Communications policy 1. Policy - Summarise the regulatory framework for the telecoms and media sector. What is the policymaking procedure? In connection with the regulatory framework for the telecoms and media sector in Chile, there are two general laws to take into account, the General Telecommunications Law (the GTL) and the National Television Council Law (the NTCL).  The GTL mainly rules on the following matters:

• its general rules contain a concept of telecommunications, the principle of free and equal access to telecoms, a classification of telecommunications services, a general regulatory framework for the installation, operation and exploitation of such services and rules for the interpretation, application and control of the GTL and its complementary rules;

• telecoms concessions, permits and licences needed to provide telecoms services and the requirements and procedures applicable to their granting;

• tariffication procedures for certain telecoms sevices;

• the fees for the use of spectrum; and

• breaches and sanctions.

The NTCL mainly rules on the following matters:

• duties, attributions and organisation of the National Television Council (the NTC);

• concessions for open television broadcasting services and their granting procedure; and

• sanctions for breaches to the law.

For details on this, please see question 3.

The Ministry of Transport and Telecommunications (the MTT) through the undersecretary of telecommunications, Subtel, is in charge of proposing and developing telecoms policies in Chile, which must then be approved by the president of the republic. Subtel’s policy development procedure is the standard procedure contemplated in the Chilean law for the issuance of any regulation. Telecoms policies, therefore, are materialised by the authority through the issuance

of supreme decrees or exempt resolutions. Although the telecoms authorities are not obliged to do so, they often issue notices of inquiry or notices of proposed rulemaking and consider the opinion of the market players before adopting new policies.

2. Convergence

Has the telecoms-specific regulation been amended to take account of the convergence of telecoms, media and IT? Are there different legal definitions of ‘telecoms’ and ‘media’?

No. There has been no amendment of the GTL specifically addressing this issue. Subtel has disclosed in the media, however, that the Chilean government is analysing the issue and that convergence is a key element of the government’s telecommunications policy.

There are different legal definitions of telecoms and media.

According to the GTL, ‘telecoms’ are any transmission, emission or reception of signs, signals, writs, images, sounds and information of any nature, whether by physical lines, radio electricity, optical means or other electromagnetic systems.

In turn, pursuant to the Law on Freedom of Speech, Information and Journalism, ‘media’ (medios de comunicación social) comprises any means suitable for the transmission, disclosure, spreading or publication in a stable or periodical manner, of texts, sounds or images aimed at the public, without regard of the platform or instrument used in doing so. Therefore, some media players may also be

telecommunications concessionaires or permissionaires (open and cable television channels, radio broadcasting operators, etc).

3. Broadcasting sector

Is broadcasting regulated separately from telecoms? If so, how?

As a general rule, the broadcasting sector is regulated separately from the telecoms sector. In some aspects, however, these markets are subject to a regulatory overlap.

From a technical standpoint, telecoms, radio broadcasting and cable television (CATV) operators are subject to the GTL. For this reason, the MTT, through Subtel, is the entity in charge of granting, renewing and modifying telecoms concessions and CATV permits and supervising that telecoms and CATV operators comply with the

provisions of the GTL. Subtel’s supervisory authorities extend only to technical aspects of the concession and permit holders’ operations and do not include the ability to control or censor the content of their transmissions.

Subtel also manages, pursuant to the GTL, the assignment of the radio-electric spectrum for both the broadcasting (radio and television) and telecoms operators.

In turn, the NTC is in charge of granting, renewing and modifying open television broadcasting services (OTBS) concessions (not cable) and supervising that OTBS concessionaires comply with the provisions of the NTCL. The NTC is also in charge of supervising that the content transmitted by both OTBS and CATV operators complies with the ‘proper performance’ requirements set forth in the NTCL. The NTCL defines proper performance as the permanent respect of the moral and cultural values of the nation, the dignity of persons, the protection of the family, pluralism, democracy, peace, the protection of the environment and spiritual and intellectual education

of children and youth.

The supervisory authorities of the NTC in connection with the content transmitted by OTBS and CATV operators are exercised ex-post. In other words, the NTC may apply sanctions only if it verifies that a violation to the NTCL has been committed, but it has no previous censorship authorities.

