Amendments to Broadband Subsidies Act take effect – funding for constructing fixed connections only

The President of the Republic confirmed amendments to the Act on Broadband Construction Aid on 16 December 2021. The most significant change is that future subsidies may only be granted for constructing fixed broadband network. The Government also issued a decree on the minimum speed of a broadband connection. The Act and Decree will enter into force on 3 February 2022.

The Broadband Subsidies Act and its subordinate Government Decree that originally took effect in 2021 have been amended to ensure continued compliance with European Union state aid rules and the General Block Exemption Regulation. The name of the law was changed from the current Act on Broadband Construction Aid to the Act on Construction Aid for Fixed Broadband.

Amendments to the General Block Exemption Regulation governing the aid scheme took effect on 3 August 2021. The Block Exemption Regulation governing state aid has introduced separate new criteria for subsidising fixed and wireless networks. 5G networks may not be subsidised in areas that already have 4G or 5G network coverage. 4G networks in Finland cover 99.9 per cent of the population. It will accordingly no longer be possible to subsidise the construction of Finnish 5G connections in future, as permitted under current legislation. Provisions governing such aspects as assessing competition impacts and the conditions for granting aid have also been clarified. National broadband aid legislation must comply with the amended requirements of the Block Exemption Regulation by no later than 3 February 2022.

Minimum speed of eligible connections increases

The Government has increased the minimum speed of eligible telecommunications connections to match the rising requirements of the General Block Exemption Regulation. The Regulation requires subsidised broadband connections to have a download speed of not less than 300 megabits per second and an upload speed of at least 100 megabits per second.

Municipal payment contributions are national regulations and will not change.

What's next?

The Government budget proposal for 2022 includes an allocation of EUR 15 million for the broadband subsidy programme. This programme seeks to make high-speed broadband available to 30,000 households. The proposed appropriation is part of the funding sought from the EU Recovery and Resilience Facility, with Finland requesting a total of some EUR 50 million for broadband subsidies.

Funding from the 2021 budget is EUR 5 million.

Regional Councils will arrange competitive tendering for broadband subsidy project areas with a view to selecting network builders. The selected network builder may then request a subsidy from the Finnish Transport and Communications Agency (Traficom).

Broadband subsidies are part of the Government programme. The broadband aid scheme is accordingly targeting areas where commercial broadband will not be available before 2025.

Inquiries:

Maija Ahokas, Director of Unit, tel. +358 29 534 2390, maija.ahokas(at)gov.fi, Twitter @mmaija

Aino Koskinen, Senior Specialist, tel. +358 29 534 2224, aino.koskinen(at)gov.fi