NTA to annul license of CG Telecom

KATHMANDU, DECEMBER 19: Nepal Telecom Authority (NTA) will revoke a license awarded to CG Telecom to operate rural cellular telephony.  The company was notified about this in a written way yesterday, spokesperson of the NTA, Santosh Poudel, said.

According to him, as it failed to renew the license by the set deadline -Dec.1 2023, its license will be annulled as per the Telecommunication Act 2053.

The Chaudhary Group (CG) bought the license for rural telecommunication service from STM on  4th March 2016.  As the latter had renewed it for the first time on December 1, 2013, the former was required to do so for the second time exactly after 10 years.

So, what made the group reluctant to meet the renewal deadline? According to some insiders, it has much to do with its inability to replace one existing provision in the said act. As per the very provision, a telecom company needs to pay Rs 20 billion to renew its operating licenses for five years.

The CG was making attempts to cut down the size of this amount through the formulation of a new provision that sets a certain portion of the annual profit of a telecom company as a renewable fee.

Notably, the then government also led by the current Prime Minister had cunningly altered a provision related to the telecommunication service of the Nepal Gazzate (published on December 1 2013).

According to the provision, a license for unified telecom service shall be awarded to a telco only after creating the necessary infrastructure. However, it was skewed in favour of the CG  by mentioning that such a license could be distributed even before sich infrastructure was put in place.