ARCEP publishes a legal note by Daniel Labetoulle explaining the conditions under which local governments may apply for a WLL-Wimax license

Paris, 11th October 2005

ARCEP is organising an application procedure to allocate two WLL-Wimax licenses in each of the 22 regions of Metropolitan France, and has received many questions from local governments regarding the legal ramifications of their applying for these licenses. So, ARCEP has asked Mr. Daniel Labetoulle, former president of the legal section of the Council of State, to examine the conditions under which local governments may apply for WLL-Wimax licenses in France from a legal point of view.

He examined three questions :

  • Since local governments are required to publish their deliberations, can they keep secret the amount of the fee proposed by a local government?
  • How can the license procedure be reconciled with the time required to form a grouping of local governments?
  • Given local government law, under what conditions may a local government authorise a third party to use the WLL-Wimax licence it has been granted ?

Daniel Labetoulle’s answers are given below.

FOR INFORMATION

Review of the call for applications procedure for the allocation of WLL-Wimax licenses in each Metropolitan region in the 3.4-3.6 GHz band 1/ Submission of a letter of intent before 14th October

In the preparatory phase for the procedure, interested parties must submit a letter of intent to ARCEP before 14th October. This gives applicants the time to examine possibilities for sharing frequencies with other candidates.

2/ Application confirmation before 6th January 2006

Following the preparatory phase, candidates must confirm their letters of intent by submitting to ARCEP their authorisation applications on 6th January 2006 (from 9.00 am – 5.00 pm), as per the conditions of the application procedure. ARCEP will examine the applications in order to determine whether there are sufficient frequencies in each region.

. if frequencies are sufficient in a given region: authorisations will be issued on a first-come, first-served basis

In regions where frequencies are sufficient, ARCEP will issue authorisations on a first-come, first-served basis. In this case, authorisations can be issued for regional or infra-regional coverage areas, i.e. cover an entire département or more than one city.

. if frequencies are insufficient in a given region: application dossiers must be submitted on 1st February 2006

In regions where frequencies are insufficient, ARCEP will hold a selection procedure (the so-called "beauty contest") in order to allocate two regional authorisations.

3/ Application dossiers must be submitted to ARCEP on 1st February 2006 by 12.00 noon at the latest for regions with insufficient frequencies

Candidates will be examined based on three criteria :

  • the contribution to regional development made by high-speed services
  • the project’s ability to encourage competition on the high speed market
  • the amount the candidate is willing to pay upon receipt of the authorisation (over and above the annual fee due for the availability and use of wireless local loop frequencies)

Frequencies will be allocated independently in each region in Metropolitan France. This means that any player may request, and possibly receive, authorisations in more than one Metropolitan region.


Note by Daniel Labetoulle

The purpose of this note is to answer questions regarding certain practical problems that local governments might encounter in applying for and using WLL frequency usage licenses, because of the specific rules that apply to them

I – The first question is related to the general principle of the publication of the deliberations of local governments: would this principle prevent a local government from keeping the amount of the fee it has proposed a secret from the other applicants for the same license, would this principle put the local government at a serious disadvantage?

I don’t believe so; and I believe that we can find a solution to this problem, not by forcing ARCEP to change it procedures (postponing the application and tenders calendar for local governments)—which would be legally fragile, psychologically and politically difficult and, in practice, awkward—but by using the possibilities offered by the law of local governments.

Let us distinguish between the public nature of a session of the local government’s governing body, on the one hand, and the publication of the decisions and public access to their content, on the other.

-1- While the Local and Regional Collectivity Code (CGCT) states that the sessions of the governing body are of a public nature, it adds the possibility of meetings in camera: see articles L.2121-18 (for municipalities), L.3121-11 (for départements) and L.4132-10 (for regions).

