In an environment of rapid technological transformation in the telecommunications sector and to further facilitate Ease of Doing Business, regulator TRAI yesterday suggested reducing entry fees across various license authorizations and the merging of bank guarantees.

It is expected that reductions in entry fee will lead to the entry of new service providers in the market, increase investment and enhance competition in telecom sector, the Telecom Regulatory Authority of India (TRAI) said while releasing recommendations ‘Rationalization of Entry Fee and Bank Guarantees’ in the telecoms sector.

“The merging of bank guarantees will encourage ease of doing business and enable licensees to make investments in the sector thereby ushering the growth in the sector. Both these measures will improve the quality of service and enhance consumer welfare,” the regulator stated.

TRAI has also recommended doing away with the entry fee at the time of renewal of license. Such a move will ease the financial burden on existing, as well as new entrants, and will be beneficial for UL (VNO) licensees especially, it justified its suggestions to the government.

The salient features of the recommendations are as follows:

# Entry fee should be reduced from the present levels for Unified License (UL) and Unified License (Virtual Network Operator, UL (VNO) licenses.# No entry fee for M2M audio conferencing/audiotex/voice mail service, ISP “C” recommended.

# Entry fee for following UL authorizations should be rationalized:

1. a) Access service: from Rs 1 crore to Rs 50 lakh for each telecom circle/

metro area; from Rs. 0.5 crore to Rs. 25 lakh for J&K and North-east areas.

2. b) NLD and ILD: from Rs 2.5 crore to Rs 50 lakh.
3. c) PMRTS: from Rs. 50,000 to Rs. 20,000 for each telecom circle/ metro area.
4. d) ISP “B”: from Rs. 2 lakh to Rs. 50,000 for each telecom circle and Rs. 25,000 for J&K and North-East each.

1. e) ISP “A”: from Rs. 30 lakh to Rs. 10 lakh.

# The entry fee for UL (VNO) authorizations reduced substantially to promote competition and improved provision of services.

# There should be no entry fee at the time of renewal of licenses.

# For Unified License, financial bank guarantee (FBG) and performance bank guarantee (PBG) should be merged into a single bank guarantee for securitizing the dues, to cover the violation of license conditions and to ensure the performance under license agreement.

# Similarly, for mobile number portability license, FBG and PBG should be merged into a single bank guarantee.

# For enhancing the ease of doing business, the process for submission of electronic bank guarantee should be adopted.