Tele2 protests against spectrum fee increases

25 Apr 2014

In an interview with local newspaper Vecernji List, Tele2 Croatia’s CEO Malin Holmberg said that mobile spectrum fee increases recently proposed by the Croatian government would take away 97% of the Swedish-owned cellco’s EBITDA based on 2013 annual figures. In comparison, the measures would cut 14% and 4% of EBITDA at rivals VIPnet and T-HT respectively, according to Tele2’s calculations, with the company pointing out that it disproportionately suffers from the extra charges because it operates only in the mobile segment while its two main rivals offer fixed line and broadband services. Holmberg argued that ‘the current proposal is discriminatory and contrary to the principles of competition and a direct attack on the freedom to provide services and violations of legal certainty within the legal framework of the European Union (EU)’ – specifically ‘a violation of Articles 12 and 13 of Directive 2002/20/EC of the EU (the so-called authorisation directive).’ She continued that ‘the Croatian constitution states that tax should be proportionate and in line with the economic power of taxpayers.’ Tele2 Croatia – which is operating at a net loss – has suggested that instead of the current proposals to increase spectrum fees, the government should instead consider bringing in additional income taxes. The Finance Ministry’s latest plan envisages raising an extra HRK330 million (USD59.8 million) to help reduce the state budget by charging mobile operators an annual HRK500 per MHz of licensed radio spectrum alongside other regulatory fees amounting to 0.5% of annual revenues and HRK60 per registered mobile user.