Govt can now take ownership of telecommunication firms that fails to settle arrears

KATHMANDU:  The government can now take ownership of the telecommunication company that fails to settle arrears as per prevailing laws.

The Nepal Telecommunications Authority (NTA ), on Friday, endorsed the Telecommunications (Service Provider Regulation and Property Management) Guideline, 2077 allowing the government to take control of licensed telecommunication firms in case they fail to clear tax due to the government.

The guideline states that NTA can take the ownership of telecom firms by giving them a seven-day notice in advance if the company fails to clear arrears within the final deadline. The guideline which has been prepared based on the Telecommunications Act, 2053, has also provision whereby the government can take control of telecommunication service providers that are operating without licenses.

NTA should make the decision public before three days of taking such firms in control. The guideline states that telecommunication infrastructure, structure, system and telecommunication network of the company not completing renewal process within the stipulated time will automatically be transferred to the government from the day after the reinstatement period expires.

NTA chairperson Purushottam Khanal said that the guideline has been prepared to clarify ownership management of firms that fail to implement direction of NTA regarding due clearance and license renewal. He informed that the guideline has clarified the process of regularizing the services of the concerned companies even after the government takes them under control. As per the guideline, the service provider will have to operate the service for some time as per the instructions of the authority even if the service provider is operating without license and that the government has taken control of the firm.

Similarly, necessary arrangements should be made to continue the telecommunication service in consultation with other telecommunication companies for time-being even after NTA takes control of the service provider. In case that the government takes control of a telecommunications company, the NTA may appoint a person or a committee of individuals and give necessary instructions to operate and manage it. The property of the service provider operating without license has to be managed within six months as per the conditions determined by the same committee.

Similarly, the government can also liquidate such company to settle the company’s liabilities. After settling the property this way, the remaining property should be returned to the service provider while the company will automatically lose the frequency that it was using, as per the guideline. The guideline has also a provision whereby the government/NTA can form a management committee to continue the telecommunication service of those firm that are acquired by the government and manage the property owned by them.

Based on the documents prepared by the management committee, NTA can auction the returned frequency of such operators and their assets among service providers in operation. In case none of the service providers in operation participate in the bidding process, the NTA will auction such frequency and assets through open competition.