ARCEP applies its newfound power to impose sanctions, and withdraws frequencies from three mobile operators in French overseas markets

Paris, 17th July 2015

ARCEP has implemented every stage of its newfound power to impose sanctions for the first time

In 2013, the legal provisions relating to ARCEP’s ability to impose sanctions – which enable the Authority to enforce the obligations it is responsible for enforcing – was ruled unconstitutional by France’s Constitutional Council (Conseil constitutionnel). Since the Order of March 2014, completed by the Decree of August 2014, ARCEP’s ability to impose sanctions has been restored. This power is now exercised by two distinct bodies inside the Authority’s Executive Board:

On 19 May of this year, ARCEP sanctioned three operators for the first time since then. All of the procedural steps required to impose such a sanction have been completed:

• September 2014: the body responsible for proceedings and investigations instigates the procedure;
• October 2014: the operators are sent a formal notice to comply with their obligations, according to a timetable spread out over three stages;
• January 2015: it is ascertained that the operators have failed to meet the obligations set for the first deadline;
• February 2015: proceedings begun against the operators by notifying them of the objections, and by submitting the case to the body responsible for imposing sanctions;
• February-March 2015: the body responsible for imposing sanctions sets the timetable for the procedure, provides the operators with the elements of the investigation file, and invites them to respond with their justifications;
• April 2015: meeting with the operators;
• May 2015: it is ascertained that the operators did not comply with the order, and a penalty is imposed.

ARCEP withdrew the frequencies allocated to the three overseas mobile operators, due to their failure to comply with rollout obligations and to pay their licensing fees.

The three operators in question are Guadeloupe Téléphone Mobile, Martinique Téléphone Mobile and Guyane Téléphone Mobile. In 2008, these three companies were allocated spectrum resources in the 900 MHz, 1 800 MHz and 2.1 GHz bands to deploy 2G and 3G mobile networks in the departments of Guadeloupe, Martinique and Guyana. These licenses carried several obligations, notably the deployment of 2G and 3G networks and the payment of licensing fees.

ARCEP conducted regular verifications since 2008 to ensure that these companies were complying with their obligations. The conclusions of these verifications led ARCEP to issue all three operators with a notice to comply in 2011. Because of the Constitutional Council’s objections to the legal provisions concerning ARCEP’s ability to impose sanctions, this procedure could not be carried to completion.

On 19 May 2015, having ascertained that seven years after having been allocated the frequencies, the operators had yet to perform any rollouts, and were still heavily in arrears in the payment of their licensing fees, the sanctioning body decided to proceed with sanctions. Given the gravity of these failures, it decided to withdraw the frequencies that had been allocated in 2008, and to make these sanctions public.

The three companies appealed to France’s highest administrative court, the Conseil d’Etat, to obtain a suspension of these decisions. In an order dated 8 July 2015, the Conseil d'Etat relief judge rejected all three companies’ appeal.