Claro and Movistar to give network back to Government of Colombia

Juan Fernandez Gonzalez | 28-08-2013

After investing over $3,600 million during a 20-year concession, Movistar and Claro have been ordered to give Colombia's mobile infrastructure back to the State.

Since 1994, the two operators have been working with the networks inherited from the former public monopoly, but the concession ends next year.

Colombia's Constitutional Court has ruled that the two operators are obliged by law to give the whole infrastructure back, whereas Movistar and Claro had believed that only the radioelectric spectrum slots needed to be returned and that they would retain the physical network.

The court's decision is based on the possible dominant position of the companies if they kept the networks, putting at risk the equality of conditions for potential operators. For its part, the Government gets a modernised network, in which both companies have invested €3,648 over 20 years. According to a statement from José Otero, Signals Telecom Group president, in the local newspaper El Espectador, the Government will be able to set the price and conditions for future concessions, leaving Movistar and Claro without much operational space.

The industry was aware of this possibility, however Tigo and Une aren't affected by the court's decision, as both signed their concessions later and under new rules.

The slots for the 4G network have already been tendered, with Movistar and Claro participating, and these won't be affected by the ruling either.