Dutch mobile operator Telfort, which is now owned by KPN Telecom, has lost its initial appeal seeking to overturn a ruling by the radiocommunications regulator Agentschap Telecom (AT) requiring it to use its UMTS spectrum. Telecompaper reports that a Rotterdam court ruled in favour of the AT at the preliminary injunction case, meaning that Telfort can only use its own UMTS frequencies and not those held by its parent company. KPN reached an agreement to acquire Telfort for a total consideration of EUR980 million (USD1.17 billion) on a debt and cash free basis in June 2005. Since then it has been steadily moving Telfort’s 2.4 million subscriber base over to its own KPN Mobile network. The court upheld a EUR5 million fine imposed on Telfort by the AT for failure to use the spectrum and could impose further fines up to a maximum of EUR40 million for its continued breach of the law. The court further ruled that Telfort must provide an available UMTS signal, separate from KPN’s coverage, so that users can access the frequencies held by Telfort. The AT meanwhile, is calling on Telfort to relinquish the frequencies so they can be reassigned to other operators.