Even though there is no entity specifically in charge of supervising the content of radio broadcasting telecoms services (RBTS) transmissions, there are several legal provisions that directly or indiChile rectly regulate the content of all kinds of broadcasting transmissions (including OTBS, CATV and RBTS). These legal provisions include the Criminal Code (especially in cases of slander, libel or defamation),

the Law on Freedom of Speech, Information and Journalism, the Consumers’ Protection Law and the Elections Law.

Telecoms regulation − general

4. WTO Basic Telecommunications Agreement

Has your jurisdiction committed to the WTO Basic Telecommunications Agreement and, if so, with what exceptions?

Chile committed to the WTO Basic Telecommunications Agreement with no exceptions, apart from specifying what is understood in Chile by the term ‘basic telecoms’.

5. Public/private ownership

What proportion of any telecoms operator is owned by the state or

private enterprise?

At present, there is no relevant public ownership in any of the main telecoms operators; one national OTBS concessionaire, Televisión Nacional de Chile, is wholly owned by the state. Although it is not a telecoms operator, one national circulation newspaper, La Nación, is also 100 per cent owned by the state.

6. Foreign ownership

Do foreign ownership restrictions apply to authorisation to provide telecoms services?

Telecoms concessions may be granted only to private or public legal entities duly incorporated and domiciled in Chile. There is no restriction or limitation, however, on the participation or ownership of foreign investors in Chilean telecoms concessionaires, provided their investments comply with Chilean laws and regulations.

Without prejudice to the foregoing, in case of RBTS concessions requested or acquired by entities controlled in more than 10 per cent by foreign investors, such RBTS concessions may be granted to or acquired by the respective entity only if it previously provides evidence that the country of origin of the foreign investors grants

to Chilean citizens the same rights that they will enjoy in Chile (reciprocity).

Likewise, according to Chilean law, the chairperson, managers, administrators, legal representatives and at least the majority of the board members of free radio broadcasting concessionaires must be Chilean citizens. The chairperson, managers, administrators, legal representatives and all the board members of OTBS concessionaires must also be Chilean citizens.

7. Fixed, mobile and satellite services

Comparatively, how are fixed, mobile and satellite services regulated? Under what conditions may public telephone services be provided?

Fixed, mobile and satellite services are generally considered by Chilean telecoms regulations as public, intermediate or limited telecoms services (PTS, ITS or LTS), as the case may be. Therefore, except for the technical rules established specifically for each of them and for the circumstance that, in certain conditions, the tariffs of fixed local telephone services may be set by the authorities, all such services are subject to the general rules contained in the GTL and its ancillary and complementary regulations.

Only holders of a telephony concession may provide publicly available telephone services. In addition, if the telephone is located in a public area, the corresponding operator will have to previously obtain an authorisation from the entity in charge of the respective area (eg, the city hall, the Ministry of Public Works, the Ministry of

National Properties). ITS concessionaires may provide long distance service through public phones located in calling centres available for the general public.

8. Satellite facilities and submarine cables

In addition to the requirements under question 7, do other rules apply to the establishment and operation of satellite earth station facilities and the landing of submarine cables?

Except for certain satellite systems that operate in Chile under international agreements subscribed to by the Chilean state, satellite earth station facilities and submarine cable operators are subject to the same general rules applicable to any Chilean telecoms concessionaire.

9. Universal service obligations and financing

Are there any universal service obligations? How is provision of these services financed?

There are no universal service obligations in Chile. However, universal service is obviously a goal of our telecoms public policies. For example:

• one of the main criterions of assignment in concessions public bids is the coverage offered by the bidders;

• the ‘Digital Strategy for 2007-2012’ is inspired in the achievement of universal service; and

• the Telecoms Development Fund contemplated in the GTL is focused in universal service.

Please see question 33 in connection with the last two bullet points.

10. Operator exclusivity and limits on licence numbers

Are there any services granted exclusively to one operator or for which there are only a limited number of licences? If so, how long do such entitlements last?

In the past, some telecoms operators had exclusivity to provide particular services (eg, fixed telephony and long-distance state monopolies). However, under the current GTL, telecoms concessions and permits are not limited as to their number, type of service or geographical area and, therefore, it is possible to grant two or more concessions or permits for the provision of the same service in the

same location.

