New Delhi: The department of telecommunications (DoT) late on Friday issued the much-awaited notice inviting applications from potential bidders for the coming auction of 2G telecom spectrum.
The notice lists all the rules and regulations governing the auction and is considered the only legally binding document regarding the auction.
Potential bidders have until 19 October to submit applications. DoT will publish ownership details of bidders on 21 October. By 28 October, DoT expects to have a list of pre-qualified bidders and a mock auction is expected to start on 7 November. The actual auction is expected to start on 12 November.
The notice lists the eligibility criteria for bidders, the auction rules and the frequencies that are up for auction.
To increase the number of bidders and ensure that no spectrum remains unsold, DoT is also likely to raise the number of slots of top-up spectrum to be allotted to new operators. Top-up spectrum refers to slots that only new operators can bid for if they are unable to get the minimum 5MHz of spectrum needed to start operations in the country.
As per the information memorandum issued by DoT on 27 August, the government will first auction spectrum in the 1,800MHz band and once that concludes will begin the auction process for 800MHz after two days. DoT will auction a minimum of eight blocks each of 1.25MHz (10MHz of 1,800MHz) in all the 22 telecom circles in the country and another three top-up blocks.
A new entrant will have to win a minimum of four blocks of spectrum in a service area to start business in India. Existing telcos will be allowed to bid for up to two blocks of 1,800MHz spectrum and one block of 800MHz spectrum. Delhi and Mumbai have only eight blocks of spectrum in 1,800MHz available while the rest of the country has the necessary 11 blocks, as per the DoT notice.
After much deliberation by an empowered group of ministers headed by finance minister P. Chidambaram, the cabinet fixed the base price of Rs.13,999.96 crore for 5MHz of pan-India spectrum in the 1,800MHz band and Rs.13,649.97 crore for 3.75MHz of 800MHz spectrum.
The operators who might have to pay penalties for implementing 3G intra-circle roaming have asked for DoT to hold a pre-bid conference after the publication of the notice. This is because in the pre-bid conference held for the 3G spectrum, DoT had said it would allow all roaming that is allowed in the telecom licence, as part of its clarifications. However, in court, after sending notices to the telcos asking them to stop their 3G intra-circle roaming arrangement, DoT said the clarification was not legally binding. “There has to be a meeting where the clarifications are legally binding,” a senior executive with one of the affected telcos said, requesting anonymity.
The February 2 Supreme Court ruling cancelling 122 telecom licences allocated to nine companies gave the government till 2 June to complete the auction of the spectrum and licences. The government was able to get two extensions of the deadline with the latest being 11 January 2013, by when DoT has to allocate the spectrum. Failure to do so will invite contempt action against erring officials by the court. Companies that lost their licences have till 19 January to operate.