In an extraordinary meeting of its board of directors, Brazil’s National Telecommunications Agency (ANATEL) has approved the revised bid tender proposal relating to the 700MHz, 2.3GHz, 3.5GHz and 26GHz frequencies dedicated to 5G.
In the February 1 meeting, ANATEL´s president, Leonardo Euler de Morais, requested that approval of this bid tender be postponed for further examination. Three directors of the agency had already voted in favor of the document. According to ANATEL´s president, the voting is expected to resume as of February 24.
Once approved by ANATEL, the bid tender must be analyzed by the Union Court of Audit – TCU, which will have 150 days to issue its opinion. Notably, this deadline may be accelerated.
ANATEL’s intention is that the bid tender be released in the first semester of 2021.
Below is a brief summary of the voting on the bid tender and the live discussion during the board’s meeting.
(1) Ordinance No. 1.924/SEI-MCOM, of January 29, 2021 (Ordinance MCOM)
The bid tender was affected by Ordinance MCOM, which brought new guidelines to the process, as well as additional obligations and requirements for the participating providers and the infrastructure suppliers, as detailed below.
(2) Federal government´s private network
The bid tender includes an obligation for providers to establish a private communication network for the federal administration – the so-called Secure Network (Rede Segura).
The Secure Network must cover the entire Brazilian territory. Such coverage must be provided through fiber optic cable infrastructure, complementary to the existing government network, and through a mobile network in the Federal District.
The companies supplying the infrastructure for this private network must “observe corporate governance standards compatible with those required in the Brazilian stock market,” pursuant to the bid tender.
The Secure Network´s details, usage and requirements still need to be regulated.
(3) Small providers
In line with the 5G regionalization plan and as a way to incentivize the participation of small/local providers, the 3.5GHz band will also be offered in regional blocks (instead of considering federative states or numbering areas).
Each participant will be allowed to acquire up to two regional blocks.
The 3.5GHz band is considered one of the most relevant ones for the 5G development and covers almost the entire Brazilian territory. Therefore, it will likely be one of the most disputed bands of the bid.
(4) ERB 5G – Release 16 and “stand-alone” network
The providers that acquire the lots of the 3.5GHz band of the bid tender must install, at a minimum, one Radio Base Station (ERB) that allows the offering of personal mobile services by means of technology standard equal or superior to the 5G NR release 16 of 3GPP (5G ERB0, as per the bid tender´s guidelines and schedule.
In practice, this means that such providers will have to adopt a new and independent network from existing mobile networks, which could, initially, be used as a support to the 5G.
(5) Integrated and Sustainable Amazon Program (Programa Amazônia Integrada e Sustentável, PAIS)
The bid tender also introduced the government plan for the establishment of a high-capacity optical system in the Pan-Amazon region and the formation of an “optical belt” linking the Atlantic Ocean to the Pacific (PAIS). The deployment of 5G in the 3.5GHz band within the PAIS area by the providers will be mandatory.
The PAIS is linked to the North Connected Program (Projeto Norte Conectado), which aims to bring high-speed Internet to Brazil´s North region.
(6) Satellite and C band
The bid tender also determined that the providers that acquire 3.5GHz band lots will have to (i) bear the costs for the migration of free-to-air TV signal reception by means of satellite dishes from satellite C band to Ku band (including through the distribution of adequate equipment to the affected persons) and (ii) reimburse Brazilian and foreign satellite operators for the utilization costs related to the 3.625 MHz to 3.700 MHz bands, currently allocated to the Fixed Satellite Service.
About the 5G bid tender
The 5G bid tender will offer, in lots, the 700MHz, 2.3GHz, 3.5GHz and 26GHz bands for the implementation of mobile network fifth-generation technology (5G) in Brazil.
In addition to enhancing general Internet functioning in mobile gadgets, 5G has the potential to enable the modernization of various economic sectors by means of automation, Internet of Things, digitalization and other technologies.
There is an expectation that the 5G bid tender will be the largest bid tender for this spectrum, even though the bid value is still to be defined.
The original 5G bid tender was launched on February 17, 2020, by means of public consultation 9/2020 and since then has undergone extensive discussions and reviews since then. The public consultation is available on ANATEL´s webpage.
Sócia / Partner
Associada / Associate
Auxiliar legal / Legal Auxilary
*Campos Mello Advogados is an independent law firm in cooperation with DLA Piper in Brazil.