5G regulation and law in Romania

5G deployment has progressed steadily in recent years, with commercial services becoming available in 2019 thanks to the efforts of the Romanian National Authority for Management and Regulation in Communications (ANCOM) in collaboration with industry stakeholders. Once spectrum was reallocated, three major operators were able to launch commercial 5G services in 2019.

In November 2022, ANCOM conducted a highly publicised 5G auction, resulting in the allocation of 420 MHz of spectrum in the 700 MHz, 1500 MHz, 2600 MHz, and 3400-3800 MHz bands.

Currently, 5G network coverage is limited to major urban centres including Bucharest, Cluj-Napoca, Oradea, Iași, Sinaia, Bușteni, Predeal, Timișoara, Craiova, Sibiu, Brașov, Poiana Brașov, Constanța and Mamaia. However, with the recent allocation of additional spectrum, we anticipate a wider roll-out of 5G services in the near future.

Telecom companies are currently offering special 5G-compatible subscription plans.

One major telecom operator has introduced a specialised 5G corporate subscription plan, specifically for fixed-point 5G Wi-Fi solutions (note that the term "5G" refers to 5G mobile communications services and not a 5 GHz Wi-Fi router). 

This B2B subscription plan grants unlimited access to speeds of up to 1.2 Gbps within the 5G coverage area (which is currently limited to a few cities). Where 5G isn't available, the router will connect to the 4G network instead (up to 355.6 Mbps).

This subscription plan is for companies that lack access to fibre optic infrastructure or require high-speed internet back-up solutions. 

To ensure a broad range of operators and industrial companies, both small and large, have access to frequencies, ANCOM has set coverage requirements for the winners. These requirements mandate, inter alia, that the operators must provide broadband services to at least 70% of the  population, especially in urban areas, highways, international airports and modernised railways, as well as 240 localities currently not covered or poorly covered by mobile services.  Currently, the 5G network is primarily available in major cities, however, efforts are being made to expand coverage to other areas as well. It is expected that operators are already working on providing the 5G network to stadiums, airports, and other special premises.

On 19 September 2022, ANCOM launched an auction to grant licences for frequencies in the 700 MHz, 1500 MHz, 2600 MHz and 3400-3800 MHz bandws (also widely known as the “5G tender”). 

In 2021 a smaller tender awarded licences for the 800MHz, 2600MHz and 3400MHz-3600MHz bands. Since both 2021 and 2022 tenders contained similar criteria, we will refer below to the 2022 tender. 

NCOM set up a competitive selection procedure, broadly similar to previous processes, which asked interested operators to submit an initial offer indicating the number of blocks they wished to purchase, and at which price. The tender provided for subsequent competitive rounds depending on the bidding scenario and the extent to which further rounds were necessary (until the spectrum could be awarded). 

As an example, in the first primary round, the price for each spectrum category would be equal to the reserve price (minimum licence fee) for that category. In the next primary round, for any in-demand blocks, the tender commission would set prices above the reserve prices by a certain percentage (bid increment). The same price setting rules would apply to any subsequent primary rounds. This means that whenever demand outstrips supply, the price for that category would be higher in the next round. When demand does not surpass supply, the price remains the same in subsequent rounds.

To participate in the auction, the interested persons must submit an application to ANCOM and buy the Terms of Reference. This must demonstrate how the candidate would meet budgets and whether turnover reached at least EUR 10m in the previous year or had a subscribed and paid-in share capital as the RON equivalent of at least EUR 1m, that it was not in a state of insolvency or liquidation, its business was not handled by a bankruptcy judge, its commercial activity was not suspended, it was not part of another applicant’s group, etc. The file must also contain the participation bond and the initial bid, which should indicate the number of blocks the applicant wishes to acquire in each available block.

The terms of reference said that licence holders must ensure the effective, rational, and efficient use of the radio frequencies and avoid harmful interferences. Specific obligations included: 

1. Coverage, which differ depending on the frequency usage rights in the applicable MHz band, whether the holder would be a new entrant or an established market player, and the type of mobile communication services;
2. Deployment obligations (e.g., the winners  in the 3400-3800 MHz band, must deploy 2,200 base stations enabling a speed of at least 100 Mbit/s/20 MHz, installed domestically, with the number differing for each referenced city); 
3. Service quality, for example the minimum network availability standard; 
4. Compliance with certain technical and operational requirements. 

Three operators were selected as follows:

1. A first operator acquired two blocks of 2x5 MHz in the 700 MHz FDD band, all eight blocks of 5 MHz available in the 1500 MHz band and 16 blocks of 10 MHz in the 3400-3800 MHz band, for EUR 264,607,669.
2. A second operator won one block of 2x5 MHz in the 700 MHz band FDD and 10 blocks of 10 MHz in the 3400-3800 MHz band for EUR 122,503,374.
3. A third operator won the four blocks of 2x5 MHz in the 2600 MHz FDD band and five blocks of 10 MHz in the 3400-3800 MHz band, for EUR 45,500,000.

The licence fees, totalling EUR 432,611,043 must be paid in instalments, with the first due on 8 December  2022, totalling (EUR 119m), and the last on 17 November 2028  (EUR 80,009,617).

In the 700 MHz and 1500 MHz bands, the licences are valid for 25 years from 1 January 2023, while in the 3400-3800 MHz band the period is 22 years, from 1 January 2026. In the 2600 MHz band, the licences are valid from 1 January 2023 to 5 April 2029.

