3 mobile operators raise concern over ownership cap, send letter to CA

Parent companies of the country’s three private mobile operators—Telenor, Axiata, and VEON—have sent a letter to Chief Adviser Professor Muhammad Yunus expressing concern over the draft policy on reforming the telecommunications network and licensing system.

The draft, proposed by the Bangladesh Telecommunication Regulatory Commission (BTRC), stipulates the maximum limit for foreign ownership in mobile opearators to be 80 per cent.

The companies in their letter to the Chief Adviser stated that such a policy would reduce confidence in foreign investment.

BTRC is a body under the Post and Telecommunications Division, which is under the Chief Adviser Muhammad Yunus. On 3 July, Telenor Asia’s head Osmund Revhaug (parent company of Grameenphone), Axiata Group CEO Vivek Sood (parent company of Robi), and VEON Group CEO Kaan Terzioğlu (parent company of Banglalink) wrote the letter to the Chief Adviser.

After the formation of the interim government in August last year, steps were taken to reform the telecommunications sector. As part of this, an initiative was taken to reform the 2010 International Long-Distance Telecommunications Services (ILDTS) policy.

For this purpose, the first draft of the “Telecommunications Network and Licensing Reform Policy 2025” was published last April. On 30 June, the Post and Telecommunications Division prepared a revised version of this draft.

The revised draft states that foreign ownership of mobile operators can be up to 80 per cent, and local ownership must be at least 20 per cent. The parent companies of the country’s three private mobile operators expressed concern over this issue in the letter.

They stated in the letter that they welcome the government’s reform initiatives and view BTRC’s efforts positively. However, if some of the new proposals included in the draft of the Telecommunications Network and Licensing Reform Policy are implemented, they will create obstacles to both current and future investments in the country’s telecom sector.

The letter stated that to set a maximum limit of 80 per cent foreign ownership for mobile operators and to apply it to current license holders is a matter of deep concern.

The letter also mentions that the draft proposes a change in the existing 55 per cent of ownership cap for other digital infrastructure-based operators, which is also a cause for concern.

Telenor, Axiata, and VEON said in the letter that Bangladesh’s telecom sector has so far benefited from an open and supportive foreign ownership policy. This has maintained investor confidence.

However, the proposed policy will reduce trust in foreign investment, which contradicts the interim government’s efforts to attract global investment.

Imposing limits on foreign ownership at any level will be detrimental to the sector’s potential growth. In the proposed new licensing framework, the scope of mobile operators has been reduced compared to before.

Rights to fiber connections and international SMS transmission have been unilaterally granted to third parties, which reflects an excessively strict and interventionist regulatory approach. This directive could increase spending in unproductive sectors for mobile operators. At the same time, it will have a serious impact on the entire digital ecosystem.

Telenor, Axiata, and VEON have called for discussions with all stakeholders in the sector regarding the draft policy. They said in the letter that this policy will have long-term implications. If implemented incorrectly, it will not only affect foreign investment but also pose a challenge to achieving the country’s overall social and economic goals, the letter adds.