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Cabinet to take call on 3G admin charges

The Telecom Commission is learnt to have referred the issue of an annual administrative charge of 2% of the highest 3G bid to the a cabinet committee.

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NEW DELHI: The Telecom Commission, the highest decision-making authority in the Department of Telecommunications (DoT), is learnt to have referred the issue of an annual administrative charge of 2% of the highest 3G bid to the Cabinet Committee on Economic Affairs (CCEA).

The Commission has also forwarded its note to Prime Minister Manmohan Singh, who now holds the additional charge of the finance ministry as well.

In its meeting on Friday, the full Telecom Commission failed to reach a conclusive decision on the annual spectrum charges, including the administrative fee, to be imposed on 3G (third generation) telecom players.

As per the existing DoT calendar, the 3G pre-bid conference is on December 23, while the auction is scheduled for January 16, 2009. There’s no official word yet on whether the Telecom Commission’s stand to refer the annual charge matter to the Cabinet would have an impact on the 3G auction calendar.

The Telecom Regulatory Authority of India (Trai) had earlier this month recommended a market-linked annual fee for 3G players. Trai had told DoT that an annual administrative charge of 2% of the highest bid must be imposed on the 3G service providers, in addition to the revenue-share charges.

More recently, Trai had also pointed out that the annual revenue-share fee proposed by the DoT was in variance with the regulator’s recommendation of July this year.
According to a DoT spokesperson, “the outcome of the meeting of the Telecom Commission is not known.”

Even as DoT was not in favour of accepting the Trai recommendation of 2% administrative charge, it may have thought best to refer the matter to the CCEA to prevent any further controversy.

Communications minister A Raja has been under fire for allocating 2G licences earlier this year on a first-come-first-serve basis rather than going for an open auction process.
In its 3G information memorandum, DoT had said, “the government does not intend to make a further allotment of spectrum in the 2.1GHz, 2.3GHz or 2.5GHz bands (other than the blocks being offered currently) within the next 12 months.”

Meanwhile, a PIL has been filed by an NGO in the Delhi High Court against the 3G auction process. Also, some internet service providers are opposed to the idea of broadband auction being conducted in a frequency band where they offer their services.
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