PM to decide fate of Citycell

The prime minister will take a final decision on shutting down Citycell after a meeting with the telecom regulator tomorrow, when the issue will be discussed, two government functionaries said yesterday.

Bangladesh Telecommunication Regulatory Commission will take all necessary steps to revoke Citycell's spectrum and permission to use radio equipment, Shahjahan Mahmood, the regulator's chairman, told The Daily Star.

BTRC formed a committee to take the necessary steps in connection with Citycell.

On July 31, BTRC issued a public notice and asked Citycell's subscribers to switch to other operators by August 16, as the telecom regulator has decided to cancel its spectrum for failure to pay Tk 477.51 crore in dues despite several reminders.

"After a written directive from the telecom division, we have issued a public notice and now everything depends on the final decision, which may come from the meeting," said Mahmood.

Meanwhile, State Minister for Telecom Tarana Halim said they need more time to review the situation.

"The prime minister is the telecom minister and the cancelation of any licence will be unlawful without her approval," she said.

Senior officials of the telecom division said the government appears to have softened on its stance to revoke the licence.

"It seems Citycell may get additional time to protect its business operation," said a senior official, asking not to be named.

In a letter to the regulator on August 1, the country's lone CDMA operator Citycell sought time until December 31 to clear its outstanding charges. BTRC forwarded the letter to the telecom division, which is now under consideration, said officials.

The telecom regulator issued a public notice asking Citycell subscribers to switch to other operators without following the due process, said Tarana.

Officials of the telecom division said the law has given the government enough powers to shut down any operator's operations, but the regulator must follow the due procedure.

"The BTRC didn't inform us about the public notice before it was issued," said a senior official of the telecom division.

In its notice published in the media, BTRC said the dues include spectrum renewal fees at Tk 229 crore, annual licence fees of Tk 10 crore, annual spectrum fee of Tk 27.14 crore, VAT of Tk 39.92 crore and late fee of Tk 135 crore.

Earlier in April, BTRC filed a case against the operator under the Public Demand Recovery Act to realise the dues.

Citycell began its operations in 1993, though its licence was awarded in 1989.

Singapore's SingTel owns 44.54 percent shares in Citycell, Pacific Motors 37.95 percent and Far East Telecom 17.51 percent.

Shareholders have been trying to sell the company for the last few years, but they did not find any interested party.

Citycell has been a minor player in the market for at least 10 years, and had around 7.02 lakh active customers until June, according to BTRC.

The operator reached 19 lakh customers in 2011 but it could not maintain its position in the last few years.

Citycell's stakeholders, including SingTel, have been looking to sell the company but have been unable to find buyers, London-based BMI Research said in a report on August 2.

In November last year, BIM Research also said that rising operational risks and overhead costs would be key threats to smaller operators' service continuity prospects, and this development could see this view playing out sooner than expected.

"Its CDMA spectrum in the 800MHz band can be repurposed for 3G or 4G use, which can support data transmission over longer distances and will be useful in supporting rural coverage."