Department of Telecommunications

O/o the Controller of Communication Accounts

Chhattisgarh Circle Raipur

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EVOLUTION OF LICENSING FINANCE FUNCTION

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HISTORICAL BACKGROUND

Radio Paging was the first service allowed for private sector to provide in 1992.
In 1995, the tenders called for offering Cellular services and 42 Cellular Service licenses granted.
In 1997 , tenders called for offering Basic Services AND 6 Licenses granted.
The above licenses required payment of fixed license fee, payable quarterly in case of Cellular Licenses and yearly in case of Basic Service Licenses.
New Telecom Policy announced in 1999 which envisaged payment of license fee as a percentage of revenues as well as opening of other services like NLD, ILD for private participation.
On 22.07.1999 , a migration package was offered to the Cellular and Basic Service Licensees with date of effect of migration as 01.08.1999.
Migration package offered the following reliefs:-

Payments of license fee as a percentage of revenues

Remission of six months license fee period

All dues of the fixed LF period to be paid along with interest (Entry fee)

Removal of duopoly in grant of CELLULAR Licenses and withdrawal of all litigations by the licensees.
License fee fixed at 15% provisionally for the Cellular Services w.e.f 01.08.1999 , which was fixed at 12% , 10% and 8% w.e.f Jan 2001
License fee for Basic Services at 12 %, 10% and 8% w.e.f 01.08.1999.
In 2001, fresh tenders invited for offering Cellular Services and new licenses granted (4^th Cellular Licenses)
In 2001, 27 new Basic Service Licenses granted based on payment of entry fee.
Three (3) new ILD and three (3) new NLD Licenses granted in 2002.

DEVELOPMENTS

· Guidelines for migration to Unified Access Service License issued in Nov.2003

· Salient features of UASL

1. Full mobility allowed to Basic Services operators

2. Roll out obligations, FBG / PBG , service area etc as per 4^th Cellular Service Licenses.

3. All new access licenses to be granted under the category of UASL.

4. Migration to UASL subject to payment of entry fee (diff. of entry fee paid by Basic operators minus that paid by 4^th Cellular).

5. No restrictions on number of access licensees in a service area.

6. Technology neutrality

· All 33 existing Basic Services Providers migrated to UASL and 20 new applications received for UASL.

· Intra- Circle mergers / takeovers allowed subject to minimum 3 Access Service Providers.

· Reduction in License Fee w.e.f. 01.04.2004 by 2% of AGR for all Access Providers with an additional 2% for 1^st two circle Cellular Licensees.