Trai Advances Mtnl Hearing On Cellular Cos Petition

The Telecom Regulatory Authority of India yesterday advanced the hearing of cellular operators petition challenging the entry of state-owned MTNL into cellular telephony from February 11 to February 4.

This was decided after MTNL filed a petition for early hearing of the case, citing the adverse effects of the authoritys status quo order on the cellular plans of the company in Delhi and Mumbai.

The status quo order was causing grave prejudice to MTNL....The order has (adversely) affected the share price, MTNL said in its petition.

MTNL shares were ruling at Rs 260 per share on January 6 when the order was issued. The last reported share price was Rs 222 per share.

Legal counsel for the cellular operators Manjul Bajpai said the operators had no objection to an early hearing of the case.

While the preliminary issue, which will be discussed on February 4, is whether the government can grant a licence to a new service provider without a recommendation from TRAI, the authority will also allow discussion on whether MTNL is a new service provider or not.

The TRAI Act, 1997, expressly vests the authority with the power to recommend the need and timing of a new service provider which is MTNL in this case.

Reiterating that MTNL is not a new service provider, the petition said the company has been providing radio mobile service since 1985.

The clarification to the licence was only to confirm the existing facts (and not the grant of a new licence), MTNL said.

Based on the amendment/clarification to the licence, MTNL had represented to the international investor community/institutions that it is actively seeking to enter into the cellular mobile services by modernising and expanding the same into Delhi and Mumbai, the company said.

It added that the stay order of the authority was therefore adversely affecting the image of MTNL and the image of India before the international investor community.

Explaining the Catch-22 situation MTNL finds itself in, company said that valuable time would be lost if the company does not proceed with the necessary preparations for modernisation and expansion of the existing cellular service.