Top Cellular Providers Petition High Court Over "Arbitrary" Frequency Fees

The five largest cellular companies in Israel — Partner, HOT Mobile, Pelephone, Cellcom, and Viacom — have filed a petition to the High Court of Justice against the Ministry of Communications and Communications Minister Shlomo Karhi, demanding a significant reduction in frequency fees and the launch of a long-delayed economic review.

In their joint petition, the companies are asking the court to order the ministry to update the frequency fee structure and implement a 70% discount on existing fees. They argue that the current model is outdated and economically unjustified, resulting in massive costs to the industry and ultimately, to consumers.

Billions in Annual Revenue — at Telcos' Expense

The telecom companies claim that frequency fees, which are paid annually in exchange for the wireless spectrum they use, currently total hundreds of millions of shekels per year across the industry. Citing the state’s tax revenue report for 2023–2024, they state that in 2024 alone, the government collected NIS 8.8 billion in total fees, with approximately 5%—about NIS 440 million—originating from the telecommunications sector. They allege that the majority of that amount comes from their frequency fee payments.

“These fees make up about 5% of all fees paid in Israel, yet they are based on a pricing model created in 1995, without any comprehensive economic valuation of the frequencies,” the petition states.

Delays, Extensions, and Lack of Transparency

The companies argue that the Ministry of Communications has failed to fulfill its obligation to reassess the value of the spectrum and adjust the fees accordingly. Although a temporary order issued in 2015 allowed for partial discounts, it was originally intended to be in place for just three years. Since then, it has been extended six times, and is currently set to expire on June 30, 2026.

Despite repeated appeals by the telecom providers in 2024 and 2025, they say the ministry has neither conducted the required economic review nor provided a timetable for doing so.

“The Ministry of Communications has refrained from carrying out, and even from committing to carry out, the required economic examination regarding the value of the frequencies,” the petition reads. “It has also failed to set clear deadlines for completing the process.”

Ministry: We Will Review and Respond

In response, the Ministry of Communications issued a brief statement:

“The ministry has received the petition. We intend to study it and respond accordingly.”

Industry Impact

The outcome of the petition could have a significant impact on the Israeli mobile market, which is facing rising infrastructure costs tied to 5G rollout and network expansion. Executives from the telecom firms argue that outdated fees hinder investment in innovation and service improvements and that reform is long overdue.

Industry observers suggest that a court ruling in favor of the providers could set a precedent for reassessing other regulatory fees and increase pressure on the government to modernize legacy frameworks in the digital economy.