Nepal Telecom (NTC) has been issued a new license with a validity of five years to operate its GSM cellular mobile service. The government provided the company with a new license in accordance with Section 20 of the Telecommunications Act, 2053.
On Thursday, Baisakh 27, 2081, the Council of Ministers issued a directive to Nepal Telecommunication Authority (NTA) to re-issue Ntc a new license in accordance with Subsection 4 of Section 33 of the same Act. Today (Baisakh 28, 2080), the company reaches 25 years of service. The latest development follows a series of assumptions and debates about whether the company would be allowed to continue its service with a license. However, with its new license, the company can provide its GSM cellular service at least for the next five years. The space for questions rose mostly with the rule that a telecom company in Nepal has a maximum of 25 years of validity. However, the government resorted to the prevailing law to provide the leading telecom company with a new license.
Sub-section 4 of Section 33 of the Telco Act has a provision an existing individual or a foreign person with up to fifty percent investment at a telecom company may receive the license once again after its expiry. “In case of the Telecommunications Service operated with the investment of foreign person or corporate body up to fifty percent, the previous Licensee may, after the expiry of the period of the Licence, operate the Telecommunications Service by obtaining the Licence once again.” Ntc has a 92% investment from the government so, the provision applies to it in its favor for a new license.
The new license follows a lump sum payment of Rs 20 billion
Earlier, Nepal Telecom paid a lump sum of Rs 20 arab for the third license renewal of its GSM mobile service. The company deposited the amount in NTA’s account. The new steps to obtaining the license were also shared at its 20th anniversary. The odds would have been solely against the company for its new license had it not paid the amount to the government.
Ntc had already sent a letter to the NTA expressing its desire to continue its cellular service and asked the regulator to facilitate the environment for a license. Sending the letter conformed to the Act where a company must make it clear whether it wants to continue with the service 3 months before its term ends. The company sent its application to NTA for mobile service license renewal on Magh 28, 2080.
Check out: Latest Ntc Data Pack [2024] Price, Volume, Validity, Process
Nepal Telecom gets a new license for its GSM mobile service
NTA allocated the state-backed telecom giant its new license for its telecom services. The authority’s spokesman Santosh Paudel confirmed that on Friday, Baisakh 28, 2081, the NTA board decided to award Ntc its new operating license. The route was not rosy for the company though.
Just a few days ago, there were protests from Ntc workers’ unions after the company decided to make a lump sum payment for its third license renewal. NTEAN, NTCWU, NTEU, and NEONNT protested the company’s decision to pay Rs 20 arab for license renewal. The four workers’ unions had even staged a sit-in protest outside the company’s MD office demanding that the company not pay the license renewal fee in a lump sum without a guarantee of its future. The company has sorted out the matter making its license renewal payment a calm and swift affair.
Interesting phase for the telecom industry in Nepal
Currently, the telecom industry is going through a testing phase. Axiata exited Nepal selling its Ncell stakes to Spectrlite UK citing a challenging business environment. CG, UTL, and Smart Cell lost their telecom service license which was directly and indirectly related to their incompetence in the market and financial inability but also the lack of conducive policy from the government to blame. Moreover, both Ntc and Ncell have posted financial results that show a decline in revenues each year. More in detail: All the Major Challenges Telecom Operators Are Facing in Nepal
Additionally, the government’s persistence on exorbitant fees for license renewal and a “lack of concrete efforts” to create a level-playing field for the companies has drawn much scrutiny. Experts have long called for high-quality and more affordable services and an entry of a third competitive telco. The latter looks distant even today. For now, Ntc is to get its new license for GSM mobile service. Ncell, on the other hand, will see its license expire in 2086. This also draws possible scrutiny on the government’s “discrepant” treatment between Ntc and Ncell.
Nepal Telecom first received the license for GSM cellular mobile service on 29 Baisakh 2056. Now, it will start a new tenure with a new license from Saturday, Basiakh 29, 2081. Nepalitelecom.com extends its heartiest congratulations to Nepal Telecom on getting a new license for its GSM mobile services and hopes that its commitment to expanding connectivity and digital inclusion continues to bring more fruitful results in the coming years.
