Govt collects Rs 1.2b frequency fees from telcos

KATHMANDU, JAN 29 - The government has collected Rs 1.2 billion in frequency fees from telecom companies for service use during the last fiscal year. Though the size of the fee collected is higher than that of the previous fiscal year, the Nepal Telecommunications Authority (NTA) has faced problems in collecting fees as per the provision of the spectrum policy.


In 2012, the Ministry of Information and Communications introduced the “Telecommuni-cation Service Radio Frequency (Distribution and Pricing) Policy 2012” with a focus on charging a fee for the use of the third generation (3G) spectrum and revoking extra frequencies being used by telecom companies. Before the implementation of this policy, the government had collected a total of Rs 790 million in spectrum fees from telecom companies in fiscal year 2011-12.

Last year’s fee collection includes a total annual 3G frequency fee of Rs 480 million paid by Nepal Telecom (NT) and Ncell including penalties imposed on three companies—United Telecom Limited (UTL), Smart Telecom and Nepal Satellite Telecom for delaying fee payment. The NTA officials said that though there was a rise in fee collection, they had also faced practical problems in collecting fees from companies like NT and CG Communications (formerly STM Telecom Sanchar).

NT is yet to clear old dues relating to the 3G spectrum fee, while CG Communications has paid only Rs 2 million of an outstanding spectrum fee bill of Rs 28.8 million, according to the NTA.

Similarly, Smart Telecom failed to pay charges for the minimum frequency assigned to it as per the policy. According to the policy, the government can revoke the allocated spectrum if a company fails to clear their dues within the first nine months of each fiscal year.

“The policy has not talked about what should be the action if any company pays the fee partially,” said an official at the NTA. He added that NT had paid a portion of its 3G fee while CG had also done the same.

Depending on the type of telecom service licence issued, companies are required to pay frequency charges under the appropriate category, including ‘minimum’, ‘additional’, ‘maximum’, ‘3G’, ‘wimax’, ‘microwave’ and ‘VSAT’.

After the government fixed the 3G fee, Ncell last year had paid Rs 1.44 billion in 3G fees for the period 2007-2013, while the NT had paid just Rs 488 million of Rs 1.64 billion owed for 3G service use in the period 2006-2013, arguing that the service was launched commercially only from 2010 and that it faced a huge loss.

The policy had fixed Rs 240 million for 2X10 MHz 3G frequencies assigned to NT and Ncell. Earlier, there was no specific provision as regards government charges on 3G frequency usage. After

telecom companies complained of the policy being overly rigid, the NTA is preparing to conduct a study about their concerns, as well as complications in the policy’s implementation.

Based on the direction of the Communications Ministry, the NTA has formed a three-member task force under the coordination of Mahesh Prasad Adhikari, a board member of the NTA.

“We will soon start the assigned task to look over concerns of the operators,” said Ambar Sthapit, Deputy Director at the authority, who is also a member of the task force. Another member of the committee is Anup Nepal, Deputy Secretary of the Communications Ministry.