Critical day for Grameenphone

The long drawn-out legal battle between Grameenphone and the telecom regulator over unpaid dues amounting to Tk 12,580 crore has reach a critical junction.

The mobile network operator's review petition, in which it sought permission to pay Tk 575 crore in instalments against dues, is scheduled to be held today. The appeal is number 182 on the Supreme Court's cause list, said officials related to the process.

"There is hardly any chance to present the issue before the Supreme Court as it is far behind on the cause list," said a legal counsellor of Grameenphone requesting anonymity.

After exhausting all other options, the country's leading mobile operator, yesterday offered Tk 100 crore to the Bangladesh Telecommunication Regulatory Commission (BTRC) to continue negotiations on the contested audit claim. But the regulator declined the amount.

At the same time, the BTRC is also making preparations to appoint a panel of administrators who will run Grameenphone's operations should the network provider fail to pay Tk 2,000 crore in accordance to an order from the Appellate Division that came in November 24 last year. The deadline for the payment is February 24.

If Grameenphone fails to pay within the stipulated date, BTRC will move to appoint administrators, said officials of the telecom watchdog requesting anonymity.

"It is tough to predict what could happen if the court does not hear the matter," said the legal counsellor of Grameenphone.

To expedite the process of appointing an administrator, BTRC Chairman Md Jahurul Haque has met with Prime Minister Sheikh Hasina at her office on Monday and discussed a few potential candidates.

Haque acknowledged the episode to The Daily Star yesterday.

"We discussed several options on who can come on the administrators' panel."

But before the panel is finalised, the BTRC will hold discussions on the matter with industry experts and top government policy makers.

"We do not intend to embezzle from Grameenphone. Rather, we want to collect public money. The administrative panel's main responsibility will be to realise the amount."

The administrator will enjoy full authority over hiring and firing of employees just as a chief executive officer would, while their remuneration will be similar to the company's top brass, he added.

The telecom regulator is also considering including retired civil and army bureaucrats alongside legal and finance experts and engineers on the panel.

About declining Grameenphone's offer of Tk 100 crore, Haque said the telecom regulator cannot receive any payment on the matter at this stage since the review petition hearing is scheduled for Thursday.

"Grameenphone went to the court, not us. Now as the matter is pending in a legal process we will wait until it ends. After the court's decision, we will take our next step," he added.

"It will take a long time to solve the problem in the court and as a part of the previous initiative to settle the issue outside of the court, we offered the sum," said Hossain Sadat, director and head of regulatory affairs, Grameenphone.

Grameenphone has full confidence in the legal system but made the offer to expedite an out-of-court settlement, he added.

After completing an audit of Grameenphone, the BTRC in 2016 claimed that the joint venture between Norway's Telenor Group and Grameen Telecom Corporation owed them Tk 12,579.95 crore in taxes, revenue share, spectrum charge and late fees accumulated over years.

The BTRC's claim was broken down as follows: the principal claim was only Tk 2,299 crore while Tk 6,194 crore was due in late fees and another Tk 4,086 crore was payable to the National Board of Revenue.

Following several initiatives were taken by both sides to open discussions, Grameenphone went to court on the matter and received an interim stay order.

After the BTRC lodged an appeal against the order on November 24, the Appellate Division asked the network operator to pay Tk 2,000 crore within three months if they want the stay to continue.

On January 26, Grameenphone filed another review petition asking permission to pay Tk 575 crore to the telecom regulator as an adjustable deposit over a 12-month period. This meant that the carrier would pay Tk 47.92 crore each month.

GP'S ATTEMPT TO NEGOTIATE AUDIT FAILS

Just a day ahead of their review petition hearing, Grameenphone yesterday offered Tk 100 crore to BTRC.

"We offered Tk 100 crore to show our willingness for negotiation. The BTRC did not accept our offer," Shahdat Hossain, director and head of regulatory affairs of Grameenphone, told reporters during a press meet at the Pan Pacific Sonargaon Dhaka Hotel, adding that the company was always willing to resolve the dispute through discussions.

Asked why the company did not respond to the government's request to deposit an amount to continue negotiations three months ago, he said: "We were ready for it and working on formulating an agreement so that we could pay some of the amount in an official manner."

"Through the media reports we came to know that government is set on appointing new administration at Grameenphone. To save the interest of our investors, we had to rush to the court," he added.

The BTRC ran its first audit of Grameenphone back in 2011 and found financial discrepancies amounting to Tk 3,034 crore in the operator's books from its inception in 1996 through March 2011.

Grameenphone then disputed the appointment process of the auditing firm and after a court ruling the BTRC in October 2015 appointed another firm, Toha Khan Zaman & Co, to run a fresh audit on the network operator's books from its inception till June 2015.

The methodology in the particular issue of the BTRC were questionable, said Grameenphone officials.

In July last year the telecom regulator temporarily slashed Grameenphone's bandwidth by 30 per cent and also topped giving approval to the operator to roll out new packages or services, or import network equipment to pressure them into clearing their dues.