Indian operators will not be able to lease spectrum as part of proposals by the country’s telecoms regulator for spectrum trading.
The Telecom Regulatory Authority of India (TRAI) said operators will only be able to transfer spectrum ownership, with leasing barred for the time being.
In its recommendations for spectrum trading, TRAI said “only outright transfer of spectrum is permitted i.e. the ownership of the usage right is transferred to the buyer”.
Until now, the government has allocated spectrum to operators via auctions. Trading of spectrum is expected to lead to more efficient use of airwaves as it will allow smaller operators with unutilised spectrum to trade it.
A statement from TRAI confirmed that mobile operators will not be required to obtain permission from the country’s government to trade spectrum under the proposals.
Companies will instead only need to inform the authorities of any deals to transfer spectrum six weeks ahead of the trade.
The new rules will apply to spectrum awarded on or after 2010, or if the seller paid the market price for the spectrum to the government.
Trading spectrum will not change the length of the original licences. Once traded, spectrum will not be eligible to be sold again for two years.
According to an earlier Economic Times report, operators acquiring spectrum will need to pay a 1 per cent transfer fee based on the market price or the price for which the spectrum is sold.
The report added that buyers of spectrum must not acquire the equivalent of more than 25 per cent of its total spectrum holding or 50 per cent within a given band in a particular service area.