Operators must provide broadband services to at least 70% of the population, most urban areas, highways, international airports and modernised railways, and mobile services to 240 settlements that are currently not covered or poorly covered.

ANCOM awarded licences that will begin in 2023 and 2026 respectively, with respective validity of 25 years and 22 years. Licences in the 2600 MHz band, however, will last six years and three months, in order to align with the other existing licences.

The total reserve price established by Government Decision no. 1139/2022 was EUR 693m. These prices were determined based on national and European benchmarks, the physical properties of the bands, existing rights in those bands, as well as the duration and usage conditions. The band value was set at: EUR 372m for the 700 Mhz band, EUR 48m for the 1500 Mhz band, EUR 13m for the 2600 Mhz band, and EUR 260m for the 3400-3800 Mhz band.  

A reserve price (equal to the minimum licence fee for each block) was set for each block, plus eligibility points, which acted as a “bargaining chip” for rights to the respective blocks. Bidders could “acquire” eligibility points, which corresponded to a maximum amount of abstract (non-individualised) frequency blocks, in any band.

The fee would be paid in instalments during the first years of the licence.

According to the tender, the spectrum usage tariff for broadband wireless services was significantly reduced in the 1800 MHz, 2100 MHz and 2600 MHz bands. The new spectrum usage tariff in the 3400-3800 MHz band intended to reflect its value as a pioneer band for next-generation broadband wireless services.

The spectrum usage tariff was 30% lower in the 700 MHz, 800 MHz, 900 MHz and 3400-3800 MHz frequency bands, in order to reach medium and long-term national connectivity targets. 

ANCOM has announced that 5G licences in the 700 MHz and 1500 MHz bands will last 25 years, commencing 1 January  2023. Licences in the 3400-3800 MHz band will last 22 years, starting 1 January 2026. In the 2600 MHz band, the licences last from 1 January 2023 to 5 April 2029. The Authority has not announced any new tenders or long-term spectrum plan yet.

Law no. 163/2021 (known as the “5G Law”) provides mandatory obligations for 5G infrastructure and equipment providers, which must:

1. not be under the control of a foreign government that lacks an independent legal system; 
2. have a transparent shareholding structure; 
3. not have a history of unethical corporate conduct; 
4. be subject to a legal system that enforces transparent corporate practices.

According to the 5G Law, this applies to all manufacturers/providers of technology, equipment and software used in information and communication infrastructure with a national interest or in electronic communications networks through which 5G services are provided.

Applicants must file the request with the Ministry of Transport, Infrastructure and Communications (MTIC), which will forward it to CSAT. The Prime Minister will grant authorisation on the recommendation of CSAT, which will issue an opinion within a maximum of four months from the filing of a request.

Each applicant must submit information on its shareholding structure and corporate group, including detailed information on any parent company. Also, the applicant must file a statement on its liability, affirming that it is not under the control of a foreign government lacking an independent legal system.

CSAT will assess the risks, threats and vulnerabilities to national security and defence that an applicant's technology could present; the law explicitly enables CSAT to consider Romania's obligations under international cooperation and any bilateral strategic partnerships and we note that one such bilateral strategic partnership is Romania's 20 August 2020 Memorandum on 5G with the US.

Providers must only use 5G technologies, equipment and software from authorised manufacturers/providers, proving this to ANCOM.

If a company’s authorisation is withdrawn, it would still be able to continue using the equipment for another seven years (for networks) and five years (for the core elements).

Failing to meet this condition can result in fines of between 1% and 5% of turnover. The same fine will apply to existing manufacturers/providers that fail to obtain authorisation after the expiry of the five–year grace period.

Finally, providers that fail to provide information requested by ANCOM may be fined between 3% and 10% of turnover from the year before. Any operator fined would also be forbidden from using non-authorised technology.

According to the 5G tender conditions, operators may only use infrastructure/equipment provided by an authorised provider.

To date, there have not been any reported issues in the implementation of 5G projects, although the auctions only took place in November 2022. ANCOM has not announced any decisions regarding non-compliance with 5G concession obligations.

At present, there are no specific regulations in place regarding the sharing of 5G networks or spectrum. ANCOM has not yet taken an official stance on shared 5G infrastructure ownership or use. 

ANCOM has not issued any official information on the topic of 5G shared infrastructure.

We have not identified special rules for granting competitors access to new 5G networks once they are deployed.

In August 2019, Romania and the US signed a memorandum of understanding to establish transparency criteria for 5G network providers. 

In September 2019, the former US Ambassador to the European Union praised Romania for not using Chinese technology in its 5G networks. 

In January 2020, the US Embassy in Romania issued a statement emphasising that companies connected to an authoritarian government like China could not be trusted. 

In November 2020, the former Prime Minister officially stated that Romania would not partner with China on 5G. 

In June 2021, Romania passed the 5G Law, which requires 5G producers to obtain prior authorisation from the government. To date, no Chinese companies have been authorised. 

During the same month, the Chinese Embassy issued a statement opposing the exclusion of any country or enterprise from the market and emphasising the good safety record and contributions of Chinese telecommunications companies in Romania. 

In May 2022, US Republican Senator Robert Portman expressed satisfaction that Romania does not have Chinese companies involved in its telecommunications networks.