O2 has been blocked from using its 2G spectrum to deliver 3G services, because certain EU regulations have not yet come into effect in the UK.
Last week, the Competition Tribunal gave its verdict in O2's appeal case against Ofcom, which had turned down an application to let O2 use its GSM spectrum for mobile broadband. O2 had claimed it had an effective right to have its 900MHz and 1800MHz licence altered, because of an EU directive and European Commission decision from 2009. Member states such as the UK were supposed to implement the GSM directive by 9 May this year, to allow the 'refarming' of 2G spectrum.
May this year was taken up with the general election and its aftermath, and the UK's legislative machinery ground to a halt some weeks before the 6 May poll date. However, the Tribunal concluded that the original GSM Directive's wording meant Ofcom was not obligated to implement the EU's new rules before 9 May. O2 lost its appeal.
The EU directive's implementation forms part of the same statutory instrument (SI) that sets out the timetable for next year's 4G auctions and is wending its way through the parliamentary process. According to an Ofcom spokesman, the regulator has conducted a competition assessment — O2 had unsuccessfully claimed this was unnecessary — that has been passed on to the government to inform its decision-making on the matter.