E-Kantipur

KATHMANDU, MAY 19 -

The Appellate Committee under the Ministry of Information and Communications is to examine the royalty row between the Nepal Telecommunications Authority (NTA) and United Telecom Limited (UTL).

“We will meet within a couple of days to go through the UTL affair,” said Dhan Raj Gyawali, under secretary at the ministry and member of the committee. He added that they had obtained information related to UTL’s case from the NTA.

The committee is headed by Jiban Hari Adhikari, secretary of the Judicial Council. Joint secretary at the ministry Narayan Regmi is one of the two members.

UTL, the first private sector telecom service provider, had appealed to the committee against the NTA’s directive to clear its committed royalty dues on April 28, the deadline of the 35-day notice to clear outstanding royalty dues. The company has not paid around Rs 900 million in committed royalty to the government as of the last fiscal year citing loss in business and demanding the same treatment as other operators.

According to the NTA, the company has committed to pay Rs 324.18 million as royalty to the government for basic telecom service in the current fiscal year.

On March 25, the NTA had written to UTL to clear its royalty dues within 35 days or face cancellation of its operating license. UTL had approached the committee as per the Telecommunication Act 1997, which allows telecom operators to appeal against the decision of the NTA.

A high level official at the authority said that the committee was just going through the motions and would not reach a decision any time soon. “Let us take the example of ADSL. There has not been any decision regarding the ADSL case filed by Nepal Telecom for a long time,” said the official.

However, Gyawali said that the ADSL and UTL cases were being considered by the committee.

The NTA official said that the chances of a final verdict against UTL were very slim as there had been pressure from India. Finance Minister Bharat Mohan Adhikari had assured visiting Indian External Affairs Minister SM Krishna that the UTL issue would be resolved “at an early date in accordance with the earlier understandings between the two governments”. However, even high-level officials are not aware of the understandings made between the two governments. “It is diplomatic language. We don’t know of any understanding,” added the official.

Out of the committed royalty for eight years (fiscal 2002-03 to 2009-10) amounting to Rs 1.24 billion, UTL has paid Rs 160.57 million and Rs 189.45 million was waived by the then royal regime in 2005. The NTA has been saying that the royalty dues of UTL would increase to more than Rs 1 billion except the royalty committed for the current fiscal year as it has been paying only 4 percent of the total income for three services — basic telecom, limited mobility service and data service.

UTL is a joint venture between three Indian telecom companies — Mahanagar Telephone Nigam (26.68 percent), Telecommunications Consultants India (26.66 percent) and Tata Communications (26.66 percent) — and local partner Nepal Ventures (20 percent). With Mahanagar Telephone Nigam and Telecommunications Consultants India being public sector undertakings, the issue was taken up strongly by Indian External Affairs Minister Krishna during his visit to Nepal in April.

Posted on: 2011-05-19 09:05

Post Your Comment

Please note that all the fields marked * are mandatory.
* Full Name
* Address
* Email Address
* Comment
* Captcha	Get another CAPTCHA code
Note:	Comments containing abusive words or slander shall not be published.