ISLAMABAD
The federal government has notified the base prices and spectrum volumes for the auction of next generation mobile services (5G) A formal policy directive has been issued via the Ministry of Information Technology and Telecommunication after approval by the auction supervisory committee, chaired by Finance Minister Muhammad Aurangzeb.
The policy states that the spectrum fee will be reflected in the licence in equivalent Pakistani rupees, with the US dollar to Pakistani rupee conversion based on the National Bank of Pakistan (NBP) TT selling rate prevailing on the day preceding the auction date. Under the directive, the Pakistan Telecommunication Authority (PTA) will conduct the auction through a transparent and competitive process, covering six spectrum bands.
The auction will include 15 MHz of paired spectrum in the 700 MHz band, 36 MHz of paired spectrum in the 1800 MHz band, 20 MHz of paired spectrum in the 2100 MHz band, 50 MHz of unpaired spectrum in the 2300 MHz band, 190 MHz of unpaired spectrum in the 2600 MHz band, and 280 MHz of unpaired spectrum in the 3500 MHz band. The base price for 1 MHz paired spectrum in the 700 MHz band has been fixed at $6.5 million.
For the 1800 MHz and 2100 MHz bands, the base price for 1 MHz paired spectrum has been set at $14 million each. In the case of unpaired spectrum, the base price has been fixed at $1 million per MHz in the 2300 MHz band, $1.25 million per MHz in the 2600 MHz band, and $0.65 million per MHz in the 3500 MHz band.
Under the notified payment terms, a one-year moratorium from the date of licence issuance will apply, during which no payment or markup will be payable. Upon completion of the moratorium, licensees may either pay 100% of the spectrum fee by the first anniversary of licence issuance or opt for a deferred payment plan.
Under the deferred option, at least 50% of the total spectrum fee must be paid by the first anniversary, while the remaining 50 per cent will be payable in five equal annual instalments starting from the second anniversary. The deferred amount will carry a cumulative markup at the rate of one-year KIBOR plus three per cent per annum, with the applicable KIBOR determined as per the rates prevailing on the relevant payment dates, as published by the State Bank of Pakistan.
Early repayment of the outstanding balance, in full or in part, will be permitted without any prepayment penalty, though markup at the prescribed rate will apply up to the date of final payment.
