ECC to consider CMOs renewal fee

Aftab Ahmed

The Economic Coordination Committee (ECC) is set to review the recommendations of the committee which proposes to renew licenses of telecom companies in rupee terms instead of the US dollar.

The Pakistan Telecommunications Authority (PTA) and the Finance Division have opposed the license renewal fee for telecom companies in rupees.

Telecom companies approached the court for the renewal of licenses, which expired in 2019.

The telecom companies also demanded the government to charge them a license renewal fee in local currency rupee instead of dollars.

The government had set up a cross-stakeholder committee to address key issues in the cellular industry. The committee discussed proposals for the renewal of licenses, such as biometric verification fees, undertaking for the telecom sector, US dollars instead of spectrum pricing fees, and dispute resolution.

Details of these proposals were presented to the Cabinet’s Economic Coordination Committee (ECC) for a final decision.

PTA and Finance Division opposed charging license renewal fee in rupees instead of dollars. They argued telecom companies should initially pay a license renewal fee in dollars. However, the government may follow the proposal to charge a fee in rupees against the dollar.

The government formed a cross-stakeholder committee on April 6, 2020,  in line with the direction of the Prime Minister, to review the proposals of cellular mobile operators and make recommendations to the Prime Minister.

The Committee consulted with stakeholders and submitted a comprehensive report on the matter to the Prime Minister’s Office on 11 May 2020. The committee decided to submit proposals to the Economic Coordination Committee.

Accordingly, the Ministry of Information and Telecom has sent a draft summary to the ECC for consideration by all concerned organizations.

Licenses of mobile operators such as Pakistan Mobile Communications Limited (formerly Warid / Jazz) expired in May 2019. The PTA has set the price per frequency MHz (MHz) for frequency spectrum at $.5.5 million and 00.5.5 MHz at $52.5 million.

In total, these spectrum prices add up to $ 450 million for each company. Two cellular mobile operators (CMOs) took the matter to court. In his application, companies said to provide a level playing field with Ufone, which renewed its license in 2014 for $291 million. They demanded a reduction in prices. Later, the government decided to renew the licenses of telecom companies and set up a committee to discuss the matter.