A SATELLITE broadband provider has lost its High Court challenge to the refusal by the Minister for Communications to accept submissions from it under the National Broadband Scheme, which provides State aid to companies to extend broadband services to remote areas. The decision has cleared the way for the NBS contract to be awarded later this month.

Mr Justice Brian McGovern dismissed the challenge by National Broadband Ltd (NBL), a partner of SES Astra SA with offices at Castleknock, Dublin, on several grounds, including NBL's delay in bringing it and its failure to pursue alternative remedies, including challenging the scheme itself under the EU Treaty.

NBL had challenged the Minister's refusal to accept submissions from it for the purposes of being included in the NBS tender map.

In his decision the judge noted that the European Commission had in November 2007 found the NBS fully compatible with EU state aid rules. He also ruled that NBL had failed to show that the mapping process under the NBS breached those rules.

He was satisfied that the Minister had considered and assessed the cost and capability of satellite technology to provide broadband services when drawing up the scheme and the mapping exercise.

If a decision was made without the Minister hearing from NBL itself, that point appeared to be "a purely technical one", as the department had heard submissions from satellite providers, including John O'Brien while he was with a company using similar technology. Mr O'Brien has been a director of NBL since it was incorporated in February 2007.

The decision not to include satellite broadband in the mapping exercise under the NBS was neither unreasonable nor irrational, the judge ruled. He noted that the Minister had been in contact with the commission in relation to the broadband scheme since October 2006 and the commission had been informed of the department's view that satellite provision of broadband was not seen as viable for the mass market.

The department had evidence at that time that the number of subscribers to satellite broadband was less than 0.6 per cent of all broadband subscriptions in the State. It also believed satellite broadband suffered from technical difficulties. The judge accepted that those matters were canvassed with the commission. If NBL was unhappy with the commission's decision, it could have sought to annul it before the European Court of First Instance, or it could have asked the commission to revoke it on claims that it was based on incorrect information.

Lawyers for SES Astra complained to the commission in January 2008 about its authorisation of the NBS but there was no evidence to show that the commission acted on that complaint or that SES applied to the Court of First Instance.

The first action by NBL relating to the scheme was taken in January 2008. The judge accepted the Minister's argument that NBL had delayed its challenge and should have moved at an earlier date.