Cellcom and Golan Telecom continue to seek approval for network sharing deal

27 Apr 2015

Following last week’s revelation that Israel’s Ministry of Communications (MoC) had approved a network sharing agreement between Partner Communications and HOT Mobile, rivals Cellcom and Golan Telecom are reportedly looking to convince the regulator to give the green light to their proposed tie-up.

As previously reported by CommsUpdate, in September 2014 Cellcom announced that it had updated an existing 2G/3G indefeasible rights of use (IRU) agreement and 4G network sharing agreement with Golan. With the revised agreements valid for a ten-year period, they included ‘stipulations as to ownership and mutual IRU rights in the 4G radio equipment as well as the establishment of a joint venture for the joint operation of the 4G radio network’. However, in March 2015 the MoC was said to have notified Cellcom and Golan that the proposed network sharing agreements required ‘substantial changes’ before they could be given regulatory approval.

According to Globes Online, with Cellcom and Golan having insisted that their agreement is similar to the one signed between Partner and HOT they are now pressing to obtain regulatory approval for the updated contracts, arguing that their agreement meets the MoC policy, which sets general guidelines for such deals. However, issues related to matters of ownership and the services that Golan will purchase from Cellcom’s 3G network are thought to be a sticking point. While the terms of joint ownership and investments are said to be clearly defined in the Partner/HOT deal, Cellcom and Golan have claimed that they should not need an identical agreement, due to the latter’s more recent entrance to the cellular sector. Such suggestions though could open the MoC to legal challenges to its rulings should the deal be substantially different from the network sharing deal it has already approved. Meanwhile, it has been noted that Golan may prefer to wait until the government appoints a new communications minister to present its agreement with Cellcom for approval.