The Telecom Regulatory Authority of India (TRAI) has released recommendations on Reforming the Guidelines on Transfer / Mergers of Telecom Licenses.
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Earlier TRAI had issued consultation paper on Reforming the Guidelines for Transfer / Merger of Telecom Licenses.
The regulator welcomed feedback / inputs from the stakeholders on Transfer/ Merger of Licenses to enable simplification and fast tracking of approvals.
Thereafter the authority received comments from 9 stakeholders & counter comments from 2 stakeholders. After that an Open House Discussion (OHD) was conducted on 23rd December 2019 in New Delhi.
Today TRAI has finalized its recommendations on Reforming the Guidelines on Transfer / Mergers of Telecom Licenses.
For calculation of one year i.e. time period allowed for transfer/merger of various licenses in different service areas
subsequent to the approval of the Tribunal/Company Judge, the time spent in pursuing any litigation on account of which the final approval of a merger is delayed, should be excluded.
The second part of the clause 3(c) of the M&A guidelines, which provides an exemption from substantial Equity/cross holding clause for a period of one year or more as extended by the Licensor, should be modified such that the exemption from substantial equity / Cross Holding clause is provided only for a period till transfer/merger of licence is taken on record by the Licensor.
The last sentence of the clause 3(c) of the guidelines, which provides that the period of one year allowed for
transfer/merger of various licenses in different service areas subsequent to approval of the Tribunal/Company Judge, can be extended by the Licensor by recording reasons in writing, should be appropriately brought under the clause 3(b) as it defines the timeline.
The Authority recommends that the clause 3(h) of the guidelines may be amended such that:
(a) for determining the market share for Access, Internet, VSAT, GMPCS, PMRTS, and INSAT MSS-R service licenses/ authorizations, both number of subscribers as well as AGR should be considered.
(b) for determining the market share for rest of the service licenses/authorizations viz. NLD, ILD and Resale of IPLC, only AGR should be considered.
The Authority recommends that it should be explicitly mentioned in the guidelines that consequent upon payment of market determined price for spectrum, such spectrum would be treated as liberalized i.e. technology neutral.
The Authority recommends that the guidelines on transfer/merger of licenses should not hard-code the spectrum caps. Instead, it should be linked with the relevant clause of the license.