PTA Faces Scrutiny for Unauthorized Changes to LDI License Clauses

According to the Auditor General of Pakistan, PTA made unauthorized alterations to Long-Distance and International, LDI license clauses without the required federal government approval. This development has raised serious concerns about transparency and adherence to legal procedures within the telecom regulatory framework.

The debate is all about the introduction of new clauses—particularly, clauses 3.2.6 to 3.2.8—under the “Network Rollout Obligations” section of the LDI license issued to M/s Zeta Technologies (Pvt.) Ltd. on January 5, 2023. According to the Auditor General, these modifications were made in violation of the Telecommunication Policy 2015 and the De-Regulation Policy 2003. These policies mandate that any changes to licensing terms should be approved by the federal government and involve consultation with relevant stakeholders.

PTA Caught Altering LDI License Clauses Without Federal Approval

The Telecommunication Policy 2015, especially Rule 5.2.3, clearly states that any changes to the licensing regime need federal approval and consultation with sector stakeholders. Moreover, Rule 4.2.1 (b) of the De-Regulation Policy 2003 directs that licensees may lease infrastructure from PTCL or other owners on non-discriminatory terms, with long-term leases acceptable in place of ownership. However, PTA’s unilateral changes to the LDI license template seem to evade these procedural safeguards.

The Auditor General’s report underscores the negative impact of these unauthorized changes on the telecom sector, especially on infrastructure providers. The modifications can intrude on the rights of licensees as stipulated in Sections 5(b) and 6(a) of the Pakistan Telecommunication (Re-organization) Act, 1996, which accentuate the enforcement, monitoring, and protection of licensee rights.

The issue was raised with PTA management and the Principal Accounting Officer (PAO) in November 2023. At that time, PTA defended the changes, stating that they did not modify the scope of the license or the overall licensing regime. Even though, the authority argued that the changes were planned to promote the modernization of telecommunication systems by enhancing the percentage of fiber-to-the-tower/site (FTTT/FTTS) infrastructure.

However, the Auditor General considered this explanation unsatisfactory. Moreover, he urged that such changes should have undergone proper consultation and federal approval. After that, the matter was brought to the Departmental Accounts Committee (DAC) on December 20, 2023, where the DAC directed PTA to reconsider the changes with the Cabinet Division and get them verified by the Audit. However, no further progress has been made, leaving the issue unresolved and raising questions about the translucency and legality of the PTA’s actions.