Will European MSS get off the ground?

In our blog European Space War? we noted that the European Commission and the ITU may have a difference of opinion about the EU’s allocation of spectrum to 2 mobile satellite services’ (MSS) operators.  Inmarsat and Solaris Mobile were announced as the the lucky winners in the Official Journal on 12 June 2009.

Our earlier blog was really concerned about the issue of setting national spectrum licence fees for these MSS operators.  Set too low and the terrestrial mobile operators could easily get upset at being put to a significant disadvantage.  Too high and the whole project gets killed off or delayed, as happened to 3G.

So has Ofcom got the level right?  In their statement on licensing the complementary ground components, they have set the licence fee at £554,000 per 2 x 1 MHz nationwide, being the Administered Incentive Pricing of the GSM mobile operators’ spectrum first described in their January 2008 consultation paper (which has a very straight forward explanation of the 2GHz mobile satellite system, including the use at this spectum by complementary ground components).

Our gut instinct is that this is too high, given the overall costs of the infrastructure of mobile satellite systems complementary ground components AND the manufacture, launch and operation of the satellites themselves, particularly if this level of licence fees are set in all other member states.   Maybe that’s why we’re lawyers, and not regulatory economists?

We only met the once

We have been reminded by a judgement of the European Court of Justice concerning the meaning of “concerted practice” in Article 81(1) EC that a single meeting is sufficient to establish that there is a concerted practice.

The case arose because the national competition authority in the Netherlands had fined the country’s mobile phone operators in connection with an alleged concerted practice in breach of national competition law (Article 6(1)). “Concerted practice” in the Netherlands competition law is expressly defined as meaning any concerted practice with the meaning of Article 81(1) EC, so the case was referred by the Administrative Court for Trade and Industry to the ECJ for it to give a preliminary ruling on what was meant under Article 81(1) by a concerted practice.

In the UK the Chapter I prohibition on anti-competitive agreements etc. in the Competition Act 1998  includes the phrase “concerted practices” (section 2(1)), which would be interpreted by any UK court in line with this ECJ judgement.