Private FM players get payments breather: Trai issues interim recommendations

MUMBAI: After a long while, some cheer for private FM radio broadcasters.

The Telecom Regulatory Authority of India (Trai) today issued its interim recommendations on private FM broadcast. According to the recommendations, FM licensees may be given the option of deferring payments, which may fall due till a final decision is taken.

The dues as finally decided by the government, after taking into account the recommendation of Trai, would be collected from the licensees with interest from the due date, on the quantum of license fees found to be payable.

The final recommendations of Trai would address the issue of license fee payable as well as the relevant interest rate, says a Trai statement.

Following Trai's latest directive on the matter, all licensees could be given the option of deferring their next instalment of dues subject to the condition that they would pay this amount, after the issue is decided by the government, with interest as may be decided finally.

Previously, the government constituted a committee on 24 July '03 to make recommendations for radio broadcasting for phase - II. Chaired by FICCI's secretary general Amit Mitra, the committee's terms of reference, inter alia, included the following:

"Study the desirability and legal implications of making modifications in licensing regime of phase-I licensees should a different licensing regime be proposed for phase-II."

Subsequently the ministry of information and broadcasting, had, on 12 February '04, sent the report of the committee headed by Mitra to Trai for making appropriate recommendations.

On 11February '04, five private FM broadcasters had met the deputy prime minister and submitted a representation requesting for deferment of the annual FM license fee, till the government takes a decision on implementation of the FM radio task force's recommendation. This representation had been referred to Trai, for its recommendations, by the government on 24 February '04.

The government had in its letter pointed out that in respect to Mumbai, the next license fee for the third year is due in April 2004. Delhi, Kolkata and Chennai, licensees have not paid the license fee for the second year due in August 2003, requesting the government to charge the license fee from the date of actual operation. While the government is still considering the matter, if approved, these license fees will also become due in April '04. It has been pointed out that the request of private broadcasters involves the relaxation of terms and condition of the license.

For making appropriate recommendations on the radio broadcast policy committee report, Trai has been in the process of preparing a consultation paper on which it would seek the comments of all the stakeholders. In this connection Dr Mitra gave a presentation on his report to the authority and will be submitting additional information to the Authority.

Trai has called for the accounts of the phase I licensee and these are being scrutinised. It is also in the process of holding meetings with various stakeholders in this regard. This process is likely to take time and in the meanwhile the license fees of some of the operators is likely to fall due. As such, an interim recommendation has been given to the government on its second request dated 24 February '04 since this issue overlaps with and is linked to the first request for recommendations.

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