Declaring in camera hearings is legally subordinate to quite clear conditions of form: the decision must be taken (in open session) by an absolute majority of the members present or represented, and the governing body must be seised by its chairman or by a certain number of members. However, the decision to exclude the press and the public must be taken appropriately and can be taken for any question under the competence of the assembly. Nothing prevents it from being used for our hypothesis.

-2- It is true that the decision to meet in camera does not dispense the body from ensuring that the decisions taken are published (minutes, posting, information requests from the electorate). However, I believe that the only concern here is that the publication may be, without causing the rest of the procedure to be illegal, not immediately complete, and that elements which must remain secret until the deadline for the submission of tenders for the fairness of the competition, are not revealed before this date. This concern can be easily satisfied by practical precautions (e.g.: minutes which must be posted "…within one week…" [article L.2121-25] may simply state that deliberations decided on the amount of the fee, without immediately revealing the figure) which, under law, would be justified by a decision deliberate in camera and by the need for fair competition.

II The second question is how the license allocation procedure can be reconciled with the time required to form a grouping of local governments. Three comments can give food for thought.

-1- First, we must not assume that the procedure for forming a grouping to apply for a license would necessarily be so long as to be radically incompatible with ARCEP’s procedure. While, in practice, the formation of such groupings is often long, this is generally because of divergences among the local governments who are members of the grouping or because of the immaturity of the project. But if this is not the case, the procedure can be completed fairly rapidly. The local governments planning to create a grouping to present their application should establish an appropriate calendar, moving backwards from the application deadline.

-2- If, the project’s state of advancement prevents the completion of the grouping in time to submit an application, I do not believe that an association should be created as a sort of intermediate structure.

It is generally accepted (although the exact scope of this idea is somewhat unclear) that a local government may not assign to an association—and thereby remove from its normal system of public law—the competencies assigned to it by law and which help define its identity (cf. Revue française de droit administratif 2001 n°1 p 194 with a note by Professor Négrin). It is true that this case may not involve such a competency. But I believe that the answer follows directly from applicable text: when article L.1425-1 of the CGCT states: "...local governments and their groupings.." it seems clear that it is not speaking solely of the groupings listed in the code: public cooperation establishments (EPCI), inter-départemental or regional institutions (respectively articles L.5421-1 and L.5621-1), "mixed consortiums associating exclusively municipalities and EPCI" (L.5711-1) and probably mixed consortiums under articles L.5721-1 et seq. (which may include regions, départements, municipalities, EPCI and chambers of commerce, agriculture or trades); so, a decision by ARCEP which would allocate a license to local governments "hosted" by another structure would be very fragile.

III The third question is: to what rules of procedure specific to local governments would a local government be subject if it were to authorise a third party to use the license allocated to it under articles L.42-1 et seq. of the CPCE?

We should identify two hypotheses:

-1- In the first, the local government plans to assign the use of the license to an operator (while remaining the holder of the license). There would be either a contract or a public service delegation. The Procurement Contract Code must be observed in the first case, and the system of public service delegations, in the second.

-2- In the second hypothesis, the local government, holder of the license, plans to transfer it in application of article L.42-3 of the CPCE. Naturally, this article, which applies regardless of who is the holder of the license, must be respected. The problem is whether there are other constraints created by the system governing local governments: more precisely, would such a transfer require a competition and/or prior publication? Or could it take the form of negotiations? It seems to me that the second alternative must be chosen. The transfer is neither a procurement contract nor public service delegation. Article L.2241-1 of the CGCT, for municipalities, (article L.3213-2 for départements; article L.4221-4 for regions) states that consultation of the State Property Department must precede any deliberations regarding the transfer of property or of rights in rem in immovable property. However, the transfer of a license delivered in application of article L.42-1 of the CPCE does not involve property or rights in rem in immovable property. Obviously, the transfer would have to be decided upon according to the usual forms of law governing local governments, with the intervention of the governing body. But, I do not see any particular constraint under this law related to the nature of the transfer.

5th October 2005.

Daniel Labetoulle


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