On January 25 2012 Brazil's telecommunications regulator (ANATEL) submitted to public consultation the draft bid notice for the 450 megahertz (MHz) and 2.5 gigahertz (GHz) radio frequency bands.
The 450 MHz radio frequency sub-bands (from 451 MHz to 458 MHz and from 461 MHz to 468 MHz) will be dedicated to the provision of fixed switched telephony services (FSTS), multimedia communication services and personal mobile services. The regulator has stated that these bands should be used to cater to the country's rural and remote regions, as determined by the General Plan of Universalisation Goals, approved by Decree 7,512 of June 30 2011.
One of the criteria for the 450 MHz band auction is to provide the lowest price to end users. If no parties are interested in purchasing this band, the associated obligations will be added to the commitments imposed on the winners of the auction for the 2.5 GHz band.
The 2.5 GHz radio frequency sub-bands (from 2,500 MHz to 2,690 MHz) will in turn be used to provide multimedia communication and personal mobile services, according to the allocation of each range of radio frequency. The main objective of the 2.5 GHz band bidding process is to promote access to high-speed mobile broadband, using fourth-generation mobile technology.
The successful bidders of the 2.5 GHz band will be required to commit to serving:
- the municipalities designated as hosts and sub-hosts of the 2013 Confederations Cup by May 31 2013;
- the municipalities designated as hosts and sub-hosts of the 2014 World Cup by December 31 2013;
- state capitals, municipalities with more than 500,000 inhabitants and the federal district by May 31 2014; and
- municipalities with more than 100,000 inhabitants by December 31 2015.
The draft notice also provides that the successful bidders of the 2.5 GHz bands must use products with Brazilian technology and commit to:
- between 2012 and December 2014, providing 60% of investment in goods or products with national content (of which 50% must accord with the basic production process and 10% in investments in goods or products with technology developed in the country);
- between 2015 and December 2016, providing 65% of investment in goods or products with national content (of which 50% must accord with the basic production process and 15% in investments in goods or products with technology developed in the country); and
- as of 2017, providing 70% of investment in products or goods with national content (of which 50% must accord with the basic production process and 20% in investments in goods or products with technology developed in the country).
The proposed notice further provides that bidders and their affiliates, subsidiaries or controlling companies that already have 2.5 GHz band radio frequencies may acquire new radio frequency sub-bands only up to a total maximum limit of 60 MHz (which may reach 80 MHz in some cases).
The draft notice will continue under public consultation until February 26 2012.
For further information on this topic please contact Ricardo Barretto Ferreira Da Silva, Fabio Ferreira Kujawski or Thays Castaldi Gentil at BARRETTO FERREIRA KUJAWSKI E BRANCHER – Sociedade de Advogados by telephone (+55 11 3897 0300), fax (+55 11 3897 0330) or email ([email protected], [email protected] or [email protected]).