KATHMANDU, April 17: While the Nepal Telecommunication Authority (NTA) has advanced the process of asset management to take ownership of Smart Telecom Company by the government, Ncell has prepared to buy it at the price of scrap value. After the government took ownership of Smart and started the auction process, Ncell started the bid to extend its service period by participating in it. It is said that Ncell is in the strategy of buying the telecommunication service provider company Smart Telecom Company and not transferring ownership to the government by extending its deadline.
An official of the Ministry of Communication said that after the Ministry of Communication and Information Technology introduced the Property Management Regulations, 2079 BS for telecommunication service providers that do not have valid licenses, Ncell is in such a dilemma. "Ncell, which will come under the ownership of the government after six years, is trying to extend the period in any way. If there is opposition to the law, Ncell is trying to take ownership of Smart and thereby extend the period," said the official. According to that official, the regulation published in the gazette on December 5, 2022 has facilitated Ncell. "The main purpose of bringing the regulations is to transfer Smart's assets to Ncell easily through auction," said a ministry source. The NTA took control of the Smart Telecom Company and selected a five-member management group headed by board member Gokarna Sitaula to operate the service. Now that group is working.
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"The process of taking ownership of Smart Telecom has started," said Purushottam Khanal, chairman of the NTA. In the first phase, the Authority has made a regulation to invite global tenders for international companies for the auction and if they do not participate, Nepali companies Nepal Telecom and Ncell Nepal will be allowed to participate in the auction in the second phase.
With this, an environment has been prepared for Ncell to take over Smart Telecom Company. "If no company participates in the global tender, the provision that the existing service provider companies providing services in Nepal will also participate in the second round of the tender will be implemented," said the ministry source.
According to Khanal, chairman of the NTA, Smart's license has been legally revoked since Sunday. The authority has already started the process for managing Smart's assets. After completing all the procedures, it is taken to the auction. Initially a global tender is called. If no company participates, Nepal Telecom and Ncell can participate in the second phase," he said. In that case, sources claim that preparations have been started for Ncell to buy Smart. With this, after 25 years of the license, Ncell, which will come under government ownership, will get the facility to run independently for another 10 years. Smart's license period is till 2038 BS. The company owes 27 billion rupees to the government. In such a case, the government has to sell it by auction through global bidding. But in the recently made regulation, when there is no foreign application, the domestic service providers can participate in the auction, so the situation has come to be a benefit for Ncell. "In the situation where the provisions of the Telecommunications Act cannot be removed, Ncell's strategy of working from this regulation was seen. The main purpose of bringing this regulation in November is to transfer Smart's property to Ncell," the source said.
Ncell’s period is ending on August 31, 2029. He wanted to own Smart back then. It wants to acquire Smart Telecom before that. The regulation to facilitate this purpose was brought during the term of the then Minister for Communication and Information Technology, Gyanendra Bahadur Karki. More dishonesty has been done by shutting down the services of Smart after the company failed to pay billions of rupees to the government. But the authority issued a notice a few days ago not to stop the service. Smart owes about 27 billion rupees to Nepal Telecommunication Authority for license renewal, frequency fee, royalty, and fines. Smart Telecom owns 50 percent of Lalsahu Holding Limited Sales, 30 percent of Kosovo Investment Limited Sales and 20 percent of Square Network Pvt Ltd of Nepal. According to the authority's latest report, Smart has about 2.4 million 4G subscribers.
Smart Telecom was established on July 1, 2008 and has been providing services since then. It got an integrated license in 2013. After Smart failed to pay its dues, the NTA decided to revoke its license on August 30, 2019. But after the government overturned the authority's decision, Smart got the operating permit. At present, the government has not taken any decision. "Leaders of political parties are moving towards not extending the deadline of Smart and facilitating Ncell," said the source. The Ministry of Communications has prepared a draft to amend the Telecommunications Act to make it easier for Ncell. Discussions have now been stopped after the continuous publication of news about the draft by Republica. The provisions in the draft are in favor of Ncell. During the drafting of the amendment, there was opposition to the Telecommunication Act, 1997, when it tried to remove the provision that the telecommunication service provider company would come under the ownership of the Government of Nepal after 25 years. "If the road to the law is blocked, Ncell is trying to prevent it from coming under government ownership by using the regulations and by adopting stealth," said a source at the Ministry of Communications.
