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How to apply

How do I apply for a trade?

To apply for a trade licence holders should complete the Application for Spectrum Trading form (Ofw206) and send it to the Spectrum Trading Desk at the address indicated on the form. The application form comes with detailed guidance on how it should be completed.

What are the basic steps in the transfer process?

Companies that currently hold WT Act licences will be allowed to transfer their rights and obligations under those WT Act licences to other companies. Companies will be free to negotiate the form of the commercial arrangements underlying the transfers between themselves.

The basic steps in the transfer process are as follows:

• Licence holder submits Ofcom’s application form (which includes a statement of consent) signed by the transferee and transferor;
• Ofcom assesses the information provided on the form and considers whether it requires further information from the parties in order to be able to consent to the transfer;
• Ofcom publishes a notice setting out basic details of the proposed transfer on the trade notification register;
• Ofcom checks that none of the circumstances in which transfers are not authorised apply;
• Ofcom considers and determines whether or not to consent to the trade and if it consents whether or not to issue a direction requiring matters to be done before the transfer is put into effect;
• Ofcom informs the parties to the transfer of its decision about consent and directions; and
• The parties and Ofcom put the transfer into effect by the licence holder surrendering the original copy of his licence to Ofcom and Ofcom issuing new licences.

Regulations 8, 9 and 10 of the Trading Regulations set out the transfer procedure.

Please note that more detailed information on the transfer process is available with the trading application form, available on the trading & liberalisation page at [provide link].

The Trading Regulations – Wireless telegraphy (Spectrum Trading) Regulations December 2004
http://www.ofcom.org.uk/radiocomms/ifi/trading/legislation/

What information do I need to submit to Ofcom?

Once the commercial details of a transaction have been agreed between the parties, the licence holder must submit a ‘Trading Application Form’ to Ofcom’s Spectrum Trading Desk. Overall, parties to a transfer need to provide Ofcom with all the information required for Ofcom to decide whether or not to consent to a trade. This form requests basic information such as details about the parties involved in the transfer, reference number of the licence to be transferred, a statement on which type of transfer is requested and on the rights of use the transferor (the licence holder) has agreed to transfer to the transferee (the potential new licence holder). All parties involved in the proposed transfer need to sign to confirm they have agreed to the transfer. In addition, parties to a transfer need to provide Ofcom will all the information required for Ofcom to decide whether or not to consent to a trade.

Regulation 8(1) of the Spectrum Trading Regulations sets out the information that must be provided by the companies that wish to trade.

The Trading Regulations – Wireless telegraphy (Spectrum Trading) Regulations December 2004
http://www.ofcom.org.uk/radiocomms/ifi/trading/legislation/

Trading application form.
Please see 'Related Items'.

Why is Ofcom also asking for voluntary information?

Ofcom will also request additional information on a voluntary basis, which may be useful to Ofcom in order to monitor the success of spectrum trading. Such voluntary information might include details of the underlying commercial transaction, including information on the price attributable to the transfer of rights and obligations under the licence. Ofcom will keep confidential all such information.

What Ofcom will do

What will happen after I have submitted all this information?

Once all the information is provided, Ofcom will check the documentation in order to ensure that the mandatory information requirements have been met and that the proposed transfer is consistent with the information held by Ofcom. Parties who give false information will be in breach of the Trading Regulations and any resultant transfer, even if completed by Ofcom, would be void. Ofcom may request further information to decide whether to consent to a transfer or not. Ofcom will acknowledge receipt of the application in writing.

Ofcom will also check that none of the circumstances in which transfers are not authorised apply.

Under what circumstances are transfers not authorised?

There are some particular circumstances under which transfers are not authorised – even if a licence holder has a licence in a tradable licence class. These are:

• Where any or all of the (concurrent) licence holder(s) and the transferee have not consented to the transfer. All of the parties must consent to the transfer. Ofcom will require the parties to a trade to provide Ofcom with a document which provides evidence of that consent.
• Where licence fees are outstanding. Where the licence holder has opted to pay its licence fee in instalments, he should contact Ofcom and consider paying up its outstanding instalments.
• Where Ofcom has served notice of a proposal to revoke a licence (under section 1E of the WT Act 1949). (see ‘Due diligence’ section 6)
• During the short period between a licensee requesting a licence revocation or variation (or consenting to a variation or revocation proposed by Ofcom) and the revocation or variation being implemented.
• Where Ofcom has not consented to a transfer being made. (see ‘Reasons for not allowing a trade’, question 29 below)

Regulation 7 of the Spectrum Trading Regulations sets out particular circumstances in which transfers are not authorised.

