GSMA and ASIET criticise Subtel, Supreme Court decisions on spectrum

3 Jul 2018

The GSM Association (GSMA) and the Inter-American Association of Telecommunication Companies (Asociacion Interamericana de Empresas de Telecomunicaciones, ASIET) have issued a joint statement raising concerns following two controversial rulings on spectrum holdings in June. The first saw sector watchdog the Department of Telecommunications (Subsecretaria de Telecomunicaciones, Subtel) ordering a halt to the use of 3.5GHz spectrum on the grounds that it was being under-utilised by the current licence holders and should be re-allocated. This was followed by a Supreme Court ruling that Movistar, Chile and Entel had engaged in anti-competitive practices by purchasing 700MHz spectrum that pushed them above the previously-established spectrum cap, and required those cellcos to return a portion of their frequencies (in any band).

The GSMA and ASIET warned that such decisions weaken ‘sectoral institutionality’ by contravening the policies implemented by the government and related agencies including the National Economic Prosecutor (Fiscalia Nacional Economica, FNE) and the Antitrust Tribunal (Tribunal de Defensa de la Libre Competencia, TDLC). According to the duo, it is ‘essential’ to reinforce the institutional framework and mechanisms to create an environment of predictability and transparency that can provide companies with confidence.

Regarding the specifics of the rulings, the statement argues that the spectrum cap enforced by the apex court’s decision is ‘anachronistic’ and that the ‘technological requirements of 2018 are very different from those ten years ago.’ Had the limit been enforced over the last decade, the statement goes on, Chile would not hold its place as a leader in Latin America’s digital ecosystem and nor would Chileans enjoy the level and quality of service they currently experience. Looking to future developments, the organisations warn that: ‘The ruling harms users and puts at risk the necessary investments for the expansion of 4G and the deployment of 5G, which is expected to be led regionally by Chile … The country must avoid judicialisation, uncertainty and institutional entrapment if it wants to achieve investments that will allow it to move towards 5G during the present government.’ To that end, the two groups offered to contribute ‘all their technical knowledge and international experience’ to help the Chilean government resolve the situation.