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Chilean Operators Ordered to Return Spectrum over Hoarding Allegations

Chilean Operators Ordered to Return Spectrum over Hoarding Allegations

Chile’s top three mobile operators have been ordered by the country’s Supreme Court to return spectrum they obtained at auction in 2014.

The ruling upholds an appeal lodged by consumer rights group Conadecus in 2015 after Chile’s competition court TDLC (Tribunal de Defensa de la Libre Competencia) refused to investigate complaints that Claro, Entel, and Movistar were ignoring a 60MHz spectrum cap, thereby effectively hoarding spectrum.

Chile’s regulator Subtel (Subsecretaria de Telecomunicaciones de Chile) has now acknowledged that the operators bid without “respecting the limit of 60MHz that each incumbent can have in the advanced services market”, adding that “radio spectrum is a national good for public use that belongs to all Chileans.”

Instead of fining the operators, the Supreme Court ruled that they should “return the equivalent amount of radio spectrum acquired in the 700MHz band auction”, which was eventually issued to them in 2015 following delays to the allocation process.

Entel obtained 30MHz of 700MHz spectrum, while America Movil’s Claro and Telefonica’s Movistar both received 20MHz. While all three operators will need to surrender the same amount of spectrum, the returned blocks do not have to be in the same frequency band. Currently Entel has 130MHz of spectrum, while Claro and Movistar each have 115MHz.

The operators may challenge the ruling on the grounds that the Supreme Court has in effect wrested responsibility from Subtel for allocating spectrum, which would be unconstitutional. Movistar and Claro are reportedly considering filing a complaint with the International Centre for Settlement of Investment Disputes (ICSID).

Subtel last week suspended the 3.5GHz band after making separate allegations of spectrum hoarding against the operators. The regulator argued that the firms had not utilised the band efficiently enough and now intends to use the airwaves for 5G testing.

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