Telcos finally get licences renewed

After a delay of more than eight months, four mobile phone carriers–Grameenphone, Banglalink, Robi and Citycell–finally got their 2G licences renewed yesterday.
The licences would stay valid for the next 15 years.
The licences were supposed to be renewed in November last year but the process was delayed due to a number of court battles between the telecom regulator, carriers and the tax administrator.
The carriers had objections to fees related to spectrum allocation and value added tax and they had taken the issues to the High Court.
Although some of the cases are still pending with the apex court, the operators got the licences at the intervention of the telecom and finance ministries.
Telecom Minister Rajiuddin Ahmed Raju handed over the licences to the carriers at the office of Bangladesh Telecommunication Regulatory Commission (BTRC) in the capital yesterday.
BTRC Chairman Zia Ahmed, Grameenphone CEO Tore Johnsen, Robi CEO Michael Kuehner, Citycell CEO Mehboob Chowdhury and Banglalink’s Chief Technical Officer Ahmed Fady were present.
The four carriers are paying over Tk 7,562 crore to the government as spectrum assignment and renewal fees, while another Tk 1,134.45 crore will have to be paid as VAT.
However, the carriers will get a rebate on the VAT. Each operator will have to pay Tk 5 crore as annual licence fee.
The largest carrier, Grameenphone, will pay Tk 3,241 crore for its 14.6 Megahertz spectrum, Banglalink Tk 1,971 crore for 12.4 Mhz, Robi Tk 1,900 crore for 12.8 Mhz, and Citycell will have to pay Tk 450 crore for 10 Mhz. The amounts exclude VAT.
They will pay Tk 10 crore each as licence renewal fee.
The carriers have already paid 49 percent of their licence renewal charges to the government, and will pay 29 percent of the amount on August 31, and the rest at the yearend.
There has been controversy over the spectrum assignment charges as different operators are paying different charges per Megahertz spectrum. Grameenphone, for instance, is paying more than Tk 220 crore per MHz allocation, while Citycell is paying Tk 45 crore.
The policy for the spectrum charges was suggested by the regulator on the basis of market shares of the carriers and the policy was finally approved by the prime minister.
Last year, the telecom regulator proposed a total of Tk 11,704 crore as spectrum charges for the four carriers. Later, the telecom ministry revised the proposal and sent it to the finance ministry, which again modified the proposal and the Prime Minister’s Office finally gave a go-ahead.
The 800MHz, 900MHz and 1800MHz bands have been priced at the same rate.
The carriers now share 5.5 percent revenue with the government and 1 percent more for a social obligation fund (SOF), meant for the development of the information and communication technology sector. The SOF was introduced with a new guideline.
Among the carriers, Citycell’s licence was issued in 1989 for 20 years while the other threes’ were given in 1996. The then government did not charge any fee for spectrum allocation and the carriers used to pay $400,000 and had shared 1 percent of their revenue with the government for the first five years.
For the second five years, the operators paid $800,000 and shared 1 percent revenue with the government, according to the licence conditions. But in July, 2006, the regulator made it mandatory for them to share 5.5 percent revenue until November, 2011.
Of the other two mobile phone carriers in the country, state-owned Teletalk got its licence in 2004 and Airtel (former Warid Telecom) in 2005. Their licences will expire in 2020 and they will follow the conditions of revenue sharing and SOF.
The BTRC chairman said six mobile phone carriers have so far invested Tk 50,000 crore and contributed around Tk 19,009 crore to the state coffer.
The telecom minister said he recommended awarding GSM frequency to Citycell, which recently applied for it.
More than nine crore people are currently using mobile phones in Bangladesh.

-With The Daily Star input

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