A limited number of licences are granted only where technical limitations exist (ie, mobile telephone services, LMDS, WLL, WIMAX and other wireless services), in which case only the number of concessions permitted by the technical regulation of the respective service may be granted for a single service area. In the latter case,

concessions will be granted through a public bidding process.

For details on the duration of licences, please see question 14.

11. Structural or functional separation

Is there a legal basis for requiring structural or functional separation between an operator’s network and service activities? Has structural or functional separation been introduced or is it being contemplated?

There is no legal basis in the GTL for requiring structural separation between an operator’s network and service activities. The structural separation concept has therefore not yet been introduced into our legislation.

Please note, however, that during 2007 there was a notice of proposed rulemaking issued by Subtel in connection with the change of the telecoms licence granting system that contemplated that entities interested in supplying only network services would not require any licence (except when they require to use a portion of the radio-electric spectrum). Such entities, however, would have to previously register

themselves with the network operator and service provider registry.

12. Number portability

Is number portability across networks possible? If so, is it obligatory?

On 10 December 2010, Law N° 20,471 was published, which establishes the number portability right for the users of mobile telephone services as well as for the users of fixed telephone lines.

This law amended the GTL, including a new article “25 bis” which obligates the concessionaries of the public telephone services and the providers of complementary services connected to the public switched telephone network, to implement the number portability system and to comply with the regulations to be issued for the correct operation of the system. This law further establishes that the technical implementation of the number portability shall be performed by a centralised and

unique database, administrated by a Portability Management Body (PMB), entity in charge of providing the inquiries mechanisms for the consultation and administration of the database in a non-discriminatory and efficient way and in such a manner that the operation cost of the number portability system are kept to the minimum.

The financing of the number portability system, has been defined by a special regulation based on a mixed and proportional system which considers the following sources:

• the necessary Investment costs to provide services related with the number portability operation will be financed by the contributions that the public telephone service concessionaries and those concessionaires of the same type shall make according to their participation in the numbering assigned at national level;

and

• the operating costs will be financed based on the portability transactions performed by the subscribers and users.

The law sets forth that those actions which prevent or make difficult the operation or the legitimate exercise of the rights that arise from the number portability incurred by the concessionaires of the public telephone service, by those concessionaries of the same type or by the Portability Management Body shall be punished according to

the VII title of the GTL.

Finally, the number portability law is complemented by two regulations published on 25 March 2011: one of them sets forth the public bidding procedure for the appointment of the PMB and refers to its organisation and operation and to the economic conditions related to the transactions associated to the portability; and the other sets forth the obligations for adequate performance of the telephonic number portability system.

13. Authorisation timescale

Are licences or other authorisations required? How long does the licensing authority take to grant such licences or authorisations?

As a general rule, to provide any telecommunications services, it is necessary to obtain a concession, permit or licence from the telecommunications authority.

Even though procedures for the granting of telecoms concessions, permits and licences are clearly defined in the GTL and its regulations, the duration of such procedures depends on a series of variables that may differ from one specific case to another (particularly when there is opposition from third parties, which sometimes

may need to be resolved by the courts of justice). In standard cases, however, the granting of PTS, ITS or RBTS concessions may take between three and eight months (RBTS concessions are always granted through public bid). The granting of limited telecoms service (LTS) permits (ie, CATV) may take from two to six months. Finally, the granting of OTBS concessions may take from seven to eight months (OTBS concessions are also always granted through a public bid). As already mentioned, third party oppositions may substantially increase the above-mentioned terms. Such

oppositions may be filed by any interested parties that feel that the granting of the concession might damage any of their rights.

14. Licence duration

What is the normal duration of licences?

Telecoms concessions and permits have a legally fixed duration. Under the GTL, PTS and ITS concessions are granted for a 30-year period, renewable for identical periods if requested by the concessionaire. RBTS concessions are granted for a 25-year period, after which the concessionaire will have priority for renewal. Concessions

for the provision of OTBS are also granted for a 25-year period. Permits for the provision of LTS are granted for a 10-year period and may be renewed upon the request of the interested party, with the exception of permits for the provision of limited television services that do not use the radio-electric spectrum (ie, CATV), in which case the duration is indefinite.

15. Fees

What fees are payable for each type of authorisation?

