Conspiracies being hatched to entrust Smart Telecom to Ncell

KATHMANDU, April 22:The license revocation process of Smart Telecom, initiated by the Nepal Telecommunication Authority, has been stalled for some time. The process has been stalled after the Patan High Court issued a short-term interim order not to implement the decision to cancel the license of Smart Telecom.

“A writ petition has been filed in the court in a planned manner. The Nepali associate of Ncell and the owner of Smart Telecom are from the same family. By filing a writ petition in the court, a conspiracy is being hatched to delay the process of revoking Smart's license and to ultimately help Ncell," a source told Republica requesting anonymity.

“High political leadership is involved in this. Preparations are being made to hand over Smart Telecom to Ncell at a price of scrap value,” added the source.

The writ petition filed by Smart Telecom on Tuesday was the second such petition filed at the high court after the court initially denied issuing an interim order.

“It is clear that there is something fishy because the interim order has been issued after two writ petitions were filed on the same matter,” said the source.

Smart Telecom filed the first writ petition in the Patan High Court in the last week of March after the government hinted that the license would be revoked. The government had decided to cancel Smart Telecom's license and take control of the property as the company did not show any interest to renew the license.

The license renewal date of Smart Telecom expired on April 16. After the date expired, the authority was preparing to call a global tender when another writ petition was filed in the high court on behalf of Smart Telecom.

After the preliminary hearing on the writ petition, the Patan High Court has called both the plaintiff and defendant for a discussion on Friday. There has also been an interim order not to revoke Smart Telecom's license until the case is settled.

NTA had decided to revoke the license of Smart Telecom on April 17 after non-payment of about Rs 30 billion dues for operating permits and renewals until April 16.

The cancellation of the license of Smart Telecom should have automatically transferred the ownership of the company to the government had the court not intervened.

The rules were changed in mid-December so that Smart would be taken over by Ncell. According to the plan, Ncell participated in the second round of tender to take the ownership of Smart Telecom.

There is a legal provision that all telecommunication companies including Ncell will automatically come under the government after 25 years of getting the operating license. In the case of Ncell, the date is September 1, 2029. Sources claim that the regulations have been changed to prevent Ncell from coming under the ownership of the government.

"The regulation has been amended in a bid to push Ncell’s service period, which is coming under government ownership after six years,” said a source at the Ministry of Communications and Information Technology. "One of the purposes of revising this regulation is to transfer Smart's property to Ncell easily through auction," the source further stated.

Ncell's Nepali associate Satish Lal Acharya and the owners of Smart Telecom are also from the same family, so attempts are being made to stall the license revocation process. At present Sunivera Company of Acharya owns 20 percent stakes in Ncell while the remaining 80 percent shares are held by the Malaysian telecom company Axiata.

Lal Sahu Distributors Pvt Ltd Singapore has 70 percent stake in Smart Telecom, Gillette has 10 percent and Sachin Lal Acharya's Square Network Pvt Ltd has 20 percent shares. The Acharya brothers each have shares in one of the two telecom companies.

After April 17, Smart Telecom went into the auction process according to the Asset Management Regulations of Telecommunication Service Providers, 2079 BS, but the process has been stalled after the court order.

"We are waiting for the final decision from the court," said Purushottam Khanal, chairman of NTA.

According to the Telecommunication Act, 1997 and the Asset Management Regulations of Telecommunication Service Providers, 2079 BS, the Authority had initiated the auction process of Smart Telecom's assets. In order to proceed with the auction process, the authority said that it will call for a global tender in the first phase and if no one is involved in it, it will issue a second-phase tender.

In the second phase, Nepali companies are allowed to bid for the tenders. Based on the same regulation, Ncell is trying to get Smart's license and extend its license till the year 2095 BS, the source claims.

Sources claim that Satish Lal Acharya and Sachin Lal Acharya, who have political influence in the telecommunication sector, hold telecommunication licenses in countries from Nepal to Africa. According to the Telecommunications Act, the same company cannot do business by engaging in two companies through cross holdings. But the Acharya brothers have internally invested in Smart Telecom. Similarly, they have purchased shares in Ncell in the name of their family members and have cross holdings.