The Commerce, Industry & Technology Bureau has rolled out the policy framework for the management of Hong Kong's radio spectrum. It makes clear the policy intention that spectrum trading should be introduced in the long term, subject to a feasibility study on implementation issues.

However, spectrum liberalisation will not be introduced in the short term because its benefits are doubtful in Hong Kong's circumstances.

Greater clarity

Deputy Secretary for Commerce, Industry & Technology Marion Lai said the policy framework will provide the communications industry with greater clarity and predictability of spectrum management decisions, and provide policy guidance for making regulatory decisions.

"The framework will be reviewed and updated from time to time to reflect the latest technological, market and societal developments in Hong Kong and internationally, as well as further deliberations in key issues related to spectrum policy and management," Mrs Lai said.

"To allow time to align the existing spectrum management arrangements with the new policy framework, in the interim, the authority will continue to discharge its spectrum management responsibilities under the Telecommunications Ordinance with a mix of the existing command and control approach and the new market-based approach."

Framework details

The policy framework covers six areas - spectrum policy objectives, guiding principles in spectrum management, spectrum rights, spectrum supply (including spectrum trading and liberalisation), spectrum for government services and spectrum pricing.

Among the spectrum policy objectives, a new objective is to bolster Hong Kong's strategic position as a world city and a global gateway to the Mainland. This is considered particularly important in light of increasing economic integration between Hong Kong and the Mainland.

The framework also sets out clearly the guiding principle in spectrum management that a market-based approach should be used for spectrum when there are likely to be competing demands from providers of non-government services. If there are overriding public policy reasons requiring a departure from this guiding principle, the relevant public policy reasons will be published for transparency.

To provide certainty to spectrum assignees, the framework states that before a spectrum assignment expires, the Telecommunications Authority will normally invoke its powers under the Telecommunications Ordinance to vary or withdraw any spectrum assigned only in exceptional circumstances, including where the public interest or international obligations of the Government so require, there is a serious breach of spectrum assignment conditions or serious interference between legitimate spectrum users has to be resolved or minimised.

The authority may set out minimum notice periods for different types of spectrum assignments. Upon the expiry of a spectrum assignment, if the authority intends to vary that assignment or not to renew it, the authority will, as far as practicable, also give minimum notice periods.

Higher transparency

The authority will publish plans showing the potential supply of spectrum through an open, competitive bidding or tendering process in the following three years to offer more information to the industry on the potential supply of spectrum to the market. Such plans will be updated every year on a rolling basis or as necessary.

While spectrum for government services will continue to be managed administratively, the authority will review the efficiency of the use of those spectrum every three years.

Since spectrum is a scarce public resource, the framework establishes the principle that a spectrum utilisation fee should be applicable to all non-government use of spectrum. Where spectrum is not released through market means, the fee should be set to reflect the opportunity costs of the spectrum. However, if spectrum is assigned to support public interest purposes, the fee may be adjusted accordingly.

To read the policy framework, click here.