As a general rule, telecoms concessions and permits are granted on a free basis. As mentioned above, telecoms concessions and permits may be subject to auction by the telecoms authorities only in cases when the relevant concessions must be granted through a public bidding process due to the fact that there is a technical rule that allows only a limited number of concessions or permits, and two or more

bidders present equally suitable offers.

The GTL provides, however, that concessionaires, permit holders and holders of telecoms licences that use the radio-electric spectrum are subject to an official fee or duty for the use of the spectrum. This fee is charged on an annual basis according to the Collection Regulations, depending on several factors, such as type of concession,

permit or licence, portion of spectrum granted and service area that has been authorised.

Official fees or duties are charged from 1 January of each year, and must be paid in the second half of the corresponding year. According to the GTL, a payment delay of more than six months is punishable by Subtel with the cancellation of the corresponding concession, permit or licence.

16. Modification and assignment of licence

How may licences be modified? Are licences assignable or able to be

pledged as security for financing purposes?

As a general rule, telecoms concessions and permits may be amended in almost all aspects. However, the following elements of the essence of the concessions may not be amended:

• PTS and ITS concessions: the type of service and the duration of the concession.

• RBTS concessions: the type of service, service area, duration of the concession, the term to start and complete the relevant works related to the concession, the term to start the transmissions, and the power and frequency of the concession transmission.

Additionally, all supreme decrees granting concessions must indicate the above-mentioned essential elements and the following non-essential elements:

• PTS and ITS concessions: the holder of the concession, service area, technical characteristics of the facilities specified in the technical plan corresponding to the type of service, term for the initiation and conclusion of relevant works related to the concession, term for the initiation of the services, location of the radio stations (excluding the mobile and portable ones) and the power, frequency and technical characteristics of the systems.

• RBTS concessions: the holder of the concession, location of the studios, the location of the transmission plant, location and technical characteristics of the system and radio links between the transmission plant and the studios.

The non-essential elements indicated in the last two bullet points above may be amended at the request of the interested party through the issuance of an amendment supreme decree. Applications for the amendment of concessions must be submitted directly to the MTT.

The amendments of PTS and ITS concessions referring to the service area, power, frequency and the technical characteristics of the systems, and amendments to RBTS concessions referring to the location of the transmission plant and the location and technical characteristics of the system, are subject to a procedure similar to that applicable to the granting of the concessions set out in articles 15 and 16 of the GTL; this includes the possibility that third parties may file objections or oppositions to the corresponding concession amendment application. In serious and urgent cases, however, the MTT, through a grounded resolution, may provisionally authorise

the amendment of a concession, regardless of what may be ultimately resolved by the MTT.

The amendment of non-essential concession elements, other than those specified under the last two bullet points above, may be performed after notifying Subtel.

An OTBS concession may be amended in all of its aspects (provided that the relevant amendment is feasible from a technical and practical standpoint). To amend an OTBS concession, the concessionaire must previously file a written application before the NTC. The NTC shall forward a copy of the application to Subtel if the amendment refers to technical aspects of the concession. Subtel (if required) shall review the amendment application and communicate any observation that it may have within 30 days. If Subtel or the NTC have observations, the applicant shall correct them within 15 days. If there are no observations, or such observations were corrected, the

NTC shall resolve the amendment application. Any NTC resolution rejecting the amendment application or affecting the interests of third parties is subject to a procedure similar to that applicable to the granting of OTBS concessions set out in article 27 of the NTC law; this includes the possibility that third parties may file objections or oppositions to the corresponding concession amendment application.

As mentioned above, telecoms and RBTS concessions and permits may be assigned, transferred or leased only with the prior authorisation of Subtel, which cannot refuse such authorisation without reasonable cause. In case of RBTS concessions, however, such authorisation cannot be granted within two years from the date of the legal initiation of the services under the concession. The GTL provides that the assignee of a concession or permit is subject to the same obligations of the former owner. The assignee is bound by the technical and economic project originally submitted by the assignor to Subtel and approved by it. But the assignee may request the amendment

of technical and economic projects at any time. Additionally, as mentioned above, in the case that RBTS concessions requested or acquired by entities that are controlled more than 10 per cent by foreign investors, such RBTS concessions may be granted to or acquired by the respective entity only if it provides evidence that the country

of origin of the foreign investors grants to Chilean citizens the same rights that they will enjoy in Chile (reciprocity). The violation of this requirement leads to the cancellation of the respective concession by the effect of the law.

