Cyfrowy Polsat mulls infra sale as EC probes its 2013 licence issue

Cyfrowy Polsat mulls infra sale as EC probes its 2013 licence issue

The European Commission has launched an investigation into the Polish government’s allocation of an 800MHz spectrum holding to the operator Sferia in 2013.

In a statement, the EC authorities confirmed that the retroactive probe intends to ascertain whether the government contravened EU state aid laws by issuing the holding. TeleGeography reports that a 2x5MHz block was granted to Sferia with no selection procedure, no charge and no coverage obligations. EU regulations require member states to treat operators equally.

The Polish government had ordered Sferia to return a licence that it held in the same band which it used to offer fixed and wireless services using CDMA technology. The operator initially challenged the order in the International Arbitration Court, but dropped the case in exchange for receiving the 800MHz spectrum allocation ahead of the auction.

Several Polish operators have complained to the EC over this action. Orange, Play and T-Mobile did not receive an opportunity to obtain 800MHz spectrum – suitable for 4G/LTE coverage - until 2015, when they were required to bid for it at auction.

Collectively, the three operators spent PLN9.23 billion (which adjusted for inflation was equivalent to US$2.5 billion) for spectrum in the 800MHz and 2.6GHz bands. Additionally, these new licences included minimum coverage obligations.

The EC statement read: “At this stage and based on the information available, the Commission’s preliminary view is that Sferia may have been awarded by the Polish authorities 800MHz frequencies on more favourable terms than other operators and that, hence, the allocation may have amounted to state aid.”

Sferia is no longer active in Poland after it elected not to pay a PLN1.73 billion licence renewal fee in 2018.  The unit was part of the Cyfrowy Polsat group, which is currently mulling a divestment of its telecoms infrastructure.

The group has stated that it may sell 100% of shares in Polkomtel Infrastruktura, its infrastructure subsidiary that owns its passive and active mobile telecom assets. Broadband TV News reports that it is also considering a partial sell-off, strategic partnership, or a joint venture with a new investor.

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