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ANCOM launches the radio spectrum auction for the provision of new generation electronic communications services

19.09.2022

“Today we are launching the auction for awarding radio frequency usage rights meant for the implementation of new technologies. After the publication in the Official Journal, on Friday, of the two decisions, all the conditions required for publishing the announcement on the launching of the selection procedure are now fulfilled. We reached this moment after a complicated process which we managed to complete only through a permanent dialogue with the factors involved: Romania’s government, the telecom industry and the civil society. We are waiting for the operators from Romania or from abroad, holders or not of radio spectrum resources, to participate in the auction. The conditions of this procedure are well adapted to the current socio-economic context. The Romanian electronic communications market is mature and one of the most competitive at the level of the European Union and this is owed to the investors’ ability and interest, as well as to the low barriers at the market entry for the providers. The increase of the spectrum amount will lead to new investments on the Romanian market, to the benefit of the entire economyMr. Vlad Stoica, the president of ANCOM, said.

The participation announcement and the documents concerning the organization of the competitive selection procedure for awarding radio frequency usage rights in the 700 MHz, 1500 MHz, 2600 MHz and 3400-3800 MHz bands are available for consultation here.

Participation in the auction

In order to participate in the auction, the interested persons must submit an application file to ANCOM and buy the Terms of Reference. The application file must contain documents presenting the candidate’s situation, which should show, among other, the fulfilment of the obligations to the state budget, the social security budgets and special funds respectively, as well as that the candidate in question meets the participation requirements: it has a turnover of at least EUR 10 million for the past year or a subscribed and paid-in share capital as the RON equivalent of at least EUR 1,000,000, it is not in a state of insolvency or liquidation, its business is not handled by a bankruptcy judge, its commercial activity is not suspended, it is not part of another applicant’s group, a.s.o. The application file will also contain the participation bond and the initial bid which is to indicate the amount of blocks the applicant wishes to acquire in each of the block categories available.

The entities interested in participating in the auction may submit the application file until 27 October 2022. The auction commission will analyse the submitted files and will announce, until 31 October 2022, the applicants that qualified to the next stage. Depending on the initial bids submitted by the qualified applicants, ANCOM will announce on 4 November whether the auction stage is required. In such case, the auction can actually start on 8 November 2022.

The Terms of Reference may be purchased starting 19 November 2022, every day, from Monday to Thursday between 09.00 - 16.00 hours and Friday between 09.00 - 14.00 hours, from the ANCOM headquarters in Bucharest, 2 Delea Noua Street, sector 3, or - at the request of the interested person - sent in physical or electronic form, based upon the submission by the interested person of the document proving the payment of a non-refundable amount of RON 5,000, standing for the value of the Terms of Reference, in original, and of the proxy of the person delegated to take the Terms of Reference.

Spectrum available in the auction

555 MHz in the 700 MHz, 1500 MHz, 2600 MHz and 3400-3800 MHz frequency bands will be auctioned out, for the winning operators to cover with broadband services at least 70% of the country's population, most urban areas, existing highways, international airports and modernised railways, as well as 480 settlements identified as not covered or poorly covered with mobile communications services.

Following the selection procedure, ANCOM will award usage rights to enter into force from 2023 and 2026 respectively, with a validity term of 25 years and respectively 22 years. Exceptions are the frequency usage rights in the 2600 MHz band, which will be valid for 6 years and 3 months, a validity term necessary for alignment with the other existing rights in this band.

The auction procedure

To award the spectrum, ANCOM will organise a competitive selection procedure, similar in broad lines to those organised previously. According to this procedure, each interested operator submits an initial bid whereby it indicates the number of blocks it intends to purchase in each of the available bands. The initial bids will show if there is higher demand for spectrum than the amount available in certain bands, if the demand matches the number of blocks available in each band (categories) or if the demand does not exceed the available spectrum amount. Depending on the initial bids, the auction stage will be held, which consists of primary rounds, followed, if such is the case, by an additional primary round and, lastly, by an assignment round.

The operators to win usage rights in the 700 MHz band and currently holding usage rights in bands below 1 GHz are imposed obligations of coverage with broadband mobile communications services correlated with a certain percentage of the population, within six years from the entry into force of the licences. If there will be new operators entering the Romanian electronic communications services market, the timeframe imposed for fulfilling the coverage obligations in correlation with the population percentage is eight years from the entry into force of the licences. According to the Terms of Reference, by means of the licences to be granted in the 700 MHz band, it is pursued the coverage of 95% of the highways and modernised railways with broadband mobile communications services within six years since the entry into force of the licences, by the operators that are currently holders of usage rights in the bands below 1 GHz. In addition, all the operators that will win rights in the 700 MHz band will have the obligation to cover 80 “white areas” localities/block, within six years for the existing operators that already hold rights in bands below 1 GHz, respectively eight years for a new entrant.

In the case of the operators that will win usage rights in the 3400-3800 MHz bands, they will have obligations of progressive roll-out of networks, by the installation of a number of base stations in various categories of urban localities, so that the holders could have operational 2,000 base stations, in eight years from the entry into force of the licences, respectively by 31 December 2033, if they currently hold rights in this band. These operators will also need to ensure the coverage with broadband services for all the international airports from Romania. The future licence holders, which do not hold rights in the 3400-3800 MHz band at present, will need to have operational, also by 31 December 2033, a number of 1,400 base stations.