It is sometimes desirable to limit the field of applicants to parties that have demonstrable financial and technical qualifications to achieve the objectives of the regulator. In these cases, the licensing process includes a pre-qualification phase. During the pre-qualification phase, potential applicants must demonstrate or confirm that they meet the pre-qualification criteria in order to be eligible to participate in the licensing competition.
The pre-qualification criteria are usually minimum requirements that establish a baseline of financial capability and technical competence. In some cases, applicants must demonstrate past experience in providing certain types of services or running a specified type and size of network. In other cases (typically spectrum auctions), applicants must confirm that they already hold a particular kind of telecommunications or ICT licence. The fact that an applicant holds the designated licence serves as evidence of its financial capability and technical competence since the applicant would have had to meet such criteria in order to obtain the designated licence. This approach was used in the 2007 Nigerian 800 MHz spectrum auction and in the 2007 10.5 GHz spectrum auction in Singapore, for example.
In some cases, legislation or regulations require regulators to include a pre-qualification phase in a competitive licensing process. In Saudi Arabia, for example, the Telecommunications By-law requires that the Communications Information and Technology Commission (CITC) include a pre-qualification phase in any auction or comparative evaluation process. The By-law broadly identifies financial capability and technical capability as the two pre-qualification criteria that applicants must meet to participate in a competitive licensing process. The CITC is authorized to determine the specific form and substance that is used as measures of whether an applicant has meet these two pre-qualification criteria.