Brazilian operators could delay payment for 4G

22 August 2014 | Kavit Majithia


Brazil’s 4G auction will not give the government the $3 billion it needs to meet its end of year fiscal goal after regulators said winning operators could delay payments on 90% of bids.

The 700MHz auction will take place on September 30, and is expected to a raise a total of $3.34 billion (7.71 billion reais).

It has been revealed that winning operators can pay 10% of its bids up front, with the rest of the fees paid over a six-year term, with a three year grace period.

However, an inflation price adjustment has been implemented to avoid late payment, and Brazil’s finance ministry has previously stated it was hoping 4G auction would help its 2014 goal.

President Dilma Rousseff has overseen a dramatic deterioration of the country’s finances, and there are fears the government will fail to reach its target after poor budget numbers over the past few months.

Regulators’ said that each of the three nationwide auction slots will require a minimum bid of 1.927 billion reais to be successful.