator 3) UseGuard bandDownlinkDuplex gapUplink Spectrum block, MHz Bandwidth 30MHz (Operator 1) 30MHz (Operator 2) 10MHz (Operator X) UseTDDRegional license Spectrum block, MHz Bandwidth 20MHz (Operator 1) 20MHz (Operator 2) 20MHz (Operator 3) 10MHz (Operator 4) 50MHz (Operator 5) 20MHz (Operator 1) 20MHz (Operator 2) 20MHz (Operator 3) 10MHz (Operator 4) UseFDD uplink blocksTDDFDD downlink blocks

7 OverviewTerms & Conditions for Participation Reserve Price Activity Rules Spectrum blocks Coverage Requirements, supervision Violation of Auction Rules and their Consequences Questions Terms and conditions for participation Participant: - Local or foreign company; - Companies with a decisive influence (direct and indirect) are not allowed participation in auction simultaneously;

8 OverviewTerms & Conditions for Participation Reserve Price Activity Rules Spectrum blocks Coverage Requirements, supervision Violation of Auction Rules and their Consequences Questions 1. Payment of the reserved price (at least 1 week before the auction starts);and 2. Submission of auction registration application (till the auction starts): 2.1. foreign operators - a certificate from business register that the bidder is not in liquidation and that the merchant has not been declared insolvent, or the proposed remedy at law 2.2. foreign operators - registration certificate 2.3. complete declaration of conformity 2.4. warrant of power attorney 2.5. the reserved price payment document 2.6. certificate/document attesting that the participant has no tax debt

9 OverviewTerms & Conditions for Participation Reserve Price Activity Rules Spectrum blocks Coverage Requirements, supervision Violation of Auction Rules and their Consequences Questions Determination of the reserve price includes consideration of such parameters: 1.Bandwidths for radio spectrum band/block (10MHz, 50MHz etc.) 2.Duration of rights of use for the specific radio spectrum band (10, 15 years etc.) 3.Territory of validity for rights of use (country wide or regionally) 4.Benchmarking of previous auctions’ reserve price 5.Benchmarking of theoretical coverage possibilities (2.3GHz cell radius is 1.8 times less than 900MHz or 1.87 time more than 3.8GHz etc.) Principles of setting

10 OverviewTerms & Conditions for Participation Reserve Price Activity Rules Spectrum blocks Coverage Requirements, supervision Violation of Auction Rules and their Consequences Questions Source: 450Seminar_Colombia/Presentations/2_CDG_CDMA450_Co lombia%20April%202009%20v1%20English%20(2).pdf 450Seminar_Colombia/Presentations/2_CDG_CDMA450_Co lombia%20April%202009%20v1%20English%20(2).pdf Technical Assumptions

11 OverviewTerms & Conditions for Participation Reserve Price Activity Rules Spectrum blocks Coverage Requirements, supervision Violation of Auction Rules and their Consequences Questions Latvian expierence setting reserve price Spectrum bandBlock sizePrice 2.6GHz FDD 2X20MHz LVL (≈ EUR) FDD 2X10MHz LVL (≈ EUR) TDD 50MHz LVL (≈ EUR) 2.3GHz30MHz LVL (≈ EUR) 800MHz2X10MHz LVL (≈ EUR)

12 OverviewTerms & Conditions for Participation Reserve Price Activity Rules Spectrum blocks Coverage Requirements, supervision Violation of Auction Rules and their Consequences Questions Aim : Constrain bidding & Affect incentives for strategic bidding -Bidder in active round is allowed to place a bid only for one spectrum block -By making a bid on a spectrum block, the bidder commits to pay for it the amount stated in the bid -The standing highest bid for a frequency block is the bid that has the highest value - Bidder must be active in each round (place a bid- the standing highest bid & increment (10% of the reserve price)) - Bidder with the highest offer in the next round is not allowed to place a bid for other spectrum block (except if there are 2 or more such bidders) - SPRK announces the auction concluded after a bidding round where no bidders have placed new bids on any frequency blocks Rules

13 OverviewTerms & Conditions for Participation Reserve Price Activity Rules Spectrum blocks Coverage Requirements, supervision Violation of Auction Rules and their Consequences Questions Collusion - No direct/ indirect information exchange between candidates/bidders with regard to the auction - No announcement of bidding strategy and/ or concrete bids - No influence of the participation or the bidding behaviour of third parties Denial of admission to and exclusion from the auction - Collusion - Breach of the auction rule - False information in the application - Non-fulfilment of the participation criteria Statutory violation and consequences

14 OverviewTerms & Conditions for Participation Reserve Price Activity Rules Spectrum blocks Coverage Requirements, supervision Violation of Auction Rules and their Consequences Questions Requirements Spectrum band Obligations 2.6GHz Till electronic communications service availability to at least 55% population 2.6GHz (TDD) Till installation and exploitation of at least 20 base stations in 20 different administrative areas 2.3GHz Till installation of and exploitation of base stations in at least 10 administrative areas 800MHz Till installation and exploitation of at least one base station on each 200km 2, except republican cities. 1) In technologically neutral manner 2) Allowing transfer to those operators who are not the winners 3) Allowing to withdraw rights of use without any compensation in case non- fulfillment of obligation criteria Rights of use are allocated:

15 OverviewTerms & Conditions for Participation Reserve Price Activity Rules Spectrum blocks Coverage Requirements, supervision Violation of Auction Rules and their Consequences Questions Questions?


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