3G guideline ready for auction

The posts and telecommunications ministry on Tuesday finalised the 3G licence guideline reducing the spectrum block allocation to 5 MHz with base price at $20 million and licence validity for 15 years.
‘We sent the final draft to the BTRC today (Tuesday) and hope they will complete the formalities within the shortest possible of time to start the auction for 3G licence,’ telecom secretary Md Abubaker Siddiqi told New Age on Tuesday.
He said the new guideline was designed considering the operators’ valid demands and the government’s interest as well.
According to the new guideline, total 40 MHz is available for auction where any bidder can avail maximum two blocks, 10 MHz, and new entrant would be allowed beside the telecom operators.
Ministry officials said the government decided not to increase the licence validity to 20 years as it would increase the licence fees as well.
Earlier, at the end of 2012 the finance ministry set $20 million as the base or starting price for the auction for per megahertz spectrum.
The new guideline relaxed the conditions of payment with a provision of foreign investment only for capital machinery and allowing bank loans for other payments.
The new guideline, however, kept the provision of paying 50 per cent of the total amount of spectrum assignment fee as deposit to the BTRC within 30 working days from the auction.
The remaining 50 per cent of the spectrum assignment fee will have to be paid within 60 working days from the auction.
The new guideline also relaxed the condition that the Bangladesh Telecommunication Regulatory Commission can cancel the 3G licence without any notice.
It said that if any licensee was found violating any rules, then it would call for hearing before cancellation of licence, subject to approval of the ministry.
On the VAT related issues, the new 3G guideline said that VAT would be collected as per the standard procedure.
Ministry officials said as the VAT issues of mobile companies were pending before the court, the new 3G guideline’s VAT provisions was kept neutral.
They said the operators should pay VAT as per the demand of the National Board of Revenue.
In a meeting with the ministry on January 30, the mobile phone operators demanded increasing the licence validity to 20 years and relaxing the payment deadline after winning the licence.
The government in October allowed state-owned mobile operator Teletalk to launch the 3G service on a trial basis.
Teletalk will get a licence without participating in the auction, while five local private operators —Grameenphone, Banglalink, Robi, Airtel and Citycell — and other foreign firms will vie for the licence. Teletalk will have to pay for its 10 MHz spectrum at the rate the other winners will pay.