OTBS concessions may be assigned, transferred or leased only with the prior authorisation of the NTC, which cannot refuse such authorization if the potential assignee or lessee complies with the requirements established in the NTCL to become an OTBS concessionaire.

The pledge of telecoms, RBTS and OTBS concessions and permits is not expressly regulated. But Subtel (using its legal authority to interpret the GTL and its regulations) has expressly declared that no authorisation or approval is necessary to execute a pledge agreement over telecoms or RBTS concessions or permits. However, authorisation from Subtel (in the same terms mentioned above) will

be required in the event of foreclosure of the pledge, and it has to be obtained before the transfer of the pledged telecoms or RBTSconcession or permit to the third party awarded in the auction.

Finally, according to the Law on Freedom of Speech, Information and Journalism, any material change in the ownership of any media entity shall be communicated to the Free Competition Defence Court (the competition court) within 30 days from its occurrence. However, in cases of media subject to concessions granted by the

state (RBTS, OTBS, CATV operators, etc), the relevant change of ownership may be performed only with the previous and favourable opinion of the competition court. Such report shall be issued by the competition court within 30 days from the request of the interested party. Otherwise, it shall be understood that the change of ownership in the relevant media entity does not deserve any kind of objection

from the competition court.

17. Retail tariffs

Are national retail tariffs regulated? If so, which operators’ tariffs are

regulated and how?

As a general rule, the tariffs or fees for the PTS and the ITS may be freely established by the respective service providers. But in the event that the Competition Court resolves that the conditions prevailing in the fixed or long-distance telephone market (excluding the mobile telephone service and the signalling, transmission and switching services provided as ITS or as private circuits) are not sufficient to guarantee free competition, the tariffs or fees of the telecoms services and operators referred to in the Competition Court’s resolution shall be set by the government through a supreme decree. The tariffs shall be set by the government for a five-year period, based on an ‘efficient company’ model. The tariff-setting procedure currently contemplates the participation of third parties, which may express their points of view to Subtel through the procedure contemplated in the relevant regulations.

18. Customer terms and conditions

Must customer terms and conditions be filed with, or approved by, the

regulator or other body? Are customer terms and conditions subject to

specific rules?

No. Subtel is, however, empowered to request any information necessary for the completion of its functions from the telecoms concessionaires, including customer terms and conditions.

19. Next-generation networks

How are next-generation networks (NGN) regulated?

There are no specific regulations on NGN. In this regard, the GTL and its ancillary regulations only rule over the telecommunication services, but not over the networks through which such services are provided. The services may always be rendered if the relevant operator fulfils the applicable technical regulations.

The above-mentioned structure is due to the ‘technological neutrality principle’ that inspires Chilean telecoms legislation, pursuant to which services are provided without regard to the technology used for their provision.

20. Changes to telecoms law

Are any major changes planned to the telecoms laws?

On 11 March, 2010, the new president of Chile, Sebastián Piñera, took office for a period of four years. In the political agenda for his presidential period, the following matters were considered in the field of telecommunications:

• the creation of a Telecommunications Superintendency focused on the supervision of compliance with telecoms regulations and the creation of a National Telecommunications Commission in charge of the regulatory role;

• the creation of an impartial conflict solution system;

• improvement of the licensing system in order to make a better use of spectrum;

• adjustment of regulation for a better use of telecommunications networks and to encourage competition;

• stimulation of interconnection between conventional networks and IP networks;

• implementation of number portability for fixed and mobile telephony; and

• redefining the Telecoms Development Fund in order to bridge the digital gap.

The implementation of these measures have required and will require the implementation of several regulatory initiatives. Included among those initiatives, the GTL has been amended and complemented by four new laws during 2010:

• Law N° 20,453, which sets forth the network neutrality principle. For more information, please see question 32.

• Law N° 20,471, which establishes the number portability right for the users of mobile telephone services as well as for the users of fixed telephone lines. For more information, please see question 12.

