Moving on to Whiter and Snowier Pastures

I am pleased to announce that, effective January 4th,  2011, I have taken on the role of Public Policy Counsel at Research in Motion in Waterloo, Canada.  I am now part of the RIM Legal Department and my work is focused on global regulatory and public policy matters.  Since my work is no longer centered on the Caribbean, I do not expect to update this blog on a regular basis.  I hope that you found it to be helpful.  If you have any question, please don't hesitate to contact me at dlaliberte@rim.com.

ECTEL Consultation on Regional Radio Spectrum Plan

On September 28th, the Eastern Caribbean Telecommunications Authority (ECTEL) completed a public consultation on a proposed review of its 2006 Regional Radio Spectrum Plan.  The consultation document, published in August 2010, does not address the 700 MHz band as it was the subject of a separate consultation in 2008-2009 (as previously mentioned on this blog).  It does, however, discuss a number of spectrum-related issues of importance to the Caribbean broadcasting and telecommunication industry, including WiMax.  The modifications to the Plan proposed by ECTEL can be broadly grouped under four headings:

• Television and Radio Broadcasting Services:  ECTEL proposes to modify some of the frequencies allocated to broadcasters including 1605-1705 kHz (AM radio stations), 88.1-88.9 (low-power FM community radio stations), 235-267 MHz (digital audio broadcast services), 335 MHz-399 MHz (studio-to-transmitter links), 454.975-462.5625 MHz and 467.7125-470 MHz (outside broadcast television and radio).

• GSM Services:  The consultation document proposes to allocate the 912-915 MHz band to GSM service in Dominica.  This proposal may prove to be problematic as this band is currently allocated to ISM by the ITU-T in Region 2 countries,  which includes Dominica.  ECTEL also proposes to allocate, in all ECTEL countries, the 1710-1990 MHz band to GSM service and the 1990-2025 MHz band to "future Mobile Services; eg 3G mobile services".

• Broadband Services:  While the wording of the consultation document is somewhat unclear, it appears that ECTEL intends to allocate the 3.4-3.6 GHz band to fixed WiMax service and the 2.3-2.4 GHz band to mobile WiMax service.  There would be provision for licences to be awarded to four providers with 25 MHz each (5 blocks of 5 MHz each), plus one operator with 22 MHz (3 blocks of 5 MHz each, and one block of 7 MHz), in each band.  In addition, 120 MHz of spectrum would be made available in the 2.5 GHz band.  This spectrum would be assigned to a maximum of four operators (2 blocks of 15 MHz each) on a technology-neutral basis as this band can be used for WiMAX, IMT 2000 and MMDS service.

• Land Mobile Services:  ECTEL is proposing to allocate the 148-174 MHz band to VHF land mobile band (with 156-163 MHz allocated for maritime mobile use) in order to facilitate the implementation of a nationwide/regional public-private network for emergency, Government, Police, etc. 

In their respective submissions, Digicel and LIME requested that ECTEL modify these proposals in order to accommodate the spectrum requirements of products they intend to offer in the Eastern Caribbean in the near future (and which they currently offer in Jamaica).  Digicel's submission disagreed with ECTEL's proposal to limit the assignments to 30 MHz per operator within the 2.5 GHz band.  According to Digicel, this is an insufficient allocation of spectrum given the volume of traffic that is expected to be generated by WiMax services.  Instead, it suggested that the available 120 MHz of spectrum be assigned to a maximum of two operators (4 blocks of 15 MHz each).  This suggestion was presumably an attempt by Digicel to harmonize the WiMax spectrum allocation in the Eastern Caribbean with its own WiMax licence in Jamaica.

LIME's submission was more focused on mobile television services.  It requested that ECTEL clarify which of the frequencies set aside for broadcasting services would encompass mobile television service. In addition, LIME requested that the UHF band (470-862 MHz) be made available for mobile TV services.  Again, LIME's arguments appeared to be an attempt to harmonize the frequency allocations in the Eastern Caribbean with its own mobile television licence in Jamaica.

Haiti Regulator Adopts Interconnection Guidelines

Last week, the Conseil National des Télécommunications (CONATEL), the telecommunications regulator in Haiti, adopted new guidelines for the interconnection of telecommunication networks.  These guidelines provide detailed information on the procedure to be followed by new operators seeking to interconnect with existing operators, the content of interconnection agreements and the role of CONATEL in resolving interconnection disputes.

To my knowledge, these are the first interconnection guidelines issued by CONATEL since the Haitian telecommunications market was opened to competition in 1999.  Under their current licences, the operators are required to negotiate interconnection agreements, but little regulatory guidance is provided for the negotiation of these agreements (see, for example, art. 11 of the Teleco licence).  Whilst the operators have done their best over the past few years to negotiate interconnection agreements, the rights and responsibilities of each party (and of CONATEL) were not clearly specified under Haitian law.

