ARCEP publishes a legal report on the mechanisms for implementing the "secondary frequency market" and their articulation with the competences of regional governments.It approves the first partial transfer request for WiMAX frequencies from one regional government to another.

Paris, 29 January 2007

In July 2006, ARCEP assigned wireless local loop (WLL) frequencies usage authorisations in the 3.4-3.6 GHz band (WiMax technology) in the 22 Metropolitan regions. Six regional councils were among the chosen candidates.

Regional governments and their groupings may be assigned WLL frequencies authorisations under the competence assigned to them under Article L. 1425-1 of the local and regional collectivity code.

• Clarifying the legal conditions of transfer mechanisms and provision of WiMAX frequencies in the unique context of regional governments 

Texts in force plan and stipulate two "secondary frequency market" mechanisms (transfer and provision) applicable to WLL frequencies. These allow holders of frequency usage authorisations (whether regional governments or private operators) to transfer all or part of their rights, thereby facilitating access to the spectrum, based on regional development needs or commercial objectives.

Many questions have been asked by players, both public and private, on the legal means of transferring and making available WLL frequencies, especially with respect to advertising and competition rules which govern the action of regional governments.

In order to clarify the legal aspects of these questions, ARCEP has asked Christine Maugüé, Councillor of State, for her expertise. She has submitted her report, which ARCEP is publishing today.

Her main conclusions are as follows:

- The transfer and provision of frequency usage authorisations are not subject, as such, to the advertising and competition rules which govern the deliberations and actions of the regions.

- In principle, a frequency usage authorisation should be transferred against payment, although it could be transferred at no charge if the beneficiary is subject to constraints of general interest (such as for a public service delegation).

- For a single frequency usage authorisation, a regional government may use the transfer and provision mechanisms for public (other regions) or private (operators) persons.

- The provision of frequencies for a public service delegation being signed or executed may, in some cases due to the economy of the public contract and its degree of precision in the means of providing high speed, justify a new procedure or delegation agreement.

- Regional governments using a procurement contract or a public service delegation including WiMAX services do not necessarily have to be the holders of the frequency usage authorisation which allows the use of the frequencies.

• Clear player interest in the secondary frequency market

Right from the start, the wireless local loop application procedure included transfer and provision mechanisms, which had already been implemented by a number of players.

A first case of partial transfer of a WiMAX frequencies authorisation was implemented in Alsace

At the joint request from the Alsace regional council (which won one of the two WiMAX licences for the Alsace region in July 2006) and the Haut-Rhin General Council, ARCEP recently authorised the transfer of part of this authorisation to the geographic base of the Haut-Rhin département.

A new authorisation grants the Haut-Rhin General Council rights and obligations regarding the use of wireless local loop frequencies; another authorisation redefines the rights and obligations of the Alsace regional council on the Bas-Rhin département, in accordance with the transfer request submitted by the two regions, which was examined and approved by ARCEP.

This new sharing demonstrates a quick and dynamic implementation of the secondary frequency market in France and illustrates one of its most innovative applications: partial transfer (here on a geographic basis).

In this case, partial transfer is integrated perfectly, allowing a player which had not participated in the initial application procedure to gain access to the spectrum at a later date.

A case of WiMAX frequency authorisation provision by France Telecom has been approved

In October 2006, ARCEP also approved the provision request for SPM Télécom for WiMAX frequencies won by France Telecom in Saint Pierre et Miquelon.

Unlike with transfer, which requires sharing and a transfer of rights and obligations between the initial authorisation holder and the beneficiary, provision allows a holder to grant operation of all or part of its rights to the frequency to a third party, without giving up ownership. In this case, the obligations to ARCEP and third parties attached to the frequency remain the sole responsibility of the holder.

Along with the partial transfer of the Alsace Regional council to the Haut-Rhin General Council, we see that the entire measure (full transfer, partial transfer and provision) has now been implemented by players within half a year, demonstrating their interest in these new tools.

• Many frequency bands are open to the secondary market

The introduction of the secondary frequency market will allow for better use of the spectrum. It demonstrates the authorities’ dedication to increasing the role of the market in distributing frequency authorisations:

- Economic players can now redistribute frequencies based on market mechanisms and local digital development needs.

- This new tools will thereby allow the extension of some authorisations (provided the conditions of competition and total spectrum rules are respected) or the arrival of new players specialising in the operation of small areas or of small quantities of frequencies, in order to meet market needs which may have been poorly targeted by general operators.

The frequency bands open to transfers are listed in the order dated 11 August 2006. They concern fixed (WLL, HF), mobile (PMR) and satellite uses.

A national frequency register will soon be made available on ARCEP’s web site, so that the holders of authorisations in each region can be identified and transactions can be monitored in order to complete this already fully operational measure.