BII TRANS TECH responds to Beijing Subway policy: Communication base fee reduced by 30%
BII TRANS TECH responded to the Beijing subway policy, announcing that starting from July 1, 2025, it will reduce the basic fees for operators using the civilian communication transmission system by approximately 30%. This policy aims to accelerate the construction of 5G communication in subways and enhance passenger experience. The group will sign a supplementary agreement with operators to ensure a smooth transition of the fee adjustment and will no longer bear the investment in communication systems for newly constructed subway lines. It is expected that the fee reduction will lead to a decline in total revenue of less than 5% for the year 2025
According to the Zhitong Finance APP, BII TRANS TECH (01522) announced that the group charges fees and earns revenue from mobile telecommunications operators through leasing civil communication transmission systems. These operators can use this system to provide voice and data services for mobile devices within subway lines.
On June 26, 2025, the group received a notice from Beijing Infrastructure Investment Co., Ltd. (BII Company) (BII Company is the ultimate controlling shareholder of the company and is wholly owned by the State-owned Assets Supervision and Administration Commission of the People's Government of Beijing Municipality), informing them that there have been adjustments to the civil communication business policy: to accelerate the construction of 5G civil communication for subways, enhance passenger travel experience, and improve service quality, the group needs to cooperate in completing the following tasks:
(1) Reduce the fees for operators using the basic supporting facilities of the civil communication transmission system by approximately 30%, effective from July 1, 2025. The group needs to promptly sort out the fee execution situation with operators and communicate to study and sign supplementary agreements, etc., to ensure a smooth transition of the fee reduction; and
(2) Gradually eliminate the transmission service fees for operators using 4G and below signal civil communication transmission systems. In the future, the group will no longer bear the investment and construction of the civil communication transmission system for newly built subway lines and the 5G civil communication transmission system for existing subway lines. The group will (a) fully cooperate with all parties to accelerate the construction of 5G civil communication for subways and enhance operational service levels; and (b) to address the business risks brought by the rapid development of 5G communication technology, cooperate in studying the transfer plans and possibilities of 4G civil communication assets.
To implement the relevant work requirements stated in the notice, the group is expected to sign a fee reduction supplementary agreement with operators and explore various plans to address the business risks brought by the rapid development of 5G communication technology. The group will also continue to strengthen its main business segments and explore new opportunities to expand its business portfolio and maximize shareholder interests. As of the year ending December 31, 2024, revenue from civil communication business accounted for less than 20% of the group's total revenue. According to the company's currently available information and preliminary assessment, the decline in the group's total revenue for the year 2025 (compared to the total revenue for 2024) due to the single factor of fee reduction is expected to be within 5%. Furthermore, as of the date of this announcement, the group understands that there is no clear timeline for the gradual elimination of fees, which will depend on the consultations among the relevant parties
