Following the universal mobile telecommunications system (UMTS) public tender, the Portuguese authorities granted four UMTS licences in Portugal. The licences were granted to the three existing global system for mobile communication (GSM) operators - TMN, Vodafone and Optimus - as well as to a new entrant, OniWay.

In response to the delay in the launch of UMTS operations, OniWay executed a roaming agreement with TMN so that it could enter the GSM market and operate GSM services without having been awarded a GSM licence. In this sense OniWay can be considered the first Portuguese mobile virtual network operator, as it does not own a GSM network.

ICP-ANACOM, the Portuguese regulatory authority for the communications sector, considered this agreement to be lawful despite Vodafone's public objection. Vodafone argued that OniWay's operation of GSM services without holding the appropriate licence was against the law.

In line with this position, Vodafone refused to grant interconnection to OniWay, thus creating a barrier to the new player's entry to the market.

ICP-ANACOM recently ordered all four operators to negotiate interconnection agreements and set a deadline by which these agreements must be executed. Vodafone responded by declaring that it still had doubts about the legality of TMN and OniWay's agreement, and that it thus could not guarantee that an interconnection agreement would be concluded within the specified deadline.

However, as Vodafone and OniWay are currently in negotiations with one another, it may be expected that an interconnection agreement will ultimately be reached.

For further information on this topic please contact Margarida Couto at Vieira de Almeida & Associados by telephone (+351 21 311 3400) or by fax (+351 21 354 89 39) or by email ([email protected]).