IMDA escalates Simba probe over intentional spectrum misuse; operating licence at risk

SINGAPORE - Probes into Simba Telecom have escalated with fresh allegations that its unauthorised use of radio frequency bands were intentional, and had been approved by the firm’s senior management.

In an Australian Securities Exchange filing on Oct 26, its parent company Tuas said that Simba had been issued a Show Cause Notice from the Infocomm Media Development Authority (IMDA) to explain and debunk the fresh allegations, failing which the telco could face a fine or lose its licence to operate.

The unauthorised spectrum use, first disclosed in May, contributed to the collapse of its proposed $1.4 billion acquisition of M1. 

Among the fresh allegations include Simba having deployed dynamic spectrum sharing to about 133 sites for intermittent periods in 2022 and 2023, allowing the use of 2,100 megahertz band spectrum for both 4G and 5G, when Simba was only authorised to use the 2,100 MHz band spectrum for 5G. 

Radio frequency bands, or spectrum, are invisible airwaves that carries signals that communication systems rely on. IMDA allocates and assigns spectrum frequencies to mobile operators for their dedicated use, and telcos are allowed to use only the spectrum frequency assigned to them.

The telco is also alleged to have used the 2,340 MHz to 2,360 MHz band spectrum without authorisation at about 92 sites for intermittent periods between 2023 and 2026.

These instances are alleged to have been intentional and approved by Simba’s senior management.

Other fresh allegations by IMDA include the unauthorised deployment of 5G network equipment at two locations in 2023, failure to comply with a production order issued by IMDA, and a “deliberate and intentional” failure to produce documents, which have led to concerns about deficiencies in Simba’s governance and compliance culture.

The telco has been given until November 16 to respond to the notice.

The IMDA also said Simba faces a possible spectrum rights suspension or cancellation, and/or a fine of up to $1 million or 10% of Simba’s annual Singapore revenue, whichever is higher. 

IMDA may also cancel or suspend Simba’s telco licence or a part of it, or reduce the period for the licence.

Tuas said Simba intends to respond to the IMDA notice by the required Nov 16 deadline.

“As the matter remains under consideration by the regulator and no findings have been made or confirmed, Tuas does not intend to provide further comment on the matters raised in this announcement,” Tuas said in its bourse filing.

Tuas shares plummeted over 33% after markets opened on Oct 26. It traded at AUD$1.21 as of 9.50am, down from its previous closing price of AUD$1.81.

The investigation into Simba Telecom became public in May, when IMDA suspended its review of the telco’s $1.43 billion bid for M1’s telecommunication business, citing unauthorised use of radio frequency bands.

In September, the telco admitted that it had used spectrum beyond the limits permitted by the regulator, with management attributing unauthorised usage of the 2,300 MHz spectrum to a combination of hardware and software issues. It did not give further details.