Status
Originally planned to take place in July 2021, the 5G auction still does not have a new date set by the Brazil’s Telecommunications Agency (ANATEL). Disagreements between the technical area of the General Accountability Office (TCU), the Federal Government, and ANATEL are currently impacting the Project’s development, according to its original schedule. It is expected that the bid will be published and released in the 2nd semester of 2021, but this is not yet confirmed.
On February 25, 2021, ANATEL’s Board of Commissioners approved the first version of the bid documents of the 5G Project in Brazil, to be sent to the General Accountability Office for technical analysis. For future contracts, ANATEL has defined a scope of obligations for the bid-winners to comply with. The bid is sectioned between the 700 MHz, 2,3 GHz, 3,5 GHz, and 26 GHz frequency bands, divided in national and regional blocks. The main obligations may be summarized as follows:
| 5G Project – Contract’s Main Obligations* |
|---|
| 5G deployment over 26 capital cities and the federal district, until July 2022; |
| 5G deployment over all municipalities with more than 30,000 inhabitants, until 2029; |
| 4G deployment over all places in Brazil with more than 600 inhabitants, until 2028; |
| Development of optical fiber networks (backbone or backhaul) by 2025 (for municipalities with more than 20,000 inhabitants) and by 2026 (for municipalities with less than 20,000 inhabitants); |
| Development of 27,000km (approx.) of optical fiber networks covering Federal Highways and 13,000km (approx.) in the northern region of the country; |
| Designing and developing a private secure network for exclusive use by the Federal Government. |
* Subject to changes after the release of TCU’s technical report
Throughout the 1st semester of 2021, the Brazilian Government organized two missions with a special delegation to visit countries that had already initiated 5G deployment. The Brazilian delegation is headed by the Ministry of Communications. The Justices of the General Accountability Office involved in the analysis of the 5G Project were also part of the delegation. The first mission took place in February and included Sweden, Finland, South Korea, Japan, and China. Private access facilities were visited and practical demonstrations of civil and military applications of 5G technology were carried out, as well as visits to cyber security laboratories. The second mission to the US took place in June, approaching potential investors and understanding how private network models works, with a focus on cyber security matters.
Since 2020, the Federal Government and ANATEL took institutional measures regarding cybersecurity. The current scenario restricts future participation only in the Government’s private secure network – which will have specific and reinforced criteria for carriers and companies. Several normative acts are in force on the topic that also may be addressed in the bid documents.
- FEDERAL DECREE #10,222, FEBRUARY 5, 2020. Approves the National Strategy for Cybersecurity, which defines the main goals to be achieved by the Federal Government regarding cybersecurity, including the ones related to the implementation of 5G technology.
- FEDERAL GOVERNMENT SECURITY OFFICE. NORMATIVE INSTRUCTION #4, MARCH 27, 2020. Defines cybersecurity parameters that must be complied with by all carriers and companies that will operate 5G networks.
- ANATEL’S RESOLUTION #740, DECEMBER 21, 2020. Regulates the Cybersecurity Regulation applied to the Telecommunication Sector, which establishes the main duties and procedures to grant cybersecurity and infrastructure protection.
- MINISTRY OF COMMUNICATIONS. ORDINANCE #1,924, JANUARY 29, 2021. Guidelines for the bid regarding the 700 MHz, 2.3 GHz, 3.5 GHz, and 26 GHz frequency bands. It defines parameters for the protection of users who receive free and open TV signals through satellite dishes (Band C satellite), adjacent to the 3.5 GHz band. The minimum-security requirements for the Government’s private secure network are the following, as provided for in the Ordinance (Article 2, VIII and §10): the private network carrier (i) must comply with specific regulations (to be further issued), and (ii) must use equipment designed, developed, manufactured, or supplied by companies that comply with corporate governance standards compatible with that required in the Brazilian stock market.
Next steps
Analysis of the bid documents by the General Accountability Office (TCU), as provided for in TCU’s Ordinance #81/2018. The analysis conducted by the TCU is technical and considers the cost-benefit of the Project and its impacts to the Public Administration. The TCU has 150 days to conclude its report on the project, counting from the date the case records were received. The initial term was not released by ANATEL but based on public information from the administrative procedure, this date would be March 24, 2021. TCU’s approval may be conditioned to the implementation of several changes on the bid documents which must be observed by ANATEL.
ANATEL’s final version of the bid documents. After the TCU’s report and approval, ANATEL will work on the final version of the bid documents. The Agency will also have to address civil society notes-and-comments on the Public Consultations, as well as other demands presented in the project’s administrative procedure (for example, demands by satellite companies regarding interferences). Part of those claims are already being considered by the Agency and reported to the TCU. The Board of Commissioners will also set a date for the auction, together with the Ministry of Communications and the Federal Government. Political decisions on cybersecurity issues may also affect the next steps of the 5G Project.
For more information, Licks’ team is available at: regobl@lickslegal.com.