Creation and modification of spectrum licenses for FM broadcasting

- in the period leading up to 2 April 2011

The frequency transition process involved in the renewal of some AM and FM licences suitable for sound broadcasting is intended to remove historic anomalies and thereby enhanced opportunities for improved and new services.

Licences in the current Management Right (MR 261) used for VHF-FM sound broadcasting expire on 2 April 2011. At that time new licences in Management Right 207 (MR 207) will come into force. Note that MR 261 has recently been created by the aggregation of MR 260 (88.4 MHz to 88.8 MHz) and MR 143 (88.8 MHz to 106.63 MHz).

These policies are valid until 2 April 2011. At that time MR 261 will expire along with the need for the policies.

These policies are in addition to other current policies and do not replace or modify existing policies relating to the granting, modification or cancellation of spectrum licences for FM broadcasting use.

1. Modification of Spectrum Licences for FM broadcasting

The licences in MR207 are currently in the name of the Crown pending settlement of renewal contracts (or other procedures for licences allocated non-commercially) by 3 October 2010, unless an early purchase has been implemented.

Rightholders of licences in MR 261 periodically wish to modify the parameters of their licences. Such modifications require:
 

1. certification of technical compatibility under the Radiocommunications Act; and
2. payment of any increased value accruing through the modification (if applicable).

The Ministry approves such modifications when these parameters, and other policy requirements, are met. The licence instruments are then recorded on the Register of Radio Frequencies.

The rightholder of a spectrum licence in MR 261 generally prefers any modified parameters to also be applicable after April 2011. Accordingly, the corresponding licence in MR 207 also requires modification. Additionally, this affects transition licences where a frequency change is required prior to expiry of MR 261.

Rightholders who seek to modify their spectrum licences in MR 261 are responsible for ensuring that the changes they seek can also be implemented for the replacement spectrum licence in MR 207 and also for any associated transition licences.
Applications for a proposed modification to a spectrum licence in MR 261 are to be accompanied by written advice from the rightholder, or their agent, that the modifications have also been fully assessed in relation to the associated MR 207 licence and any transition licence.

The Ministry will require:

1. technical certification of the modifications to MR261 licence(s) in the normal way; and
2. appropriate arrangements for payment of any increased value of the MR 261 licence.

If the associated MR 207 licence is still in the name of the Crown, the Ministry also will require confirmation:

1. that the modifications in MR 207 are practicable, by provision of draft instruments and certification; and
2. that the rightholder agrees (in writing) to pay the increased value of the MR 207 licence(s) based on current valuation policies and the population change assessed for the MR 261 licence (where appropriate);
    

The Ministry will not process the proposed changes to MR 207 licences until after the completion of the purchase and licence transfer arrangements in October 2010. At that time the technical certification will still be within the three month period of validity but, depending on the number and complexity of modifications, there may be a need for a new technical certification.

If the associated MR207 licence has already been purchased and transferred, then the modifications to the MR 207 licence can be completed in the normal way with the assessment of value and invoicing (or other approval process for a non-commercial licence);

Forms for modifications of Crown licences in MR 207 will be held by the Ministry and processed after 3 October 2010 in strict order of receipt. However if a modification is proposed, and the rightholder subsequently seeks to settle early, the MR 207 licence forms will be processed once the MR 207 purchase is completed.

Where a party initiates spectrum licence modifications as outlined above, the rightholder will be responsible for the preparation of all certification and registration documentation.

2. Creation of Spectrum Licences in MR 261 for FM broadcasting 

The frequency transition process from an original licence in MR 261 to a new licence in MR 207 involves the Ministry providing a transition licence, on the new frequencies in the current MR261, prior to the new licence coming into force on 3 April 2011.

The transition licences are restricted by conditions so that the rights cannot be exercised while rights under the original licence are being exercised. This allows certification of the transition licence without modification or cancellation of the original licence and a transition at a time suitable to the rightholder. The original licence which expires on 2 April 2011 can therefore be left to expire without any specific action being taken by the rightholder.

In some instances the presence of the original licence may inhibit the certification of a new temporary licence for another party until April 2010. In such circumstances a new temporary licence can be certified by the inclusion of a condition preventing the exercise of rights while rights under the original licence are being exercised.

A suitable condition is:
 

“The rightholder shall not exercise rights under this licence while rights are being exercised under licence number [insert number of original licence which conflicts with proposed licence]”.

In such circumstances it is also necessary to:
 

1. prepare modification instruments for the future licence in MR 207 to align with the proposed MR 261 licence (any increase in value will be charged accordingly);
2. ensure that the modified MR 261 licence and MR 207 licences meet all band plan and other policy requirements; and
3. ensure there are no special conditions applicable to the MR 207 licence

Where these requirements are not met, the application for the licence modification may be declined.