IHC Directs Telenor & Jazz For Depositing 50% of License Renewal Fee

Islamabad High Court (IHC) has directed Telenor and Jazz for depositing 50 percent of license renewal fee i.e. around Rs 36 billion each in two weeks.

IHC Chief Justice Athar Minallah took up the appeals filed by Pakistan Mobile Communications Limited (Jazz) and Telenor Pakistan for hearing on Wednesday after the operators disagreed with Pakistan Telecommunication Authority (PTA) decision on fixing license renewal fee.

IHC Directs Telenor & Jazz For Depositing 50 Percent of License Renewal Fee

The operators had also requested for grant of stay order to avoid service disruption in the country after August 21, 2019—the date fixed by PTA for renewal of licenses.

The court has directed both the operators to deposit half of the amount i.e. 50 percent as guarantee till the final decision on the appeal of both cellular operators.

The court has granted stay order, confirmed by a senior official of a mobile company, adding that services would not disrupt in the country. The court would take up the matter next month again.

PTA in consultations with both the operators would determine how to deposit the guarantee amount i.e. as cash, bank guarantee or check within two weeks. According to the official, the court has directed for depositing the guarantee to remove the impression of seeking time by the operators.

PTA had rejected mobile operators’ apprehensions relating to the price of license renewal and passed an order while fixing the fee for license renewal at $39.5 million per MHz for frequency spectrum of 900 MHz and $29.5 million per MHz for frequency spectrum of 1800 MHz. However, Jazz and Telenor went into appeal against PTA decision.

The PTA has directed operators to pay their license fee before August 21, 2019, or their licenses will be termed expired and they will not be allowed to provide telecom services after the deadline.

Mobile licenses of Telenor and Jazz expired on May 26, 2019. PTA has passed a verdict relating to licence renewal of Jazz and Telenor, details for which are as following: fee for renewal of license shall be the US $ 39.5 million per MHz for frequency spectrum of 900 MHz and the US $ 29.5 million per MHz for frequency spectrum of 1800 MHz; licenses will be renewed with effect from 26th May, 2019 for a period of further fifteen (15) years, on a technology-neutral basis, subject to the payment of renewal fee to be calculated in accordance with per MHz price as mentioned above, the payment terms for the renewal fee shall be 100% upfront or 50% upfront with the remaining 50% in five (5) equal annual instalments on LIBOR plus 3%, the payment can be made in US dollar or in equivalent Pak rupees calculated at the market exchange rate at the time of payment, the upfront payment, as given above, shall be paid on or before 21-08-2019.

In case of non-payment of upfront fee, the license will stand expired, the terms and conditions relating to enhanced quality of service and coverage of network shall be finalized in line with applicable regulatory practice and 2015 Policy after consultation with the licensee on or before 21-08-2019, in case, the licensee opts for non-renewal of its license, it shall pay a fee on pro-rata basis of the renewal fee along with all other applicable fee and other charges of the license commencing from 26-05-2019 till the date of withdrawal/vacation of the radio frequency spectrum.

Recommended Reading: Mobile License Renewal Fee Justified- PTA

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