The Bangladesh Telecommunication Regulatory Commission is likely to modify the 3G auction process, bowing down further to the demand of the mobile phone operators, said BTRC officials.
They said the operators were lobbying with the commission high-ups to turn things into their favour including elimination of phased auction system and price of unsold block.
‘We presented the draft auction process to the operators and also arranged a demonstration of the auction software on Tuesday. Now the operators are up for auction engineering,’ a senior BTRC official told New Age.
The commission is likely to agree with operators’ terms and conditions as the government is desperate for holding the auction ahead of the next national elections, he said.
The BTRC informed the mobile phone companies about the auction procedure in a meeting on July 30 where the operators opposed the procedure claiming that it would increase competition.
According to BTRC draft auction process, the auction will be conducted in three phases — first phase will be for 10 MHz, second phase for 5 MHZ and the last phase for unsold block, if any.
The participants who will bid for 10 MHz spectrum will be allowed for bidding for the unsold spectrum. The participant who will bid for 5 MHz will not be eligible for bidding the unsold block.
The draft auction procedure also recommended raising the price of each call at the auction to $1 million per megahertz from $5,00,000.
It also suggested sale of the unsold block at a lower rate.
The commission officials said the operators opposed the procedure and demanded withdrawal of the slab-based auction process.
The operators claimed such slab-based auction would facilitate the big companies and the small operators might not find enough spectrums for themselves.
They also demanded that the amount of the earnest money should be lower from $20 million.
Five existing mobile phone companies of the country on Monday submitted applications for
participating in the auction for 3G services, scheduled for September 8, after the government had met almost all of their demands bowing down to the pressure.
No foreign company, however, submitted the application for 3G auction for one licence reserved for foreign operators because of alleged syndication by the existing operators to prevent new competition.
Grameenphone, Banglalink, Robi, Airtel and Citycell, before submitting the applications, demanded that the government must resolve the SIM replacement tax issue before August 26 which is the last date for submitting bid earnest money.
The National Board of Revenue claimed SIM replacement tax worth Tk 3,100 crore from the mobile operators saying that they were dodging the tax unlawfully.
The NBR recently reduced the VAT on 3G licence for the second time to 5 per cent from 7.5 per cent following government order because it was one of the major preconditions by the operators for submitting the application. The VAT on 3G licence was initially set at standard 15 per cent.
The revenue board reduced the SIM tax to Tk 300 from Tk 600 in the national budget for FY 14.
The revenue board on August 6 exempted the mobile phone operators from paying 15 per cent VAT on their revenue from 3G services to be shared with the BTRC.
Earlier the government reduced the floor price of the auction from $30 million to $20 million following operators’ demand.
The BTRC will award four licences to five mobile companies operating in the country as the state-owned mobile operator Teletalk got 3G licence by default.
A total of 40 MHz of spectrum will be auctioned for eight blocks where a single bidder can bid for maximum two blocks.
The minimum allocation for a spectrum block is 5 MHz with base price of $20 million for each MHz.
-With New Age input