• Law N° 20,478, which regulates the recovery and continuity of telecommunications infrastructure that collapsed due to the earthquake which took place in Chile on February, 2010.

• Law N° 20,476, which gradually eliminates the national long distance in Chile.

Finally, the discussion of an important bill that regulates the installation of telecommunications antennae which will probably regulate mandatory co-location of telecoms infrastructure, is pending in the National Congress, and it should be enacted during 2011.

Telecoms regulation – mobile

21. Radio frequency (RF) requirements

For wireless services, are radio frequency (RF) licences required in addition to telecoms services authorisations and are they available on a competitive or non-competitive basis? How are RF licences allocated? Do RF licences restrict the use of the licensed spectrum?

Wireless service concessions generally include the RFs necessary for the provision of the respective service; MVNOs are an exception to this. For more information, please see question 24. Therefore, wireless services concessionaires do not need special RF licences or permits (in addition to their telecoms service concessions or permits)

to provide their services to the public. As such, the GTL establishes an equal and non-discriminatory right of access to telecoms to all the inhabitants of the country. Any person may apply for telecoms concessions, permits and licences according to the terms and conditions of the GTL and its ancillary and complementary regulations.

Telecoms concessions and permits are generally granted to the interested party on a ‘first come, first served’ basis. However, if there is a technical rule that allows only a limited number of concessions or permits of a certain service (eg, mobile telephony and other wireless services), the relevant concessions and permits shall be granted

through a public bidding process. OBTS and RBTS concessions are always granted through public bidding processes.Telecoms concessions and permits are usually granted on a free basis, but may be subject to auction by the telecoms authorities only in cases when the relevant concessions must be granted through a public bidding process due to the fact that there is a technical rule that allows only a

limited number of concessions or permits, and two or more bidders are equally suitable. In cases of RBTS concessions, ties produced between two or more bidders are solved through public draw.

22. Radio spectrum

Is there a regulatory framework for the assignment of unused radio spectrum (refarming)? Do RF licences generally specify the permitted use of the licensed spectrum or can RF licences for some spectrum leave the permitted use unrestricted?

There are no specific regulations on spectrum refarming. Subtel is entitled, however, as legal manager of the Chilean radio-electric spectrum, to take measures and issue regulations aimed at improving efficiency in the use of the spectrum. This occurred, for example, in the 1990s when Subtel established a 12.5KHz canalisation for

the trunking requencies instead of the 25KHz canalisation in force until then. Likewise, in 2005, the MMDS CATV permissionaires that operated in the 2.6GHz band were forced by the authority to migrate to another frequency band. The same situation occurred with certain frequencies that will be used for 3G and digital television services.

Without prejudice to the foregoing, any measure adopted by Subtel in this regard shall respect the rights already acquired by the telecoms operators in connection with their concessions or permits.

The GTL establishes an equal and non-discriminatory right to use spectrum, but always through a telecommunications concession, permit or licence. RF concessions, permits and licences describe the specific service for which they are granted and, therefore, the spectrum is always permitted to be used for specific purposes. For more information on this matter, please see question 21.

23. Spectrum trading

Is licensed RF spectrum tradable?

RFs assigned to a particular operator may not be traded or transferred separately from the concession or permit to which the respective RFs are embedded. Telecommunications concessions (including spectrum or not) may

be transferred, assigned or leased only with the previous authorization of Subtel, which may not be denied without reasonable cause. In the case of RBTS concessions, such authorisation cannot be granted within two years from the date of the legal initiation of the services under the concession.

24. Mobile virtual network operator (MVNO) and national roaming traffic

Are any mobile network operators expressly obliged to carry MVNO or

national roaming traffic?

According to the regulations issued by Subtel, mobile resellers or MVNOs require a PTS concession for mobile telephony and, due to the fact that such concessions are granted without spectrum, they also need access to the infrastructure and spectrum of another concessionaire in order to deliver mobile telephony services. Such access shall be granted by the incumbent operators in accordance with the commercial

agreements that may have been voluntary reached between the concessionaire that has the concession over the spectrum and the corresponding MVNO. In the case of national roaming traffic the situation is similar, the access to the infrastructure and spectrum of another concessionaire in order to deliver mobile telephony services is not compulsory for the incumbent operators, and such accesses are granted by means of voluntarily agreements reached by the relevant parties.

