MNOs could now get back as much as £220m after the ruling.
Background: UK mobile operators pay Annual Licence Fees (ALFs) to the regulator Ofcom for their use of spectrum in the 900MHz and 1800MHz bands. Between 2015 and 2017, Ofcom significantly raised the amount of the ALFs – about four times as much as previously following a decision to liberalise the bands for new uses (i.e. 4G technology). This led MNOs to legally challenge Ofcom’s decision: EE won a challenge in 2017, when a court ruled that Ofcom should not have raised ALFs without an impact assessment. Subsequently, Vodafone led another legal action to recoup what was overpaid during that period.
The High Court ruling: Last week, the High Court ruled in favour of Vodafone, according to reports from the Financial Times. The decision to quadruple the ALFs was deemed illegal; this now opens the door for UK operators to get a rebate on what they overpaid during the relevant period – as much as £220m. BT/EE would most benefit from such rebate, as it holds the largest share of spectrum, whereas Three would receive the smallest share. Vodafone and O2 would share a total of about £110m.
It may not be over yet: The Court has granted Ofcom the right to appeal the decision; the regulator looks set to do so, as it noted that the case “has been decided on what is a technical and important point of law”, and that mobile operators “did not challenge the amount they pay for this valuable spectrum”.
