BREITBAND KAERNTEN

Roll-out of public Fibre-to-the-Home (FFTH) network in the Southern part of Austria.

The objective of the project is to provide the passive infrastructure to cover around 22 000 households (HHs) in 40 municipalities in areas where private operators are not providing Very High Capacity (VHC) services due to lack of commercial interest. The network will be deployed in a point-to-point Fibre-to-the-Home (FTTH) configuration and will be commercialised through operators in charge of providing the active service to the final retail operators. The passive infrastructure included in the project will allow for 3 such operators to provide active service on an open access basis to the retail operators.

The Project concerns the roll-out of Very High Capacity Networks in the district of Carinthia (Austria) to connect 22k households in 40 municipalities in areas where private operators are not providing Very High Capacity Networks services due to lack of commercial interest. The Project focuses on rural and very remote areas.

The Project contributes to the policy objective of Digital Infrastructure. It will lead to the deployment of innovative and secure telecommunication technologies and thus generate positive externalities by enabling more users to benefit from improved and safe access to ultrafast broadband services, enabling innovative digital services and reinforcing digital transformation. These benefits are however not fully captured by the Project revenues, a market failure leading to underinvestment. Moreover, the Project addresses the typical market failures leading to underinvestment in infrastructures, due to significant investment costs, particularly in scarcely populated regions, in front of uncertain revenue flows.

The EIB loan is key for the diversification of the funding as it fully complements the grant structure and facilitates a solid financier base. As a first-time borrower BIK Breitbandinitiative Kärnten GmbH ("BIK") benefits from a long term to match the economic life of the underlying infrastructure assets. The flexible tranching of the EIB loan balances favourably the predefined grant regime. The long availability allows the borrower an optimized use of the credit line to enhance the implementation of the regional sub-projects.

Investments in fixed telecommunications projects (mainly civil works for fibre rollout) do not fall under the Annexes of the EIA Directive 2014/52/EU amending Directive 2011/92/EC. The related works have limited environmental effects, apart from disturbances during civil work construction, which can be mitigated by appropriate measures. Where and if applicable, the requirements of the environmental impact assessment Directive and the requirements of social standards will be verified during appraisal.

The Bank will require the Promoter to ensure that contracts for implementation of the project will be tendered in accordance with the applicable EU procurement legislation Directive 2014/24/EU as well as Directive 92/13/EEC or Directive 89/665/EEC as interpreted by the Court of Justice of the EU, with publication of tender notices in the EU Official Journal, as and where required.