KATHMANDU, Aug 13: The government has decided to renew the license of Ncell, a private telecommunication service provider in Nepal. Ncell will pay Rs 20 billion in installments for the renewal fee owed to the Nepal Telecommunication Authority.
As Ncell's 20-year license expires on Saturday, a cabinet meeting held on Thursday decided to renew the license with conditions. A cabinet minister, speaking on condition of anonymity, told Republica that the dues owed by Ncell would be paid in four installments, along with 10 percent interest.
On May 27, three months before the license expired, Ncell paid Rs 4 billion out of the Rs 20 billion renewal fee and applied for installment payments for the remaining amount.
Ncell is now legally allowed to operate mobile services for the next five years. The company claimed that it would be unlawful if the government nationalized Ncell after 25 years and did not allow the company to buy or sell shares or change its structure before that period.
NTA instructs Ncell to pay Rs 19 billion, warns of revoking lic...
The government was accused of not treating Nepal Telecom and Ncell equally by delaying Ncell's license renewal. The cabinet granted the installment facility as per Section 20 of the Telecommunications Act, which provides that the authority can give necessary instructions regarding the diversification, expansion, and regularization of telecommunication services.
On August 22, the NTA informed the ministry through a letter that Ncell had requested an installment payment facility.
The government inquiry committee has submitted a report on the recent share buying and selling process, although the dispute over the sale of shares remains unresolved. The Telecommunications Act states that the ownership of land, buildings, devices, equipment, and structures of telecommunication service providers with more than 50 percent foreign investment will be retained by the government after the 25-year license period expires. If the foreign investment is less than 50 percent, the government will not retain ownership of such property.
The government has restricted the rights granted by law and requested a halt to the buying and selling of shares before renewing the permit. This was contrary to the provisions of the Telecommunication Service Provider's Property Management Regulations, 2079.
According to Rule 6 of the regulation, the property that remains in government ownership after the permit period expires cannot be mortgaged, sold, or transferred in any way without the approval of the authority for at least three years before the permit expires.
Ncell, whose mobile service license expires on August 29, 2029, will not be able to sell its assets or shares after August 31, 2083, but the existing law does not prohibit such actions before that date.
Recently, the telecommunication company's business has declined. Both Ncell and Nepal Telecom have experienced continuous revenue declines every year due to the impact of OTT services. The decline in international incoming calls has not been offset by the increased demand for data, resulting in a 25 percent decrease in revenue over the last five years. The data consumption per month of Nepali subscribers is only 4.5 GB, compared to 20 GB in India. Previously, both Ncell and Nepal Telecom contributed 5% to Nepal's GDP from the telecommunication sector; now, it is only 2%.
As a major taxpayer, Ncell has paid more than Rs 320 billion in revenue to the government in the form of taxes and non-tax contributions since its inception in the fiscal year 2080-81. In the fiscal year 2024/25 alone, the company has paid more than Rs 20 billion in various taxes and charges. Ncell has also contributed more than Rs 2 billion under corporate social responsibility initiatives in various fields, including education, environment, and health.