It is not surprising, therefore, that Haiti has faced several interconnection disputes over the past decade.  In the summer of 2006, for example, Le Nouvelliste reported that Digicel was refusing to sign the interconnection agreement previously signed by Comcel et Haitel.  This dispute was eventually resolved, in September 2006, when Digicel, HaiTel and Comcel signed interconnection agreements.  Later, in October 2007, the incumbent fixed-line provider, Teleco (recently purchased by Viettel, the largest Vietnamese telecom operator) ceased all interconnection with Haitel due to non-payment of interconnection fees. This dispute was later resolved, following a ruling of the Haitian courts.

Interconnection disputes will continue to be a fact of life in the Haitian telecommunications market, despite the adoption of these guidelines. However, the adoption of these guidelines will clarify the rights and obligations of the parties.  This, in turn will make Haiti a more attractive and predictable market for investors wishing to enter the telecommunications market.

Digicel to Challenge Bermuda Tower Decision

On Friday, the Bermuda Sun reported that Digicel has launched a court challenge of a decision of the Bermuda Department of Planning, which denied Digicel's request for retroactive approval of a 35ft cellular tower.

According to the Sun's article, the Department determined in 2009 that a 23ft pole had been erected by Digicel on Knapton Hill, Smith’s, with the agreement of the landowner, but without the prior approval of the Department.  A retroactive application was subsequently submitted, but then withdrawn after Digicel realized that this property is not zoned for trade or business.  A few months later, in February 2010, Digicel was ordered to remove the tower.  Instead of complying with this order, Digicel replaced the 23 ft tower with a 35 ft one.    

In March 2010, Compu-Cad Ltd filed a retroactive application on behalf of Digicel to retain the structure.  This request was denied on the basis it was contrary to the zoning order and had an “adverse visual impact” on neighbouring property.  The board also noted that Digicel had shown “a blatant disregard for the planning process”.  Digicel then appealed the decision to the Minister responsible for Planning, Glenn Blakeney, who dismissed the appeal at the beginning of September.

The Department of Planning has now ordered Digicel to remove the tower by the end of this week. If Digicel does not comply with this order, the Department could decide to take enforcement action in the Supreme Court of Bermuda.  Instead of waiting for this enforcement action, Digicel has decided to launch proceedings in the Supreme Court of Bermuda to challenge the denial of its planning application.  

The Sun's article does not specify the legal arguments that Digicel intends to make before the Supreme Court.  Therefore, it is difficult for me to comment on Digicel's chances of success.  In other jurisdictions, however, it is quite common for telecom operators to encounter opposition to the construction of cellular towers and masts.  Digicel has been involved in similar proceedings in several jurisdictions. In December 2003, for instance, an interim injunction was issued (and subsequently rescinded) by the Jamaica Supreme Court to stop the construction of a cell site in Saint Andrew, Jamaica.  

More recently, Digicel was deemed by the chiefs on the island of Pentecost (Vanuatu, South Pacific) to have damaged an historical site when building a cellular tower.  Digicel was sanctioned with the highest penalty the chiefs can impose for wrongdoing: 10 tusked pigs!

URCA Opens New Spectrum Bands

On Friday, the Bahamas Utilities Regulation and Competition Authority (URCA) published a consultation document to solicit views on the proposed opening of new spectrum bands and to invite expressions of interest for frequency assignments from interested parties.  This consultation is described in the news release as a follow up to the publication of the Bahamas National Spectrum Plan in March 2010.

The spectrum bands under consideration in this consultation are 700 MHz, 11GHz, 12GHz and 40GHz.  According to the consultation document, these frequencies are currently unassigned.  URCA will not mandate the use of any specific technology in these bands, provided that the technology to be used conforms to recognized standards, the National  Spectrum Plan and any specific frequency band plan.   It also proposes general procedural guidelines to be followed by URCA when determining to open new spectrum bands and for the issuance of frequencies in such bands

It remains to be seen whether URCA will receive any concrete proposal for the use of 700 MHz band.  ECTEL conducted similar a consultation on the 700 MHz bands in 2008 and the Cayman Islands' Information and Communications Technology Authority did the same in 2009.  In these consultations, Digicel and LIME expressed interest in utilizing this spectrum at some point in the future.  However, they were reluctant to provide specific proposals with short or medium-term deployment timeframes.  This reluctance was likely due to the embryonic nature (at the time) of the Long Term Evolution (LTE) network being deployed by Verizon in the 700 MHz band, and perhaps also Qualcomm's MediaFLO service.  Telecom vendors including Alcatel-Lucent, Ericsson, Huawei, had yet to roll out 700 MHz LTE gears in real-world environments.  Hence, it appears that Digicel and LIME may have decided to wait for these real-world 700 MHz deployments before making firm commitments on the use of this band in the Caribbean. Two years later, these real-world deployments are now a reality.  Therefore, it will be interesting to see how the Caribbean telecom industry responds to the URCA consultation.

