Treasury facing £300m phone bill after mobile network court challenge

The Treasury was facing the prospect of a rather expensive mobile phone bill on Wednesday, after a £300m appeal against a significant increase in annual license fees was upheld.

Westminster had ordered telecoms regulator Ofcom to raise the annual license fees it charges mobile networks to use radio spectrum in 2015, after it was left disappointed by a 4G spectrum auction in 2012, in which it netted £2.3bn.

The industry reacted with anger, as some operators were left with annual fees up to three times higher.

On Wednesday morning, the Court of Appeal upheld a challenge from operators that the government was not allowed to order Ofcom to push the fees higher, under European Commission rules on infrastructure investment.

The ruling means Treasury is now likely to have to refund operators the increased fees paid over the last two years - a bill understood to be between £200m and £300m.

That is, unless Westminster decides to challenge the Court of Appeal ruling in the Supreme Court.