Ukraine 3G auction at risk after spectrum decree

KIEV, Oct 21 (Reuters) - Ukraine's president overturned a government decision to transfer parts of the radio spectrum for mobile phone network use, casting doubt on a 3G licence tender scheduled for next month. In a decree published on Wednesday President Viktor Yushchenko, who is at odds with the government of Prime Minister Yulia Tymoshenko, said the decision was overturned to safeguard Ukraine's defensive capabilities.

In many countries old radio waves no longer used by the military have been handed over for civilian use as telecom operators, broadcasters and businesses using wireless networks and services battle for access to the spectrum.

The government had planned to hold an auction of licences next month, with a minimum price of 400 million hryvnias ($50 million).

Ukraine's largest mobile phone operator, Kiyvstar, which is part-owned by Norway's Telenor (TEL.OL) and Russian Alfa Group's Vimpelcom (VIP.N) was among the expected bidders.

The government awarded a 3G licence to the country's dominant fixed-line operator Ukrtelekom in 2005 ahead of its launch of mobile phone services and to boost its attractiveness before selling it off. Successive governments have failed to privatise Ukrtelekom.

Yushchenko last month banned the privatisation of the Odessa Port plant two weeks before its auction. The privatisation agency carried out the auction but then said the sale had failed because the prices offered were too cheap. [ID:nLT43051]

Former allies Yushchenko and Tymoshenko are expected to run in a presidential election on Jan. 17. Polls show Tymoshenko would face former premier Viktor Yanukovich in a second round. Yushchenko's popularity ratings are in single digits.

(Reporting by Yuri Kulikov; writing by Sabina Zawadzki; editing by John Stonestreet)