Nepal’s telecoms watchdog orders NT to pay royalty fees

19 Jun 2012

The Himalayan News Service reports that the Nepal Telecommunications Authority (NTA) has ordered state-owned incumbent fixed and mobile operator Nepal Doorsanchar Company Limited (Nepal Telecom, or NT) to pay off its outstanding royalties of NPR3.27 billion (USD38.6 million). NTA spokesperson Kailash Prasad Neupane says the unpaid fees cover the telco’s fiscal years 1998/99 to 2010/11, adding that whilst it had been paying a rate equivalent to 4% of its total annual income as a royalty, it should be paying the full committed amount. Neupane went on to say that NT must pay the balance by the end of its current financial year.

It is understood the government’s decision to get tough with public enterprises over non-payment of royalties stems from an earlier warning from the Ministry of Finance over the alarming ‘shortfall of non-tax revenue mobilisation’.

In a related matter, earlier this month the government ordered the NTA to accelerate the collection of unpaid radio spectrum fees from local mobile network operators. As reported by TeleGeography’s CommsUpdate, following a recent court case that upheld that the cellcos should make full payment on the spectrum fees due, the NTA was instructed to seek NPR710 million and NPR350 million from NT and Spice Nepal Private (Ncell), respectively. To date NT has only paid NPR100 million of the NPR810 million spectrum fees it owes, and still argues that it should not have to pay them as its licence was awarded under an earlier Radio Act. However, the NTA has countered that under the Telecommunications Act, all cellcos are obliged to pay for spectrum allocations they hold.