REPORT: PROCEDURES FOR GRANTING INDIVIDUAL FRANCHISES FOR THIRD GENERATION MOBILE COMMUNICATIONS SYSTEMS
PRESS RELEASE
PRESS RELEASE
Report by the Authority on UMTS franchises
The Competition Authority, at its meeting on 5 May 2000, issued an opinion pursuant to section 22 of the Competition Act regarding the procedures for the issue of UMTS franchises, and submitted it to the Speakers of both Houses of Parliament, the Committee of Ministers responsible for tendering procedures, and the Chairman of the Communications Regulatory Authority.
In its report, the Authority noted that the UMTS tender was of great importance both on account of the technological innovation aspects of the UMTS system, and because of the interest bring shown by several companies within the European Union which requires franchises to be awarded on the basis of tenders from all eligible parties.
As already indicated in numerous reports on the same subject, the Authority pointed out that in order for the franchise-holders to be selected as efficiently as possible, the frequency market had to be exploited to the full, and the price therefore had to be established following a competitive procedure based on objective, non-discriminatory, proportional and transparent criteria.
By combining different types of criteria for awarding the franchise, some quantitative and others qualitative, it would be difficult to compare the bids and the tenders would lack the necessary degree of transparency because of differences between the bidders' prior market experience and infrastructure facilities.
Consequently, as far as the tendering procedures were concerned, the Competition Authority suggested that the final choice should be determined not so much on the most advantageous financial offer, based on a competitive price, but also by applying a procedure that would make it possible for repeat bids. This should be set out expressly in the invitation to tender, in full compliance with all the relevant rules and regulations.
This would make it necessary to draw a distinction between the qualification and the adjudication criteria. In the first phase of the procedure, tenders should be examined by apply technical and economic/financial criteria (example territorial or population coverage, or the quality and availability of the service); the second phase should focus solely on price, which would ensure an objective and transparent selection, by guaranteeing the best possible use of the available frequencies.
Rome, 8 May 2000