The Islamabad High Court (IHC) has directed Telenor and Jazz for depositing 50 percent of licence renewal fee, i.e. around Rs 36 billion for each company, within two weeks as guarantee.
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 to Pakistan Telecommunication Authority (PTA) decision on fixing licence 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 licences.
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 a stay order, confirmed a senior official of a mobile company, saying that services would not disrupt in the country. The court would take up the matter next month again.
The PTA in consultation with both the operators would determine how to deposit the guarantee amount i.e. as cash, bank guarantee or cheque within two weeks. According to official, the court has directed for depositing guarantee to remove the impression of seeking time by the operators.
The PTA had rejected mobile operators' apprehensions relating to the price of licence 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 the PTA decision. The PTA had directed operators to pay their licence fee before August 21, 2019 or their licences would be termed expired and they will not be allowed to provide telecom services after the deadline.
Mobile licences of Telenor and Jazz expired on May 26, 2019. The PTA has passed a verdict relating to licence renewal of Jazz and Telenor, details of which are as following: fee for renewal of licence shall be $39.5 million per MHz for frequency spectrum of 900 MHz and $29.5 million per MHz for frequency spectrum of 1800 MHz; licences 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 percent upfront or 50 percent upfront with the remaining 50 percent in five (5) equal annual instalments on LIBOR plus 3 percent, 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 licence will stand expired, the terms and conditions relating to enhanced quality of service and coverage of network shall be finalised 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 licence, it shall pay a fee on pro-rata basis of the renewal fee along with all other applicable fee and other charges of the licence commencing from 26-05-2019 till the date of withdrawal/vacation of the radio frequency spectrum.
In an official statement, Telenor has stated that it would make significant payment towards licence renewal to reaffirm its commitment to Pakistan. Telenor Pakistan voluntarily offers to pay $224.6 million under protest to safeguard the interest of its valued customers.
In order to reaffirm its commitment to the country, Telenor Pakistan, while preserving its legal rights, has offered to make a substantial payment of $224.6 million to the government to ensure continuity of services and preserve rights of over 44 million valued customers.
Telenor Pakistan shall continue to pursue its legal case to fully protect its rights available under law, in order to have final resolution of the matter. The company remains hopeful of a fair outcome and looks forward to the government and PTA to fulfil their commitment to ensure fair competition and forward-looking policies and regulations.