PTCL’s use of illegal 3G spectrum causing $300 million loss to govt

Islamabad:  PTCL’s blatant violation of Spectrum Regulations, Competition Laws and continued illegal use of costly 3G wireless spectrum is not only causing huge losses of more than US $300 million to Government exchequer but destroying the broadband competition on the other hand, thus paving way for re-establishing monopoly of incumbent, PTCL.

This was stated in a press release issued by Internet Service Providers Association of Pakistan (ISPAK). PTCL since 2010 has been using costly 3G spectrum for its wireless broadband services advertised as EVO Nitro and occupied about 40% extra 3.75 MHz of spectrum not originally allocated to it by PTA.

 ISPAK made complaints to Frequency Allocation Board (FAB), the national body for enforcing use of wireless spectrum, and PTA in December 2010. FAB verified illegal use of spectrum by PTCL and PTA after conducting series of hearings, imposed a fine of Rs. 82 million on PTCL in September 2011. PTCL challenged this order of PTA in Islamabad High Court (IHC) and obtained a temporary stay order dated 10 November 2011 with noting that “this order shall not inure unless specifically extended on the next date of hearing”.

 PTA did not pursue the case in IHC nor filed an appeal against this interim stay order which has led to continued illegal use of 3G spectrum by PTCL even as of today. PTA’s procrastination over this blatant and continued violation of law by PTCL is also resulting in a discriminatory regime for all other broadband operators who have paid millions of dollars of costly spectrum as legitimate fees whereas PTCL has been given a free hand to use extra spectrum without paying any fee or following the process of competitive bidding.

 This act of PTCL is seriously hurting all other broadband operators, particularly, WiMax and future 3G operators who are expected to pay minimum of US$300 million for spectrum. On one hand, PTCL has successfully manipulated the Government to delay the auction of 3G spectrum under garb of a clandestine agreement between Government of Pakistan and Etisalat to enforce a moratorium on issuing new licenses for seven years at the time of PTCL’s privatization, and on the other hand, it is using a scarce and very costly 3G spectrum without paying any license fee and circumventing competitive bidding.

 The injunction order of IHC is against the Enforcement Order dated 16 September 2011 of PTA and in no way allows PTCL to continue theft of spectrum, keep robbing the national exchequer and annihilating its competitors by gaining extra spectrum at no cost. ISPAK demands immediate action by PTA to stop the continued theft of national spectrum, recover the cost of spectrum and impose penalty on PTCL for this blatant violation.

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