Ofcom Repay £218m to UK Mobile Operators for Overcharging

Ofcom has lost its appeal against last year’s ruling by the UK High Court of Justice (here), which ordered them to repay £218m to mobile operators as part of restitution for their handling of a licence fee hike to the 900MHz and 1800MHz spectrum bands (i.e. £82.4m to EE, £54m for Vodafone, £54m for O2 and £26m for Three UK).

As a quick recap. The situation began in December 2010, after the then coalition Government directed Ofcom to revise fees for mobile spectrum in the 900MHz and 1800MHz bands in order to reflect the “full market value” of those frequencies, as well as other statutory duties. Several years later the regulator duly proposed a huge hike in licence fees (here) and so began a long running legal battle.

The original matter was largely resolved (here), although it left a question mark over the issue of how much money should be paid back to the operators for fees taken (i.e. the difference between how much operators would have paid under the original 2011 model and how much they did pay under a flawed 2015 revision). The full ruling goes into much more detail but can be summarised fairly simply.

Court Judgement

I would, therefore, hold that the judge was right to decide that the MNOs were entitled to restitution of the ALFs [license fees] paid over and above those that were due under the 2011 Regulations.

Finally, I would like to pay tribute to the judge’s formidable exposition of the law in this area. Whilst I have disagreed with some of the detail of his reasoning, probably because of the further development of the arguments before us, his concise and accurate exposition has been invaluable to this court.

I would dismiss this appeal.

Ofcom could of course take their appeal to the Supreme Court, although they haven’t yet announced whether such action will be taken (by now it looks a little bit like a lost cause). In the meantime Vodafone has pledged to invest the returned fee into improving their national network. Hopefully this is the last time we need to report on this long running case.