NTA bid to regulate cross-holding

KATHMANDU, DEC 14 - 2012

The Nepal Tele-communications Authority (NTA) has been working on a new rule to manage and regulate cross-holding by telecom companies. Cross-holding is a situation where a public company owns shares in another public company.

A committee under the coordination of former law secretary Madhav Paudel is putting the final touches to the regulation. It has been charged to recommend whether the government should allow cross-holding or not and why. The panel, which includes Nepal Rastra Bank executive director Bhaskar Mani Gyawali and Kailash Prasad Neupane of the NTA, has also been asked to advise the telecom authority how it should regulate cross-holding among its licensees, if it were to be allowed. The committee has been consulting economic experts like former finance secretary Rameshwor Khanal regarding the cross-holding provision.

“Our report is almost ready, and we will submit it to the NTA board soon,” said Neupane, member secretary of the committee and spokesperson of the NTA. He added that, based on a study of the existing provisions and laws, a few amendments needed to be made to the rules and regulation related to telecommunications to oversee cross-holding.

The issue of cross-holding in the telecom sector arose after Swedish-based TeliaSonera, the parent company of Ncell, acquired shares of Nepal Satellite Telecom (NST) about eight months ago. TeliaSonera had indirectly acquired NST shares through its subsidiary TeliaSonera Asia Holding BV. Reports said that TeliaSonera Asia had bought a 49 percent stake in Cypriot holding company Airbell Services which owns 75 percent of NST.

Meanwhile, TeliaSonera has been saying that it was very typical for it to have more than one brand in the market. During a visit to Nepal in August, Lars Nyburg, president and CEO of TeliaSonera, stated that they had invested in NST to expand services with a focus on rural areas. In July, NST signed a contract with Chinese telecom equipment vendor ZTE Corporation to extend its telecom service to the Western and Far Western regions.

After TeliaSonera invested in Ncell and NST, the NTA board had formed the committee in April to prepare a report on cross-holding and its regulation within a month. However, the committee fell behind schedule due to the demise of Paudel’s father, resignation of the NTA chairman and festival holidays, according to NTA.

Source: The Kathmandu Post

Nepal Satellite Telecom will focus on rural areas: TeliaSonera

KATHMANDU, AUG 28, 2012

TeliaSonera, the parent company of Ncell, has said its investment in Nepal Satellite Telecom (NST) is aimed at delivering better telecom services at lower costs.

Addressing a press conference here on Monday, TeliaSonera President and CEO Lars Nyberg said NST would focus on rural areas. Nyberg, along with other top TeliaSonera officials, were in Nepal to give a boost to its telecom business, including the new NST venture. TeliaSo-nera recently indirectly acquired NST through its subsidiary TeliaSonera Asia Holding BV. TeliaSonera Asia bought 49 percent stake in Airbell Services which owned 75 percent stake in NST.

During their one-day stay in Nepal, Nyberg and his team met top political leaders. According to Nyberg, TeliaSonera will explore legal and technical possibilities on sharing infrastructure of both the operators—Ncell and NST—for service expansion.

With NST’s acquisition, TeliaSonera now has two brands in Nepal. According to Nyberg, it is very typical for TeliaSonera to have more than one brand in a market. “I think this is a sign of market maturing,” said Nyberg. Norway, Sweden and Estonia are the other countries where the company has more than one brand.

On concerns that TeliaSonera’s investment NST may create monopoly, TeliaSonera Eurasia President Tero Kivisaari, said: “We are not creating a monopoly.”

“We understand and have full respect we will have competition in the telecom market. We believe competition is the best way to ensure good quality and have affordable prices for the population,” Kivisaari added. “Our ambition is not to have 100 percent market share in Nepal.”

According to TeliaSonera, NST will be a complementary asset for Ncell. Kivisaari added it is a must for NST to offer good quality at competitive price and maintain a good image among customers.

TeliaSonera, however, did not unveil any big plan for NST’s expansion. It said it will first concentrate on reaching areas outlined by the government in the operating licence of NST.

NST last month signed a contract with China’s ZTE Corporation for network expansion and is also planning to relaunch its Hello Nepal brand.

Source: The Kathmandu Post