NTA prepares to repeal Smart Telecom license

Nepal Telecommunications Authority (NTA) — the telecommunications regulatory body — is preparing to revoke the license of telecom service provider Smart Telecom after the telecom failed to clear arrears to the government as the extended deadline for the same expires.

The Council of Ministers last extended the deadline by six months (until mid-January) for the telecom to clear arrears and directed to revoke the license if the arrears were not paid by the deadline.

The government had given Smart Telecom an option to pay the outstanding amount in five installments. However, the telecom had been dillydallying instead of depositing installments for the last two years. The telecom has to pay around Rs 5.5 billion by mid-January.

NTA Chairman Purushottam Khanal said the only alternative now was to revoke the license as Smart Telecom exhibited no intention of paying dues owed to the government. “There has been no information regarding payment made till today,” he said.

Khanal said the cabinet had previously directed to proceed with canceling the license and it was his duty to implement the decision.

Out of the outstanding amount owed, Smart Telecom had to deposit Rs 598.8 million in the first installment, Rs 832.3 million in the second, Rs 774 million in the third, Rs 715.6 million in the fourth and Rs 657.2 million in the fifth installment. Similarly, Rs 1.25 billion as license renewal fee is also pending, subject to additional penalty and interest.

Even after revocation of license, NTA faces another challenge in terms of managing the assets and customers of Smart Telecom as there is no law regarding the management of assets of a telecom service provider.

NTA will have to manage the immovable property, towers, network and customers of the telecom after revoking its license.

To address this problem, NTA prepared a draft of ‘By-laws on Asset Management’ last year and submitted it to the Ministry of Communications and Information Technology, informed Khanal. “The by-laws are in the process of being endorsed,” he added.

The absence of by-laws provides Smart Telecom the opportunity to play with the issue, experts say.

According to NTA’s Management Information System report for October, Smart Telecom has 2.367 million subscribers using GSM voice service and 153,745 subscribers using 4G service, including dozens of towers and other physical assets. Khabarhub