Home / Industry / Telecom /  Extra fee for only shared spectrum

The Telecom Regulatory Authority of India (Trai) on Monday clarified that the additional spectrum usage charge (SUC) of 0.5% of the adjusted gross revenue (AGR) will be applicable to airwaves that have been shared by two telecom operators and not to the entire spectrum holding of a licencee.

For instance, in the case of Reliance Jio Infocomm Ltd, which has been using Reliance Communications Ltd’s spectrum in the 800 megahertz band under a sharing agreement since 2016, both Reliance Jio and RCom will have to pay an additional 0.5% SUC on the airwaves shared and not on the other bands they hold.

“It is clarified that as per the existing spectrum-sharing guidelines, an increment of 0.5% on spectrum usage charge rate should apply on the spectrum holding in a specific band in which sharing is taking place, and not on the entire spectrum holding (all bands) of the licencee," Trai said in its recommendations on the ‘methodology of applying spectrum usage charges under the weighted-average method of SUC assessment, in cases of spectrum sharing’.

Trai also suggested that two telecom operators in a spectrum-sharing agreement should have the flexibility to exit the clause, which should be mentioned in spectrum sharing guidelines.

“To provide flexibility to the TSPs (telecom service providers) to manage their spectrum on need and commercial basis, suitable exit clause for intimation of termination of an existing spectrum-sharing arrangement by the involved TSPs should be included in the spectrum sharing guidelines," it said.

Meanwhile, the Supreme Court wants to understand the details of the spectrum sharing pact between Reliance Jio and RCom. The apex court on Monday asked Jio whether it should be held liable for paying AGR dues of RCom as India’s largest telecom operator has been using the bankrupt telco’s spectrum since 2016.

However, Jio, in a written submission on Monday, told the apex court that there is no legal basis for transferring bankrupt RCom’s dues, AGR or otherwise, to Jio as the two telecom operators are in a spectrum-sharing agreement and do not share liabilities.

“Jio is unlikely to be impacted as most (AGR) dues of RCom are prior to the spectrum sale...ownership and rights of spectrum in case of spectrum sharing are not transferred, and RJio has been paying spectrum usage charge for the shared spectrum, in keeping with the regulations," Axis Capital Ltd said in a report.

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