TRAI consultation on extension of DTH licence issued

The Telecom Regulatory Authority of India (TRAI) has released a consultation paper on extension of DTH licence. The matter has been taken up by TRAI after the Ministry of Information and Broadcasting had sent a reference letter to TRAI on September 30, asking to frame the terms and conditions for extension of DTH licence on expiry of the 10-year period.

The main issues taken up in the consultation paper pertain to entry fee, bank guarantee, licence fee and duration of extension period.

The matter has come to the surface as the licence period of Dish TV ended on September 30, 2013 and there were no guidelines or recommendations for renewing a DTH licence.

The validity period of a DTH license is 10 years on a non-exclusive basis, and shall be reckoned from the date of issue of Wireless Operational License by the Wireless Planning and Coordination (WPC) Wing of the Ministry of Communications, unless terminated earlier for default or for insolvency or for convenience or for transfer of the License. 

Also the DTH guidelines stipulate that the DTH licensee shall pay an initial non-refundable entry fee of Rs 10 crore before the issue of Letter of Intent by the licensor, and after the issue of the Wireless Operational License by the WPC, an annual fee equivalent to 10 per cent of the gross revenue in that particular financial year needs to be paid.

Regarding the bank guarantee, present guidelines state that the Licensee shall, within one month of the issue of SACFA clearance by the WPC, have to submit to the MIB a bank guarantee from any scheduled bank in Form-C for an amount of Rs 40 crore, valid for the duration of the license.

The regulator also highlighted that the licensor shall be at liberty to encash the bank guarantee in full or in part in the event of non-payment of the license fee or violation of any of the license condition.

The issues raised for consultation are:

• Should an entry fee be charged at the time of issue of a new licence to the existing DTH licencees? In case an entry fee is to be charged, what should be the quantum of such entry fee?

• What should be the period of the DTH Licences to be issued to existing DTH licencees on the expiry of the licence period of 10 years?

• What should be the period of extension/renewal of the licences, to be prescribed in the DTH Guidelines, for the extension/renewal of the new DTH licences on their expiry?

• What should be the quantum and the validity period of the bank guarantee to be furnished by an existing DTH licencee on the issue of a new licence?

• Any other relevant issue you would like to comment upon.

TRAI has sought the comments and views from various stakeholders on its consultation paper. Last date for receiving the comments is October 15, 2013.

Source: http://cablequest.org/news/dth-news/item/3313-trai-consultation-on-extension-of-dth-licence-issued.htmlSource: http://cablequest.org/news/dth-news/item/3313-trai-consultation-on-extension-of-dth-licence-issued.html