Kathmandu, July 25

Nepal Telecommunications Authority (NTA) has collected a total of Rs 15 billion as licence renewal fee from two major telecom companies — Nepal Telecom (NT) and Ncell. The fee was collected in the last three fiscals in installments of Rs 2.5 billion every year from each of them.

The government provision requires both the companies to clear their licence renewal fee of Rs 20 billion each in installments over a period of eight years. The facility was provided through a Cabinet decision three years ago regarding first renewal of mobile service permit. NTA says that both the companies paid the third installment before the end of last fiscal year 2014-15.

“The two companies have paid Rs 7.5 billion each out of their total renewal fee of Rs 20 billion,” said Achyuta Nanda Mishra, assistant spokesperson for NTA. Even though the government started collecting the first renewal fee under installment provision three years ago, it is yet to determine the size of the fee for the second renewal of mobile permit.

NTA had renewed the mobile service licence of NT for the second time last year but since a decision regarding the second renewal charge has not been made, the state-owned firm is only making payment for the first renewal of Rs 20 billion. The second renewal enables the state-owned telecom company to operate GSM mobile service till May 2019. In the same year, Ncell will be required to make its second renewal.

After obtaining a licence for the first time, telecom service providers are allowed to operate for 10 years. After that, they have to get their licences renewed every five years. The size of the fee has remained a dispute between the regulator and NT and as a result, the government had been directed by a parliamentary committee four years ago to look into international practices to devise a new provision.

An eight-member team was also formed under coordination of secretary of Ministry of Information and Communications (MoIC) last year. However, the team is yet to complete its study and recommend the fee provision. The MoIC secretary is also chairman of the NT board. The existing legal provision requires both NT and Ncell to pay Rs 20 billion in renewal fee.

A source at MoIC said that it was taking time to reach a decision on the second renewal fee as the study team is yet to gather necessary information related to the provisions in the international markets. MoIC had also decided to send the team to India, Bangladesh, Malaysia and Thailand to conduct the study. As part of the plan, a visit to India has already been completed.

The study team or panel, which is currently led by MoIC Secretary Sunil Bahadur Malla, comprises three other senior officials of MoIC, three from NTA and a joint secretary from the Ministry of Law and Justice.

The issue of the second licence renewal carries huge importance as other mobile operators would also have to perform by remaining within the same provision.

Agreeing to pay Rs 20 billion as renewal fee, Smart Telecom had acquired unified licence that allows operation of multiple telecom services, including cellphone service. Similarly, United Telecom Ltd (UTL) is also all set to obtain the unified licence as it has already paid the required charges to get one.