Union Cabinet finalises spectrum usage charges in 1800 MHz and 900 MHz bands

The Union Cabinet has approved the following rates of Spectrum Usage Charges (SUC) for spectrum in 1800 MHz and 900 MHz bands

1. The spectrum acquired in the current auction will be charged at 5% of the AGR. In cases of combination of existing spectrum in this band and spectrum acquired through the auction, the weighted average will apply to all the spectrum held by the operator in 900 MHz and 1800 MHz band.

2. The licensees who do not acquire spectrum in this auction shall continue to pay SUC according to the existing slab rate.

3. As 800 MHz spectrum is not being auctioned in the forthcoming auction and the recommendation of the Telecom Regulatory Authority of India (TRAI) has been sought for the reserve price, the decision in respect of Code Division Multiple Access (CDMA) spectrum will be taken at an appropriate time.

4. In respect of Broadband Wireless Access (BWA) spectrum acquired through auction in 2010, SUC will continue to be charged, as per present practice, and the operator would be required to report the revenue earned from BWA spectrum separately.

5. Cabinet noted that as a matter of policy, it is desirable to move to a flat rate SUC and adoption of a weighted average would provide a path for such transition.

6. The above decisions are expected to improve the bidding sentiment in the forthcoming auction.