Court rules:

Rules for 5G auction in Germany unlawful

According to the court, the then German Ministry of Transport had unlawfully influenced the framework conditions of the frequency auction.

(Bild: Ammak - stock.adobe.com)

The Administrative Court of Cologne has ruled that the rules of the game for the multi-billion euro 5G mobile communications auction in Germany in 2019 were not in accordance with the law. The court ruled in favor of the providers Freenet and EWE Tel, who felt they had been disadvantaged by procedural and balancing errors in the award and auction rules.

At the heart of the case was the question of whether the then German Ministry of Transport under the leadership of Andreas Scheuer (CSU) had unlawfully influenced the framework conditions of the frequency auction. At the auction for the 5G mobile communications standard, four telecommunications groups had purchased frequencies for a total of 6.5 billion euros. They committed to minimum expansion targets, such as providing 98% of households in each German federal state with at least 100 Mbit per second download speeds by the end of 2022.

However, the federal government did not impose a so-called service provider obligation. Such a regulation or at least strict requirements would have helped smaller mobile network providers who do not have their own network and rent network capacity. Their position would have been strengthened vis-à-vis the large network operators. Two smaller mobile providers, EWE Tel and Freenet, felt disadvantaged and took the matter to court.

Unlawful exertion of influence by politicians
The Cologne ruling ultimately found that politicians had unlawfully exerted influence on an actually independent authority. This confirmed the accusation of a political deal. This provided for the grid operators to be ordered to meet tough expansion targets, but to be treated leniently when it came to grid leasing.

The legal dispute had previously gone through all instances up to the German Federal Administrative Court. The highest administrative judges in Leipzig referred the case back to the Administrative Court in Cologne in October 2010. The Cologne judges have now ruled that the decision of the Presidential Chamber of the Federal Network Agency on November 26, 2018 regarding the allocation and auction rules for the auction of frequencies in the 2 GHz and 3.6 GHz ranges that are particularly suitable for 5G mobile communications, which took place in 2019, was unlawful.

"Do not expect any negative effects"
It is still unclear how the Cologne ruling will affect mobile customers in Germany, partly because the ruling is not yet legally binding. The Administrative Court has not allowed a further appeal. However, the Federal Network Agency may try to obtain permission to appeal to the Federal Administrative Court. "We do not expect any negative effects on the further rapid expansion of mobile networks in Germany," said an agency spokesperson.