EAN spat still has legs as Belgian court punts questions to ECJ

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In its ongoing legal challenges over the hybrid ATG/S-band European Aviation Network, Viasat has fresh wind in its sails now that a Belgian court has punted questions to the European Court of Justice (ECJ) about the timing of Inmarsat’s deployment of the S-band satellite.

“While the court ultimately did not render a final decision – instead referring critical questions to the ECJ for a final Europe-wide decision – the court confirmed Inmarsat violated EU law; strongly suggested Inmarsat may no longer have rights to the S-band spectrum; [and] recognized that fair competition requires that operators be held to the commitments they provide during the tender process,” Viasat said in a strongly worded email regarding the ruling from the Brussels Court of Appeal’s Market Court.

Viasat added: “This ruling adds significant risk to the EAN program, and airlines should be worried and expect further delays – as the EAN will be subject to ongoing, serious legal challenges for a considerable period (as the ECJ process can take 18 months or longer to resolve).”

But as this legal battle moves from Belgium to the ECJ, Inmarsat believes Viasat is choosing to interpret some language “in an exceptionally elastic manner”.

Inmarsat director of corporate communications Jonathan Sinnatt told Runway Girl Network: “Viasat’s interpretation is, let’s say, they are being very fast and loose with the actuality here. The reality of the situation is this – the court in Belgium has not given any ruling on the merits of the case at all, and the merits of the case are not being heard by the ECJ. What is happening is there are two points of law, in terms of interpretation of European law, the judge has referred to the ECJ in order to assist that judge to make a decision. In our perspective, the right to award these licenses has been reviewed by every regulator in Europe.” He noted that Viasat’s challenge to Ofcom’s authorization of the UK complementary ground component (CGC) of the EAN failed, (though Viasat still saw positives, as reported by RGN Premium).

In punting to the ECJ, the Belgian judge asked whether national regulatory authorities (NRAs) must deny authorization based on the obligations of the original MSS tender decision.

The following text has been translated by Inmarsat’s lawyers from the original French, and provided to Runway Girl Network:

“Must Art. 4(1)(c)(ii) and Article 7(1) and Art. 8(1) of the [MSS Decision] be interpreted in the sense that if a [selected operator] has not provided the mobile satellite services through an [MSS system] by the deadline established under Art. 4(1)(c)(ii) of that decision, the [NRAs] mentioned at Art. 8(1) of that same decision must refuse to grant authorisations allowing such operator to deploy CGCs on grounds that such operator has not complied with its commitment it took in its bid?”

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“If the response to the first question is in the negative, must the same provisions be interpreted to mean that, in the same context, the [NRAs] can refuse to grant the [CGC authorisations] to that operator, because such operator has not complied with its coverage obligations by 13 June 2016?”.

After grappling with delays from SpaceX which necessitated a swap in launch partner to Arianespace, Inmarsat on 29 June 2017 confirmed the successful launch of the S-band satellite. It remains to be seen whether the ECJ will consider factors that might be deemed outside of Inmarsat’s control when considering the deadline question.

“We welcome the fact that these two questions are going to be answered. [We’re] very confident the ECJ will render a ruling in line with what the national regulators have done so that line of argument will be taken off the table for Viasat in every European jurisdiction,” said Inmarsat’s Sinnatt.

He added that Inmarsat’s EAN launch partner “is going to be rolling it out with their customers imminently”. British Airways is known to be the launch airline for the EAN, but the timeline for the program has certainly shifted to the right.

In an interview with RGN, Viasat head of litigation Colin Ward was a touch less inflammatory than Viasat’s email statement, which declared the EAN has “hit a major obstacle – which will cause a critical coverage gap in the middle of Europe: Belgium”. He clarified that there is nothing presently stopping Inmarsat from rolling out the EAN except in Romania, where he said the firm doesn’t have a license (after revoking Inmarsat’s license for the EAN on procedural grounds, Belgium last fall re-issued the license).

Ward reiterated that the Belgian ruling, while not a final decision, “does seem to express sufficient skepticism, and recognize the plausibility of the Viasat positions. It doesn’t say Viasat is right, certainly not, but it does seem to say Viasat makes an interesting point, and we must ask the Court of Justice.”

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Regarding coverage, Viasat believes the Belgian ruling forces the question of whether the EAN will meet the requirement to make service available to at least 50% of the EU population. The EU legislator, suggested Ward, “has not received a functioning system and in our view they’ll never receive a system that is compliant to a broad based percentage of the population and on time”.

Lest there is any question about whether Viasat is in this legal battle for the long haul, Ward said it’s worth mentioning that the court “didn’t refer all of the critical questions to ECJ”, such as whether the ground towers being used for the EAN qualify as CGCs. “That question is not going to ECJ, at least not in this case so even if the ECJ were to rule, let’s say, in Inmarsat’s favor, that wouldn’t actually end the legal challenges, because it wouldn’t answer everything.”

Meanwhile, Viasat is continuing its fight on a state level with Germany being “the best example which may have a ruling in the next few months, at least an initial ruling”, said Ward. The German court could grant interim relief, saying CGCs cannot operate in Germany, he explained, but noted that it’s “very rare” to get interim relief like that.

“If we were able to get a positive decision, that could impact legality of the decision sooner. Otherwise, this system can be operated right now under existing license but at some point the highest court in Europe will decide if those licenses should have been issued or if they ever were even allowed to be issued in the first placed,” he added.

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