Unified telecom licence attracts flurry of court cases

KATHMANDU, APR 22 -Discussions on telecom issues are shifting from the board room to the courtroom with a series of cases being filed against the government’s unified licence and new spectrum policy. The uproar was triggered by the government’s plan to introduce a unified licence for varied services in the domestic telecom sector. The plan to bring new cellular mobile operators through a unified licence from among the small telecom companies operating presently has run into legal hurdles.

As of the present, seven cases have been filed at the Supreme Court (SC) against the government’s move. The unified licence permits telecom companies to operate multiple services including GSM mobile, freeing them from obtaining separate licenses for each of them. The unified licensing provision is seen as a bid to create a level playing field for all the existing telecom companies.

On Sunday, the court issued a show cause order in response to a writ filed by advocate Megh Nath Khanal demanding that the government stop implementing its decision regarding the unified licence. The court has asked the defendants to explain why the unified licence was being awarded.


After the government decided to issue the unified licence, Smart Telecom, one of the small telecom companies, acquired the licence last Monday. On the same day, two supplementary writs were filed against the unified licence and the government’s decision to issue the licence to United Telecom Limited (UTL) and Smart Telecom.

Meanwhile, the SC issued an interim order on Monday not to implement Clause 14 of the new spectrum policy, which includes a provision to collect the licence renewal fee in advance in instalments from the companies acquiring the unified licence. The SC’s ruling followed a writ questioning the legitimacy of the board of the Nepal Telecommunications Authority (NTA) that was formed as a stopgap measure to make necessary decisions.

So far, three petitions seeking an annulment of the unified licence, two cases arguing that the NTA’s current board is not legally empowered to make policy decisions and one case regarding the legitimacy of the new spectrum policy are under consideration by the SC and awaiting a final verdict. “We move according to whatever verdict the court gives,” said NTA spokesperson Kailash Prasad Neupane. He added that the main focus was on bringing competition by issuing unified licences to the four small companies and giving customers more choices in the market.

Meanwhile, there is a dispute among NTA officials too regarding its decision to issue unified licences to the two telecom companies. Sources said that the government had failed to do the necessary preparations like formulating a standard guideline to give licences and re-farming spectrum to assign to the new mobile operators. The NTA board, formed as a temporary solution on April 11 by activating Clause 60 of the Telecommunications Act 1997, had decided to issue unified telecom licences to Smart Telecom and UTL.  

Advocate Narayan Prasad Devkota, who has filed a petition against the unified licence provision, said that the government had introduced the new licensing provision against the law. He added that the existing telecom act did not allow the government to bring new mobile companies without competition.

Unified licences are not only the issue being disputed in court. A case regarding the appointment of NTA chairman Digambar Jha is sub-judice. Limited spectrum, renewal fee, “silent objection” of big telecom companies  and objection by Nepal Telecom workers’ unions have resulted in legal hurdles, according to government sources. They added that the NTA had failed to take the issue of committed royalty in the new licensing regime and free up the required spectrum. As the result of a spectrum shortage, the NTA had decided to assign only 5 MHz to UTL and Smart Telecom in 900 MHz band while issuing their licences.  

With the unified licence issue being engulfed in controversy, Smart Telecom has not been able to do anything as per its plan for service rollout. While obtaining the permit, it had paid around Rs 500 million in varied fees including the licence fee and the first instalment of the licence renewal fee.