Nigeria’s telecoms regulator, the Nigerian Communications Commission (NCC), is to earn a 60 percent commission on all spectrum swap deals in the country, according to new guidelines on spectrum trading due to be released soon.
The final draft of the Spectrum Trading Guideline 2017 among other things, stipulates that a 60 percent commission accrues to government when frequency spectrums issued under administrative process are sold by licencees.
“For trading of spectrum acquired through administrative process, the seller shall, in addition, pay to the Commission 60% of the net proceeds of the transaction,” the guidelines stipulate.
According to the NCC, the objective of the guidelines is to promote certainty and transparency in the processes of the Commission by outlining the detailed procedure and conditions for spectrum trading in the Nigerian communications sector.
The guidelines are equally expected to enhance the deployment of telecommunications services across the country and to further liberalise the spectrum management policy of the Commission towards efficient and flexible transfer of Spectrum to users who value it most as well as lessening the barriers to market entry by allowing flexible access to spectrum. This is envisaged to deepen competition and promoting innovation by enabling entrepreneurs to acquire spectrum and offer new services.
The guidelines specifically cover various transactions through which spectrum can be traded on the secondary market and listed spectrum transfer, spectrum leasing and spectrum sharing as transactions envisaged under the coverage.
The NCC’s guidelines also cover eligibility criteria for buying and selling of spectrums; requirements and procedures for spectrum trading; fees; renewal of traded spectrums; withdrawal of spectrum trading approvals; as well as the effect of spectrum trading on roll-out obligations.
On eligibility criteria for spectrum trading the guidelines stated that the seller must have held the spectrum for a minimum of 2 (two) years before selling, and where applicable, the seller must have achieved at least 25 percent of the roll-out obligation specified in the spectrum Licence.
“Any Spectrum Licence that is to be traded must still have a validity period of at least one year before the expiration of its tenure. Based on the above, spectrum licences that have a one-year tenure are not eligible for trading. Both the Seller and Buyer must be in good regulatory and financial standing with the Commission.”
According to industry watchers, the new guidelines would address lingering issues relating to spectrum swaps like the Visafone’s CDMA sale to MTN’s and Alheri Engineering sale of 3G licence to Etisalat.