25. Mobile call termination

Does the originating calling party or the receiving party pay for the charges to terminate a call on mobile networks? Is call termination regulated, and, if so, how?

Since 1994, the calling party shall pay for the charges to terminate a call on mobile networks (‘calling party pays’ or CPP system). As mentioned in question 30, the mobile operator’s access charges are fixed every five years by the authorities in accordance with a tariffsetting procedure set out in the GTL.

From a cash flow standpoint, the originating network operator shall pay the access charges to the mobile network operator. In turn, the originating network operator is entitled to request the reimbursement of such charges from the subscriber that made the call.

26. International mobile roaming

Are wholesale and retail charges for international mobile roaming regulated?

No specific regulation has been issued in this regard.

27. Next-generation mobile services

Is there any regulation for the roll-out of 3G, 3.5G or 4G mobile services?

In September 2000, Subtel issued a technical rule reserving the 1,710- 1,770MHz and 2,110-2,170MHz bands for third generation mobile services (3G) to be granted through a public bidding process.

On 27 January 2009, the Supreme Court ruled that no operator may concentrate more than 60MHz in any band assigned for public mobile telephony services as a consequence of the 3G public bid. If any operator receives 3G spectrum and, for such reason exceeds the above-mentioned 60MHz cap, such operator will have to surrender such spectrum either by returning it to the state or through a sale by

public auction.

The general terms and conditions for the public bid were issued by Subtel in April 2009, confirming the spectrum cap fixed by the Supreme Court and regulating the assignment of three spectrum blocks of 30MHz each with national coverage (90MHz overall). Considering that there were already three operators which could not

increase their spectrum due to the cap (Entel had already 60MHz and Movistar and Claro 55MHz each), this became an opportunity for new entrants.

Finally, the public bid took place during 2009 and, after a public auction, Nextel obtained two concessions of 30MHz each and VTR (a subsidiary of Liberty Media) obtained the remaining 30MHz, permitting the entrance of two new competitors into the market of next generation mobile services.

Telecoms regulation – fixed infrastructure

28. Cable networks

Is ownership of cable networks, in particular by telecoms operators, restricted?

There is no specific restriction in Chile regarding the ownership of CATV operators or networks by other telecoms service providers. In fact, the main CATV operator has for a long time offered a triple pack connection (CATV, local telephony and internet access) to the public. Chilean authorities, however, might restrict ownership if, according to antitrust law, it impairs, restricts or eliminates free competition within the relevant market. Any such instances will be analysed on a case-by-case basis.

On March, 2011, the National Antitrust Attorney, presented a request before the Competition Court in order to obtain a General Instruction from them, related to the conditions or requirements which shall be considered by the telecom service providers in the commercialisation of the joint offers or services packs offered to the

public. The outcome of this procedure may establish new obligations for the incumbents’ operators which have a dominant position in the market, aimed at the possibility that the competitors of such companies are able to replicate such joint offers or packs.

29. Local loop

Is there any specific rule regarding access to the local loop or local loop unbundling? What type of local loop is covered?

Unbundled access to the local loop is not currently regulated in a specific manner in the GTL or its ancillary regulations. Subtel, however, has been planning to issue a regulation addressing the unbundling of the local loop in a specific manner.

30. Interconnection and access

How is interconnection regulated? Can the regulator intervene to resolve disputes between operators? Are wholesale (interconnect) prices controlled and, if so, how? Are wholesale access services regulated, and, if so, how?

According to article 25 of the GTL, PTS and ITS concessionaires that render long-distance telephony services, must establish and accept interconnections for the purposes of permitting subscribers and users of PTS of the same type to have communications between themselves, inside or outside the national territory. Such interconnections must be effected according to the technical rules, procedures and

terms established by Subtel.

For these purposes, article 8 of the Public Telephone Regulation states that PTS of the same type are all those services technically compatible among themselves.

The general principle governing interconnection in the GTL is that the new concessionaire pays the costs and expenses necessary to interconnect its network to that of the pre-existing concessionaire.

