Approaches to Transitioning to New Authorization Regimes

This Practice Note outlines some of the approaches that have been adopted to transition to new authorization regimes. 

One approach is to deem that existing licensees have submitted all documentation required under the new licensing framework to obtain an authorization in respect of services and networks that they were previously authorized to provide.  Thus, existing licensees are automatically issued an equivalent authorization under the new licensing regime.  Estonia adopted this type of approach when it implemented an open entry policy in response to the E.U. Authorization Directive.

South Africa adopted a similar approach when it introduced the Electronic Communications Act (ECA), which created a new set of multi-service authorizations.  Chapter 15 of the ECA addressed the transition of existing licensees to the ECA licensing regime.  Pursuant to this Chapter, the Independent Communications Authority of South Africa (ICASA) was required to convert existing licences to one or more new authorizations under the ECA on no less favourable terms within 24 months of the introduction of the ECA.  Thus, the transition to the new authorization regime was automatic and mandatory.  Key features of the transition process are highlighted in Box 1.

Box 1: Features of the Transition to the Multi-Service Authorization Regime in South Africa

Chapter 15 of the Electronic Communications Act, 2005 (ECA) sets out the general framework for the transition to South Africa’s new technology- and service-neutral multi-service authorization regime.  The key features of the transition include:

 

--Mandatory migration to the new authorization regime.  The migration occurs through a conversion of existing licences to one or more licences that comply with the ECA. 

--The Independent Communications Authority of South Africa (ICASA) must convert all existing licences by granting new licences that comply with the ECA within 24 months of the adoption of the ECA.  (The schedule for conversion has been extended into 2008.)

--The new licences must be granted on no less favourable terms than the existing licences.  However, as part of the conversion process, the ICASA may grant rights and impose obligations on a licensee to ensure that existing licences comply with the ECA.

--All existing licences issued under the Telecommunications Act (one of the predecessors to the ECA) remain valid until converted to a new licence by the ICASA.  Existing licences remain subject to all terms and conditions that are not inconsistent with the ECA until these licences are converted and re-issued under the ECA.

--All licences converted pursuant to the ECA retain their original term of validity unless otherwise specified by the ICASA.

--Once an existing licence is converted and re-issued, the new licence is governed by the terms of the ECA and the existing licence is considered to have been surrendered and is of no force or effect.

--The ICASA is not permitted to grant or to include in the terms of a converted licence any monopoly or exclusionary rights in any network or services contemplated in the ECA or related legislation.  Existing monopoly and exclusionary rights are null and void, subject to the proviso that radio frequency spectrum that is assigned to a licence holder is not considered to be a monopoly or to constitute exclusionary rights.  

Source: South Africa, Electronic Communications Act, 2005, Act No. 36, 2005, Chapter 15

 

Ireland took a slightly different approach to its transition to a general authorization regime.  The Irish regulator, ComReg, opted not to automatically issue general authorizations to all service providers and operators that held authorizations issued under the old regime.  Instead, ComReg required all providers and operators to submit the necessary Notification Form to obtain a general authorization. 

 

The transition to the general authorization regime in Ireland involved a logistical problem, however.  The new general authorization regime became effective on July 25, and all previously issued authorizations were invalid as of this date.  However, service providers and network operators were not able to obtain general authorizations by July 25 to replace their previous authorizations. 

 

To resolve this logistical problem, ComReg deemed that, in the case of existing operators and service providers, Notification Forms filed by August 31 would have retroactive effect back to July 25.  In effect, service providers and operators that previously held valid authorizations were deemed to be authorized to provide services and networks in advance of filing the necessary documentation to obtain a general authorization so long as the filing was completed by August 31.  Existing licensees thus enjoyed a “grace period” between July 25 and August 31, during which they were permitted to offer services and operate networks under a general authorization without having yet complied with the formal requirements for obtaining the general authorization.

 

OFCOM, the ICT regulator in the U.K., faced a somewhat similar issue.  In the U.K., telecommunications licences were revoked and replaced by general authorizations before conditions could be imposed on the authorizations issued to dominant service providers pursuant to the terms of the Authorization Directive.  This created a regulatory gap in which the market power of dominant service providers was not constrained to prevent anti-competitive conduct.  OFCOM addressed this gap by granting “continuations”.  These grants continued the applicability of the conditions in telecommunications licences after the licences themselves had been revoked. 

 

Some countries give existing licensees the option to continue to operate and provide services under their existing authorizations or to migrate to the new licensing regime.  In Botswana, for example, existing licensees were permitted to apply for authorizations under the new multi-service authorization regime; however, they were not required to do so. If licensees elected not to apply for a new form of authorization, then these licensees continue to operate under their service-specific authorizations until these authorizations expire.

 

India also gave licensees the option to migrate to the new authorization regime when it introduced the Unified Access Services Licence (UASL) regime”. This is technology- and service-neutral and features automatic authorization subject to notification of the regulator.  The transition to the UASL regime occurred in two phases.  In the first phase, the unified access regime for basic (fixed) and mobile services was implemented.  In the second phase, the UASL regime for all services is implemented.

 

As indicated, existing licensees were given the option to migrate to the UASL.  Operators that elected to continue under the existing licensing regime were subject to the existing terms and conditions of their licences.  Operators that elected to migrate to the new regime would be issued a Unified Access Services Licence (UASL) in the existing service areas, with their existing allocated or contracted spectrum.  No new allocations of spectrum were made in the transition to the UASL regime.  Operators that elected to migrate to the new regime were directed to submit a written request for migration to a UASL, along with the applicable authorization fee and a certified statement agreeing to the terms of the Indian Department of Telecommunications (DOT) guidelines on UASLs. 

 

In February 2004, the Telecommunications Regulatory Commission (TRC) of Jordan announced that it would transition to an Integrated Licensing regime beginning in 2006.  The TRC determined that all existing licensees would be transitioned to the Integrated Licensing regime in 2006.  However, the TRC stated that licensees could migrate to the new licensing regime sooner if they desired.  Existing licensees were not required to pay the standard initial licensing fee upon transition.

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