The Office of the Adjudicator
Broadcast Transmission Services

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Office of the Adjudicator – Broadcast Transmission Services - Report for the period 1 October 2023 – 31 December 2023

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Consultation 1/2024: Operating Budget for The Office of the Adjudicator - Broadcast Transmission Services

Welcome to the website of the Office of the Adjudicator, Broadcast Transmission Services. This website describes the function of the Adjudicator, the process to be followed when requesting an Adjudication and Guidance documents on the setting of Reference Offers.

Purpose of the Office

On 11 March 2008, the Competition Commission (CC) announced its decision to allow the merger of transmission companies Arqiva and National Grid Wireless (NGW) subject to the agreement of a package of measures (undertakings) to protect the interests of their customers.

Arqiva and NGW overlap in the provision of Managed Transmission Services (MTS) and Network Access (NA) to transmitter sites and associated facilities for terrestrial television and radio broadcasters. In its final report, the CC found that Arqiva and NGW were the only active providers of MTS/NA to the UK television broadcasters. The companies were also the most significant providers of national MTS/NA to UK radio broadcasters with a combined market share of more than 85%. In both cases, prior to merger, the companies had exercised a competitive constraint on each other.

The CC concluded the merger of the two companies would lead to a “substantial lessening” of competition in broadcast transmission services. The CC found the loss of rivalry between Arqiva and NGW would lead to a worsening in the price and non-price factors on which the parties compete in the provision of MTS/NA to television and radio broadcasters.

After formal and informal consultation by the CC with Arqiva, its customers and other stakeholders, the Commission accepted undertakings from Arqiva on 1 September [].

The undertakings are intended to, amongst other things, adequately protect existing and new customers over the terms and conditions of supply, including protection against future price rises and protection against changes in non-price related clauses (such as discrimination issues and service standards).

The definitive document on the obligations placed on Arqiva and the responsibilities and powers of the Adjudicator is the Undertakings agreed between Arqiva and the CC. This document summarises the general principles and processes that will be followed in resolving disputes.

In order to meet this aims of the Undertakings, the Adjudication regime needs to be efficient, effective and sufficiently flexible to respond to changes in the market and/or customer requirements. Therefore several key objectives need to be considered, and at times potentially balanced against one another:

  • providing certainty (as regards to the application of the undertakings) and transparency for customers;
  • encouraging the commercial negotiation of contracts on a bilateral basis;
  • providing customers with an accessible and uncomplicated dispute resolution process where commercial negotiations fail;
  • a flexible approach to determining disputes in accordance with FRND and cost oriented principles; and
  • quality decision making in a timely manner.

Key aspects of the Adjudicator’s role:

  • The Adjudicator is responsible for:
    • Dispute resolution
    • Issuing guidance to Arqiva, which is published for the benefit of customers on (a) the approach to setting charges for new transmission/NA agreements and sale of MTS assets and (b) on the application of the undertakings and adjudication process
    • Provision of periodic reports to Ofcom and the OFT
    • Ensuring that costs incurred by Arqiva in Digital Switchover are correctly recorded and conducting regular audits of this expenditure
    • Requiring Arqiva to provide reference offers
    • Ensuring that Arqiva maintains and enforces a Security Strategy to manage the flow of commercial information within the company
    • Ensuring Arqiva provides transparency in the calculation of its changes and that these changes are cost-orientated
  • The decision of the Adjudicator is binding on a dispute and not subject to a merits-based appeal
  • The guidance on the undertakings issued by the Adjudicator to Arqiva will not be unduly prescriptive. In the interests of efficiency the Adjudicator has the flexibility to apply an appropriate methodology as he sees fit, to ensure that the principles of FRND and cost orientation are applied to contractual terms
  • Moreover the Adjudicator has the flexibility to use as much and as wide-ranging information as appropriate when determining the outcome of disputes
  • The Adjudicator is expected to take account of Ofcom’s sectoral regulation when making decisions in order to promote consistency
  • The adjudication process should be seen by Arqiva and its customers as a fall-back option; customers are expected to first undertake bilateral negotiations with Arqiva on a good faith basis with a view to entering into commercially negotiated contracts. Only where a satisfactory agreement cannot be reached should customers then turn to the dispute process. The Adjudicator has the right to resolve disputes only where it can be proven that reasonable attempts have been made, without success, to negotiate terms commercially

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