German regulator rebuked over 5G spectrum auction 'bias'
Adds affected companies in paragraph 3, background in paragraphs 5 and 6, plaintiff comment in paragraph 8
FRANKFURT, Aug 27 (Reuters) -A German court found serious errors by the country's federal network regulator during a 2019 auction of 5G mobile radio frequencies and cited concerns over its independence in a ruling on Tuesday.
The administrative court in Cologne said in a statement that the regulator's mobile spectrum auction had been "biased" and "unlawfully influenced" by Germany's ministry for transport and digital infrastructure.
The spectrum would have to be newly allocated, the court said, although it was unclear whether a review would result in a change of rules under which spectrum owners Deutsche Telekom DTEGn.DE, Telefonica TEF.MC and Vodafone VOD.L operate.
Telecommunications industry sources it was unlikely that the entire 6.55 billion euro ($7.32 billion) auction, would be cancelled.
"We do not expect any negative effects on the further rapid expansion of mobile networks in Germany," the regulator said, adding that it would assess the ruling's exact implications.
In the run-up to the 2019 spectrum sale, the regulator known as the Bundesnetzagentur decided it would not force future spectrum owners to sell on some of the mobile data capacity to smaller mobile operators at competitive prices.
The court said the digital infrastructure ministry had weighed in on that question, violating the regulator's independence, which is enshrined in European Union law.
A group of smaller carriers, including Ewe Tel LANDWE.UL, waged a years-long legal campaign against that decision.
"We are not here to freeload. But so far we have not received any offers from the mobile net operators that would allow us to satisfy the needs of our customers," said Ewe Tel managing director Norbert Westfal.
The court did not permit an appeal against its ruling but said that those involved in the proceedings could file a complaint against that decision.
Bundesnetzagentur, now under different leadership, is Germany's central authority for infrastructure. It oversees energy markets as well as telecommunications and other areas.
($1 = 0.8953 euros)
Reporting by Hakan Ersen, Writing by Rachel More and Ludwig Burger, Editing by Alexander Smith
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