The Trading Regulations – Wireless telegraphy (Spectrum Trading) Regulations December 2004
http://www.ofcom.org.uk/radiocomms/ifi/trading/legislation/

When will Ofcom publish a notice about the proposed trade?

After these checks, Ofcom will publish a notice on the Trade Notification Register ( TNR ), stating the names of the transferor and the transferee and setting out basic information about the licence to be transferred. The status of the transfer on the TNR will initially show ‘being processed’ until Ofcom has consented to the trade when the status will be updated to show “Consent granted” followed by “Completed” once the trade has been effected. Where Ofcom does not consent to a trade or where either party to the transfer decide not to continue the trade, the status will show “Transfer not completed”.

Regulation 8(2) of the Spectrum Trading Regulations lists the information Ofcom will publish in its notice – after determining the information requirements are met.

Trade Notification Register (TNR).
Please see 'Related Items'.

The Trading Regulations – Wireless telegraphy (Spectrum Trading) Regulations December 2004
http://www.ofcom.org.uk/radiocomms/ifi/trading/legislation/

Reasons for not allowing a trade

What reasons may Ofcom have to not consent to a proposed trade?

A transfer of a licence is subject to Ofcom’s consent. These reasons are set out in the Trading Regulations. In determining whether or not to consent to a proposed transfer Ofcom shall take into account whether –

• the holder is, or the concurrent holders are, in breach of the terms of the wireless telegraphy licence under which the rights and obligations are to be transferred;
• the transferee is able to meet the terms, provisions and limitations of the wireless telegraphy licence which is to be granted as a result of the transfer;
• in the case of a transfer authorised by regulation 6 the transferor is able to meet the terms, provisions and limitations of the wireless telegraphy licence which is to be granted as a result of the transfer;
• the transferee is able to meet any criteria relating to the persons to whom a wireless telegraphy licence of the class under which rights and obligations are to be transferred may be granted; and
• it is requisite or expedient to refuse consent to the transfer –
• in the interests of national security;
• for the purposes of complying with a Community obligation of the United Kingdom or with any international agreement or arrangements to which the United Kingdom is party; or
• for the purposes of complying with a direction by the Secretary of State given to OFCOM under section 5 or section 156 of the Communications Act 2003.

Regulation 9 of the Spectrum Trading Regulations sets out the information Ofcom takes into account when determining whether or not to consent to a proposed transfer.

A Statement on Spectrum Trading ( 6 August 2004 ) – Section 3
Please see 'Related Items'

The Trading Regulations – Wireless telegraphy (Spectrum Trading) Regulations December 2004 http://www.ofcom.org.uk/radiocomms/ifi/trading/legislation/

Would Ofcom consent to a transfer subject to the resolution of consent matters?

Ofcom anticipates that in some circumstances it may be able to consent to a transfer, but give a direction to the parties to the trade that the transfer will only be put into effect when certain of the consent matters (from regulation 9) are resolved.

Regulation 10 of the Spectrum Trading Regulations enables direction by Ofcom for a transfer.

A Statement on Spectrum Trading ( 6 August 2004 ) – Section 3
Please see 'Related Items'.

The Trading Regulations – Wireless telegraphy (Spectrum Trading) Regulations December 2004
http://www.ofcom.org.uk/radiocomms/ifi/trading/legislation/

What happens after Ofcom has completed all checks?

If satisfied that the parties comply with all requirements for a trade and that Ofcom should consent to the transfer, Ofcom will contact the parties to the trade and provide them with a decision on consent and whether any directions are to be imposed.

In order to affect a transfer, the transferor’s licence will need to be surrendered. In the case of a total transfer, Ofcom will then grant a new licence on exactly the same terms and conditions to the transferee. In the case of a partial transfer Ofcom will grant new licences with the appropriate terms and conditions to both the transferor and the transferee. In the case of a “concurrent” transfer Ofcom will grant copies of the same licence to both the transferor and the transferee (i.e. the new concurrent holders).

