Telecom licence norms amended to elevate the ‘spectrum cap’

In order to incorporate the Cabinets’ nod to increase the number of instalments for payment of spectrum fees to 16 years, and to revise the spectrum cap norms, the government has amended the Unified Access Service License (UASL) and Cellular Mobile Telephone Service (CMTS), w.e.f. 19-03-2018. The Cabinet had on 07-03-2018 approved the proposal of Department of Telecommunications’ (DoT) to let operators opt for a one-time increase in instalments (maximum 16) to pay for spectrum acquired in auctions from 2012-2016. These instalments are based upon the principle that the Net Present Value (NPV) of the ‘Payment Due’ is protected as enumerated in respective NIAs (Notice Inviting Applications) for auctions in the years 2012, 2013, 2014, 2015 and 2016. The same spectrum cap would be applicable for all telecom service providers in that licensed service area, and the spectrum caps will be revisited after the final acts of World Radiocommunication Conference (WRC) 2019 [to be held in Egypt].

The amendments are a part and parcel of the Unified Licence Agreement, with all the terms and conditions being unchanged. The Telecom Department also approved removal of intra-band cap of 50 % spectrum held by an operator in a circle, and instead allowed an operator to have not more than 50 % of all the sub-1GHz bands such as the 700MHz, 800MHz and 900MHz put together. This will allow operators to hold 35 % of the total spectrum assigned in a circle against the current cap of 25 %. However, there will be no change in the value and interest rates that telecom companies have to pay for the spectrum. The total amount that telecom operators will pay for the spectrum will be higher by Rs 74,446.01 crore till 2034-35 if they opt for more number of instalments. The amendment is part of the relief measures for the sector which is reeling under a debt of Rs 7.87 lakh crore.

[Source: The Hindu BusinessLine]

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