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Citycell's demise a formality away

by July 22, 2017 General

Prime Minister Sheikh Hasina, who also heads the posts, telecommunications and information technology ministry, has given the green light to cancellation of Citycell’s licence over non-payment of fees and charges.

All that needs doing now for the curtains to come down on the country’s oldest operator once and for all is a public notification from the telecom regulator.

The issue of public notification will be placed in the next meeting of the Bangladesh Telecommunication Regulatory Commission, which recommended the cancellation last month.

“The decision was taken to ensure regulation in this field,” said a top official of the BTRC’s legal and licensing wing.

Citycell’s spectrum will now be put up in the upcoming auction for 4G licence.

“This will be a first for the country,” he added. Citycell management remained unavailable for comment yesterday.

In October last year, the BTRC shutdown Citycell’s networking switch over dues of Tk 377 crore pertaining to spectrum and licence fees, revenue sharing and late penalty.

The operator then paid Tk 230.19 crore to the BTRC along with Tk 14 crore as tax to the National Board of Revenue, according to documents.

It, however, went on to dispute the amount claimed by the BTRC, prompting the court to form a three-member committee to work out the exact sum outstanding.

In the meantime, the court asked the down-and-out operator to continue to clear its remaining dues to the BTRC. But Citycell did not make any payments between October last year and March this year, meaning it violated the court’s order as well, according to BTRC officials.

The Section 46 of the Telecommunication Act allows the BTRC to cancel the licence of any entity for non-payment of dues. In June, the BTRC made its recommendation to cancel Citycell’s licence. Meanwhile, Citycell is of the belief it has made Tk 129.27 crore of overpayment to the BTRC.

The operator has paid Tk 476.27 crore as spectrum charge, licence fee, revenue sharing and social obligation fund to the telecom regulator, said Pacific Bangladesh Telecom Ltd, Citycell’s parent company.

Its dues until October last year was Tk 346.99 crore, meaning that an additional Tk 129.27 crore has already been furnished to the telecom regulator, PBTL said. So the dues incurred since October 2016 should be adjusted against the additional Tk 129.27 crore paid by PBTL, it added.

Besides its dues to the BTRC, Citycell is Tk 3,000-4,000 crore in the red to different banks and financial institutions, vendors, tax authorities and other operators, according to insiders.

Of the banks, National Bank had put Citycell’s head office up for sale in May after the operator failed to pay back its loan of Tk 454.45 crore. The bank, however, found no interested party. China Development Bank also filed a petition last year to realise its dues of $36.63 million from Citycell. Singapore’s SingTel owns 44.54 percent shares in Citycell, Pacific Motors 37.95 percent and Far East Telecom 17.51 percent, according to their annual report.

Shareholders had been trying to sell the operator’s licence for the last few years but in vain. 

Citycell began its journey in 1993, with its subscription hitting a peak of 19 lakh in 2011.

But at the time of network shutdown by the BTRC in October last year its customer base stood at 1.25 lakh only.

In fiscal 2014-15, Citycell’s total revenue was Tk 139.77 crore, while its investment was zero, according to the BTRC.