If, on the other hand, Ofcom decides not to consent to a proposed transfer, we will communicate this decision and the reasons, to the parties involved. In this communication, Ofcom will make clear the grounds on which it has withheld consent. In certain cases it may be possible for the licensee to modify its plans, if they so desire, and make an alternative application if appropriate. Note that in such circumstances the reasons why consent has not been given will NOT be recorded on the Trade Notification Register ( TNR , see section 5). Instead, this register will simply record that the trade was not completed.

Regulation 8(4) of the Spectrum Trading Regulations requires Ofcom to notify the parties of the transfer, and regulation 8(5) sets out how the trade will be affected.

A Statement on Spectrum Trading ( 6 August 2004 ) – Section 3
Please see 'Related Items'.

The Trading Regulations – Wireless telegraphy (Spectrum Trading) Regulations December 2004
http://www.ofcom.org.uk/radiocomms/ifi/trading/legislation/

Will Ofcom charge a fee for this transfer process?

For the first year of trading at least, no fee will be charged by Ofcom for processing transfers.

However, Ofcom intends to keep this position open for review in future years, by which time we will know more about the take up of trading and the associated resource demands on Ofcom. Any proposal to introduce fees for trading would be subject to further consultation and would be based on cost-recovery principles.

A Statement on Spectrum Trading ( 6 August 2004 ) – Section 3.
Please see 'Related Items'.

What happens with the licence fees when the rights are transferred?

A licence transfer should not trigger the payment to Ofcom of additional licence fees nor the repayment to a transferor of any fees already paid. The rights transferred under a licence will include the transferor’s rights which arise from having paid a licence fee.

The renewal time when further licence payments may be due (under the licence charges regulations) will remain the same, notwithstanding the transfer, and will be set out on the licence as issued to the transferee.

Ofcom will ensure that all licence fees which are owed have been paid in full before a transfer can take place. This will leave the parties free to take account of licence fees which have already been paid by the transferor when agreeing the price to be paid in relation to the transfer.

A Statement on Spectrum Trading ( 6 August 2004 ) – Section 3.
Please see 'Related Items'.

What happens to my old licence?

In order to affect a transfer, the transferor’s licence will need to be surrendered. In the case of a total transfer, Ofcom will then grant a new licence on exactly the same terms and conditions to the transferee. In the case of a partial transfer Ofcom will grant new licences with the appropriate terms and conditions to both the transferor and the transferee. In the case of a “concurrent” transfer Ofcom will grant copies of the same licence to both the transferor and the transferee (i.e. the new concurrent holders).

What about tax?

Trading activities, like all business activities, may give rise to income and gains which will be subject to tax in the normal way. This includes income tax, corporation tax, value added tax and other taxes as appropriate.

Trading parties who have tax-related queries are advised to refer them to the Inland Revenue or Customs and Excise or to seek their own professional advice.

A Statement on Spectrum Trading ( 6 August 2004 ) – Section 3.
Please see 'Related Items'.

How long will it take

How long does it take Ofcom to give consent to a proposed trade?

Ofcom has not set rigid guidelines in trading regulations regarding the time it takes to complete the transfer process as it does not believe these are appropriate since we consider the priority is to make objectively justifiable decisions. Ofcom recognises, however, that it is important to the success of trading that it makes timely decisions. Consequently, Ofcom intends to apply the same processing targets for completing all trading applications as it does for processing more complex licence applications (Ofcom refer to this type of application as Category B). Thus, Ofcom hopes to complete all trades (measured from the day the proposed transfer is received by the Trading Desk, to the day the transfer is effected or rejected) within 42 calendar days.

We will review this timing shortly after the launch of trading to investigate if we can reduce it, but at this stage our priority is to provide certainty and clarity over processing times.

Can I schedule trades?

Ofcom will liaise with all parties throughout the trading process as appropriate and this will include scheduling a date for the trade to be put into effect. It is possible, however, to request a particular date you wish a trade to become effective. This facility may be useful when setting up contracts relating to a trade. To do this, simply enter the required date in the appropriate box on the trading application form. Please note that the date specified should be a working day and give Ofcom reasonable time to properly process your application. The date must be later than 42 calendar days after application and before the expiry of 3 months after application.

Clearly, Ofcom cannot guarantee meeting any such date since timing will depend on the issues that arise on any particular transfer application. However, Ofcom will take the parties desired date into account. If the exact date when a transfer is to be put into effect is of significance to parties, Ofcom recommends that they liaise with the Spectrum Trading Desk.

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