According to the GTL, violation of the interconnection obligation may be punished by the MTT with fines of up to approximately US$650,000. Each day in which the corresponding concessionaire fails to comply with its interconnection obligation after Subtel’s requirement to do so will be considered a separate violation to the GTL. Additionally, according to the Telecommunication Service Claims Regulation, at the request of an affected party, Subtel is empowered to resolve any claim involving telecoms operators (including claims related to interconnection matters). Subtel’s decisions, however, are challengeable before the courts of justice.

As a separate matter, the fees and tariffs applicable between the concessionaires for services rendered through the interconnection (particularly access charges) shall be fixed every five years by the authorities in accordance with a tariff-setting procedure (based on the cost structure and expansion plans of the respective operator) set out in articles 30 to 30-J of the GTL. From December 2010 the eventual anti-competitive effects of the pricing differentiation that some of the PTS perform, known as the “on-net /off-net” charges, which have direct relation with the access charges fixed by the tariff setting procedure, has been discussed in the Competition Court. The outcome of this procedure may establish additional regulations for the telephony market in this regard by means of a General Instruction issued by the Competition Court.

Telecoms regulation – internet services

31. Internet services

How are internet services, including voice over the internet, regulated?

Internet access services are usually considered as a class of ‘telecoms complementary services’ and, hence, are not specifically regulated.

According to the GTL, PTS concessionaires or any other person or entity, may provide complementary services through public telecoms networks. Such complementary services consist of additional services that are provided through the connection of the equipment of complementary service providers to the public telecoms networks. Equipment should comply with the technical regulations issued by Subtel and should not alter the essential technical characteristics and capabilities of the telecoms networks to which they are connected.

The provision or commercialisation of complementary services does not require any concession or permit nor any contractual or verbal agreement or authorisation from any PTS concessionaire or government authority (including Subtel). Nevertheless, before the start of the complementary services, Subtel must issue a statement certifying that the respective complementary service provider’s equipment complies with the above-mentioned technical regulations. Subtel must issue this statement within 60 working days of its receipt of the interested party’s request; otherwise the corresponding complementary service provider would be authorised to initiate its services by the mere effect of the law.

PTS concessionaires must not perform any act that implies discrimination in favour of any complementary telecoms services provider, or that may cause any alteration to free competition in the market.

In connection with VoIP, in June 2008, Subtel issued a longawaited regulation regarding such service. After a six-month wait, this regulation entered in force on 15 December 2008. The new regulation establishes that a PTS concession is required to provide telephone services over the internet, when the corresponding user has the possibility to make calls to and receive calls from the PTSN. Consequently, communications entirely done over the internet would not require any concession or permit. The same thing occurs with one-way internet-PTSN communications (which do not allow the reception of communications from the PTSN).

32. Internet service provision

Are there limits on an internet service provider’s freedom to control or prioritise the type or source of data that it delivers?

On August 26th, 2010, law N° 20,453 was published. It sets forth the network neutrality principle in the GTL by virtue of which the Internet Service Providers (the ISPs) and those that own and administrate the backbone structure of the internet service, shall not make any discrimination and differentiation among the information that runs through their equipments and/or the network infrastructure.

In order to accomplish the goal of protecting and enforcing the neutrality principle, Law N°20,453 creates several new prohibitions and obligations applicable to the PTS concessionaires and the ISPs, as described below:

The prohibitions are:

• they shall not block, interfere, discriminate, hinder or restrict, in an arbitrary manner, the right of users to use, send, receive or offer any content, application or service provided through the internet, as well as any other kind of activity or authorised use performed through the web (they shall only be permitted to do the foregoing by express request from the user);

• they shall not affect free competition during the performance of traffic management measures and web administration; and

• they shall not limit the user right to incorporate or use any class of equipment, device, or gadget in the web.

The obligations are:

• they shall preserve user’s privacy as well as they shall provide protection against viruses and security services;

• provide parental control services; and

• publish on their web site all the information related to the characteristics of the internet access service offered.

This law was complemented by a special regulation, published on 18th March 2011, which establishes the specific requirements which the ISPs must accomplish in connection with these network neutrality legal obligations.

Reproduced with permission from Law Business Research. This article was first published in Getting the Deal Through - Telecoms and Media 2011 (published in May 2011; contributing editor: Laurent Garzanltl and Natasha Good). For further information please visit www.GettingTheDealThrough.com

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