Will Indian Telecom Companies Get Fees Refunded from Cancelled Licenses?
February 27, 2012
By David Sims
, TMCnet Contributing Editor
It seems the current furor in Indian telecom is whether or not there should be a large refund for companies who saw their mobile permits cancelled the first week in February.
According to The Economic Times, an Indian industry journal, the Indian government department responsible for telecommunications, DoT, is trying to get legal clarification on the issue. The amount involved is Rs. 9,500 crore worth of license fees and other monies.
Okay, “crore:” It’s an Indian unit of numerical measurement denoting 10 million, so in Western parlance it would be an issue of 95,000,000,000 rupees, or about US $2 billion. So, worth taking the time for.
Evidently between 2001 and 2007, according to The Economic Times, there were 73 licenses issued to older telecom companies, and what the journal describes as “37 dual-technology licenses” awarded from 2007 to 2008, as well as up to 122 other assorted licenses.
The crux of the issue seems to be not whether the licenses should be re-awarded, it doesn’t appear that’s going to happen, the process for granting the spectrum was dubbed “fundamentally flawed,” but what the legal fallout is and who gets what -- what happens to the 3G spectrum where holders’ permits have been cancelled? Should the license fees be returned? Can pending court cases against these companies be pursued? What about launching new services, where are the approvals for that going to come from and when?
Frankly there are at least a couple dozen such issues, but the major ones revolve around the fees paid by the companies awarded permits for spectrum which now have been revoked. Part of the problem is that the Indian Supreme Court just revoked the licenses without spelling out what needed to happen with the funds.
The journal notes that some companies are already mulling their legal options, including claiming refunds and other damages against the government.
Edited by Juliana Kenny