Home >Industry >Telecom >Telecom firms get two more weeks to cease operations

New Delhi: The Supreme Court on Monday stayed the cancellation of 122 telecom licences allocated to nine companies and set to be enforced by 18 January, extending the deadline for the operators to cease operations by two weeks.

The so-called second generation (2G) licences were due for cancellation after the court’s 2 February, 2012 verdict that the process of allocating the licences and 2G spectrum in 2008 was flawed. The companies were given time till the completion of an auction of the spectrum to wind up operations. The auction ended on 14 November.

The nine companies can now continue operations until 4 February, the next date of hearing of the case.

The stay was ordered after the government proposed that the operators be allowed to continue operations until March, when an auction of unsold spectrum is to be held.

The court also asked the government to inform it about the reserve price of spectrum for the auction on 11 March.

On 27 November, the court had said all operators that continued services beyond four months after licences were cancelled will have to pay an additional fee, but did not specify an amount.

Some 45% of the 1800 megahertz (MHz) spectrum on sale was bid for in the auction, with only five bidders participating. Only two of the new operators that lost licences took part in the auction and succeeded in winning spectrum in six circles out of the 22 where they lost licences.

The CDMA (800MHz) spectrum auction was cancelled as there were no applicants due to a high base price of 18,200 crore for 5MHz of spectrum across the country.

Airwaves in the 1800MHz and the 900MHz bandwidth of the GSM spectrum will be auctioned first, followed by the auction of the CDMA airwaves in the 800 MHz bandwidth.

The cabinet has cut the reserve price in the unbid cirlce by 30% and is expected to approve a proposal by an empowered group of ministers to cut the reserve price of CDMA spectrum by as much as 50%.

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