Bharti suggests right of first refusal for 2G spectrum

Bharti Airtel has said that companies holding 2G spectrum should have the first right of refusal on the radio waves they hold, after the expiry of their rights, before it is put up for auction.

"We recommend that the entity holding the spectrum should have the right of first refusal upon expiry of spectrum rights. In case the entity decides not to exercise the option to renew, the spectrum should be auctioned again in a fair and transparent manner," Bharti said in a communication to the Department of Telecom (DoT).

The observations are part of the company's comments on the Draft National Telecom Policy (NTP) 2011 sent to the Telecom Ministry.

On the guidelines for mergers and acquisitions (M&As), the company said that they should be liberalised to facilitate consolidation in the telecom sector.

"... In order to facilitate consolidation we recommend that the M&A guidelines should be liberal, forward looking, equitable and non-discriminatory," Bharti Airtel said.

The company has also suggested that the NTP-2011 should clarify that the Adjusted Gross Revenue (AGR) excludes non-telecom activities.

"To remove regulatory arbitrage, we suggest a uniform licence fee of not more than 6% of AGR for all licencees," the letter added.

Leading telecom firms Bharti, Vodafone and Idea have already written to Telecom Minister Kapil Sibal proposing auction of spectrum to arrive at a fair price.

Bharti has said that telecom regulator Trai's recommendations on one-time spectrum charge is in complete contradiction to the license terms.

Trai had recommended that each MhZ of additional spectrum, after the 6.2 MHz limit held by operators, should cost a one-time Rs 4,571.87 crore (all-India).

However, the one-time fee would vary from circle to circle and the operators would have to pay only for those where they hold extra spectrum, Trai had recommended.

For finalising the one-time charge applicable beyond 6.2 MHz, the firms supported the route of auction instead of Trai recommendations.

According to Trai recommendations, all licencees would have to pay for spectrum at the current price at the time of renewal of licences, or else at price to be discovered through auction or any other market-driven mechanism.

Bharti's comments on NTP 2011 have also been sent to all the members of the Telecom Commission, the decision-making arm of DoT.

This round of comments comes within days of the CEOs meeting Prime Minister Manmohan Singh, Finance Minister Pranab Mukherjee and senior-most officials in various ministries to put forward their views.