The National Communications Commission (hereinafter, the “NCC”) amended the Regulations Governing the Mobile Broadband Business on September 6, 2019. In particular, bidding-based 5G licensing will still be conducted by two-stage competitive bidding. Meanwhile, telecommunications operators applying for 5G operation, preparation and installation permits are also required to submit relevant information and communications technology security documents.
According to the NCC, a total bandwidth of 2790MHz will be released this time. In particular, the 3.5GHz and 28GHz bands are both frequently used bands in the 5G services rolled out in various countries. In addition, the development of relevant base stations and terminal equipment is also relatively more mature and stable. Under Article 21-1 of the Regulations Governing the Mobile Broadband Business, bidding-based 5G licensing will be conducted via two-stage competitive bidding. In particular, multiple rounds of competitive bidding in the first stage will be conducted to determine the quantity of the bandwidth to be licensed, while the second stage will involve competitive bidding over locations to determine the locations of the frequencies to be licensed. In addition, supplemental rounds of competitive bidding are designed in these amendments to ensure the smooth release of the frequencies as previously planned.
According to the NCC, to promote fair competition and prevent spectrum resources from be monopolized by a few operators, Article 18, Paragraph 1 of the Regulations Governing the Mobile Broadband Business is formulated to provide that the maximum bandwidth each bidder may be licensed for each band is 100MHz for the 3.5GHz band and 800MHz for the 28GHz band. To further realize the information and communications technology risk control mechanisms of operators, telecommunications operators are required under the amendments to submit relevant information and communications technology security documents when applying for the 5G operation, preparation and installation permits.
The NCC further pointed out that to ensure proactive construction of the 5G network by bid winners, Article 66 of the Regulations Governing the Mobile Broadband Business specifically provides for the minimum construction obligation for 5G base stations. To be specific, bid winners for the 3.5GHz band are required to construct 5G base stations using the 3.5GHz bands licensed to them in five years or to upgrade their previous 4G frequency bands to set up 5G base stations with a coverage of at least 50% of the national population. In addition, the 3.5GHz band awarded shall be used by at least 1000 5G base stations to be constructed. With respect to bid winners for the 28GHz band, the only requirement is that the number of base stations to be constructed should be based on the licensed bandwidth for each band, and a minimum of 357 5G base stations and a maximum of 3,000 5G stations should be constructed by an operator awarded with a 100MHz bandwidth.