Comments are due on November 1st.

France Telecom Fined For Anti-competitive Behaviour in the French West Indies

On September 23, the Paris Court of Appeal upheld a decision by the French Competition Authority, which convicted France Telecom and its wholly-owned subsidiary, Orange Caraïbe, of anti-competitive behaviour in the Guadeloupe, Martinique and French Guyana.

This case dates back to July 2004, when Bouygues Télécom Caraïbe (later acquired by Digicel, in 2006) lodged a complaint against France Telecom and Orange Caraïbe.  Outremer Telecom followed suit with a similar complaint in 2005.  In their complaints, Bouygues and Outremer alleged that Orange Caraïbe, the incumbent operator with a market share in mobile telephony services of more than 75% (at the times of these events), implemented a series of practices designed to hinder the entry of new competitors in these markets.  These practices included the establishment of exclusive relationships with independent retailers and setting a price difference between on-net and off-net calls. Bouygues and Outremer also complained that France Telecom gave volume-based discounts to business customers for land-line calls going only to the Orange Caraïbe network. In addition, they alleged that France Telecom marketed "land-line to mobile" products to business customers, at costs below what an equally efficient operator would be able to bear in order to offer the same service (a.k.a. margin squeeze).

In December 2009 decision, the Competition Authority ruled that these practices breached articles L420-1 and L420-2 of the Commercial Code and  articles 101-102 of the Treaty on the Functioning of the European Union.  Orange Caraïbe and France Telecom were jointly and severally fined in the amount of EUR 52.5 million.  Further, the Authority imposed a fine of EUR 10.5 million for the practices carried out specifically by France Telecom.  In last week's decision, the Paris Court of Appeal confirmed the EUR 52.5 million fine, but reduced the France Telecom fine from EUR 10 million to EUR 7.5 million.
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Update (September 30, 2010, 12:44 EST):  Yesterday, Outremer Telecom issued a news release indicating that it intends to sue Orange Caraïbe and France Telecom in damages as a result of the Paris Court of Appeal's decision.

Digicel Challenges Constitutionality of Antigua & Barbuda Legislation

On Saturday, the Antigua Observer reported that Digicel has initiated legal proceedings in the Eastern Caribbean Supreme Court to challenge the constitutionality of the monopoly held by LIME on international calls coming in and out of Antigua & Barbuda.

According to article, Digicel is arguing that the Antigua & Barbuda Telecommunications Act (and by extension the monopoly granted to LIME) amounts to an unconstitutional hindrance to free speech and the freedom to receive and communicate ideas, which is protected by section 12 of the Antigua & Barbuda Constitution. This challenge appears to have been initiated in response to an earlier action brought by LIME in July 2010, in which LIME is claiming that Digicel is routing international calls in violation of LIME's exclusive international gateway licence.  This case is scheduled to be heard by the Court on Thursday this week.

Digicel's constitutional argument is not new - it has been tested before the Eastern Caribbean and UK courts, specifically in Cable and Wireless (Dominica) Limited v. Marpin Telecoms and Broadcasting Company Ltd.  In this case, Marpin Communications, a cable television provider in Dominica, expanded into Internet service provision through an agreement with Cable & Wireless. In 1998, its 1-800 connection through C&W was disconnected. Marpin took C&W to court, arguing that the legislation and licence conferring monopoly powers on C&W amounted to a breach of its freedom of expression.

Judge Cenac of Dominica agreed with Marpin, and so did the Eastern Caribbean Appeals Court and, ultimately, the Judicial Committee of the Privy Council.  The presiding judge felt that there was no question that Marpin’s freedom to communicate ideas and information was significantly hindered by the monopoly. They also cited the case of Retrofit Zimbabwe, a company that wanted to set up a mobile cellular system to compete with the state monopoly. In this case, unanimous rulings by Zimbabwe’s Supreme Court declared that the monopoly infringed freedom of speech and that this infringement went further than could be reasonably justified in a democratic society.

However, regardless of the merits of Digicel's position (or lack thereof), there is a more fundamental issue at play here...In this day and age, is there any public policy rationale for maintaining a monopoly on international calls?  Comments are welcome...