Advisory for telecoms operators navigating Spain's demanding regulatory environment

Spain’s telecommunications sector brings together approximately 5,463 active companies and employs more than 74,359 Social Security-registered workers, with aggregate revenues of €37.6 billion that make it one of the country’s highest-value service sectors. An average gross margin of 19.3% and a five-year survival rate of 43.2% — below the broader economy average — reflect the competitive intensity of a market dominated by a handful of large operators competing on price and coverage, while the rest of the ecosystem — MVNOs, regional ISPs, tower and fibre infrastructure companies — fights to differentiate. Spain’s 17.7% share of the European market is driven by the leading position of domestic groups across Latin America and southern Europe.

The sector is experiencing structural transformation shaped by three vectors: the mass deployment of fibre optic infrastructure — Spain leads Europe with more than 85% FTTH coverage — the rollout of 5G networks across spectrum bands awarded by the Ministry of Economic Affairs, and market consolidation through mergers among infrastructure operators. All of this takes place under the supervision of the CNMC, which has significantly increased its regulatory activity in recent years, and in a European context shaped by the European Electronic Communications Code — transposed by Spain’s General Telecommunications Act, reformed in 2022 — which introduces new obligations around coverage, technology neutrality and wholesale access.

At BMC we advise national and international telecoms operators, mobile virtual network operators (MVNOs), internet service providers (ISPs), tower and fibre infrastructure companies and OTT platform providers on all tax, legal and regulatory aspects of their operations in Spain. Our services include tax planning for multinational telecoms groups with Spanish presence, transfer pricing documentation for shared network services and technology platforms, processing general authorisations and licences before the CNMC, negotiating wholesale access and interconnection agreements, and designing B2B and B2C contracts adapted to sector-specific regulations. We also represent operators in administrative proceedings and litigation before the CNMC, the AEPD and the administrative courts.

Data protection and cybersecurity represent a specific regulatory risk for the sector. Telecoms operators are classified as essential service operators under the NIS2 Directive, requiring enhanced cybersecurity measures, notification of significant incidents and periodic audits. At the same time, the processing of traffic and location data — inherent to the telecoms business model — generates particularly demanding obligations under the GDPR and the ePrivacy Directive, currently being reformed at European level. Our team combines tax, legal and regulatory expertise to deliver comprehensive coverage that supports operators from the product design phase through to managing enforcement actions before the AEPD or the CNMC.

Key services for telecoms operators

Tax planning for telecom operators involves the amortisation of fibre optic networks, mobile towers and radio equipment under specific rules that affect the corporate tax position; the VAT treatment of bundled telecom services (voice, data, television); and the management of digital services tax obligations in jurisdictions where the operator provides services. For international telecom groups, the structuring of passive infrastructure (towers, antennae) through infrastructure funds or REITs generates specific tax and accounting considerations.

Regulatory management is a continuous operational requirement for telecom operators. Relations with the CNMC and the Ministry for Economic Affairs on spectrum allocation, licence renewals, access obligations, interconnection rates and the resolution of consumer complaints must be managed with legal and regulatory expertise that understands the technical and commercial dimensions. We advise on administrative proceedings, regulatory compliance and the legal aspects of spectrum transactions and network-sharing agreements.

Transfer pricing for telecom groups requires management of roaming revenues and interconnection fees across the double taxation treaty network, transfer pricing for shared network infrastructure and brand licensing between group entities, and the classification of digital services for VAT purposes. Spain’s AEAT pays particular attention to transfer pricing in large telecom groups, making robust documentation essential.

Regulatory challenges for the telecoms sector

Data protection and cybersecurity are critical compliance vectors for telecom operators. The network security obligations under DORA, the NIS2 Directive and the CNMC sector-specific regulation, together with the GDPR requirements on the treatment of traffic data and user location data, constitute a very demanding regulatory framework. We integrate data protection and telecommunications law advisory into our overall service to the sector.

The EU’s Digital Markets Act (DMA) and Digital Services Act (DSA) create significant compliance obligations for telecom operators classified as gatekeepers or as intermediary services. The management of content moderation obligations, interoperability requirements and data access rights for third parties under these new frameworks requires continuous legal monitoring and proactive compliance programme management.

KPIs and trends for Spanish telecoms 2025-2026

Spain’s telecommunications market generated revenues of more than €38 billion in 2024, with mobile data, fibre broadband and audiovisual content as the main growth drivers. Fibre optic coverage reached 92% of homes, one of the highest rates in the EU. The consolidation of the Spanish telecom market — following the MásMóvil-Vodafone Spain merger and ongoing consolidation among regional and MVNO operators — is creating a more concentrated market structure with higher ARPU but also increasing regulatory scrutiny. At BMC we advise telecom operators, infrastructure investment funds and technology companies serving the sector with integrated tax, regulatory, employment and corporate finance advisory.