The alternative operators Freenet and Ewe Tel have won a legal victory in Germany over the conditions of the 5G spectrum licences issued in 2019. The MVNOs were concerned the government had interfered to remove the so-called service provider obligation, for licence winners to provide network access to MVNOs. The Cologne administrative court has ruled the Federal Networks Agency must reconsider competition on the German market and possibly adjust the 5G licences accordingly.
In an effort to encourage the German operators to improve coverage in rural areas, the Bundesnetzagentur softened the wholesale obligations in the licences issued in an auction in 2019. As a result the mobile operators are not required to provide network access to MVNOs, and only have an obligation to negotiate when a MVNO requests wholesale capacity. The alternative operators claim the regulator was put under political pressure by the German government to make the change, and this was a violation of the independence of sector regulators guaranteed under EU law.
Ewe said it was still feeling the effects of the change in policy by the regulator to this day. “We have sued for fair decisions, fair access and fair prices,” said the corporate spokesman Norbert Westfal, “we don’t want to be given anything for free. But so far we have not received the offers from the network operators that we need to meet our customers’ needs.”
Political bias
As a result of the court ruling, the award of the 5G licences is no longer considered legal. The Federal Network Agency must look again at the requirements for the licensees, taking into account the court’s assessment of political influence in the original procedure. A new decision on the licence terms must be taken independently, based on a re-evaluation of the mobile market conditions and whether the service provider obligation is necessary to support competition.
The MVNOs had opposed the licence terms already before the auction, and obtained documents under the Freedom of Information Act that show German government ministries had undue influence on the discussions in 2018 at the Bundesnetzagentur over the 5G auction. Nevertheless, the regulator won several legal appeals, before and since the auction.
In 2021 the operators’ appeal reached the German Federal Administrative Court. The higher court found that procedural faults may have occurred at the telecoms regulator, and in particular the transport and digital infrastructure ministry (BMVI) weighed in on the coverage obligations, affecting the Bundesnetzagentur’s independence. The federal court sent the case back to the Cologne district to reconsider the matter, resulting in the final decision by the Cologne court that the regulator most likely would have decided differently if it had not been for the bias introduced by the ministry.
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