GP�s illegal business

Leasing out of transmission network

Bangladesh’s leading mobile phone operator Grameenphone (GP) is leasing out its transmission network to a number of internet service providers illegally that poses a threat to the growth of nationwide telecommunication transmission network (NTTN) business.
Though GP has denied the allegation, documents obtained by The Independent show that GP is illegally offering transmission network on rental basis to more than 50 companies such as Aamra Com, BDcom, MetroNet, M&H, Getco, TelnetCom, Akij Group, Link3, ADN, Banglalion, Jibondhara and BTS Communication.
According to the obtained billing documents, leasing dates range from August 2013 to December 2014 in Dhaka, Chittagong, Sylhet, Khunla, Barisal, Bogra and other parts of the country.
Although the mobile phone operators were earlier allowed to lease out their transmission networks to other companies, in February 2011 the BTRC issued a guideline scrapping the provision for leasing out transmission network by any mobile phone operator.
Seeking anonymity, an official of Bangladesh Telecommunication Regulatory Commission (BTRC) said GP is making a large sum of money annually through illegal leasing of its transmission network as the biggest telecommunication operator owns nearly 5000km transmission network across the country.
GP transmission network includes optical fibre, E-1, duct, STM (synchronous transport module) and other telecoms installations.
The documents show GP charges monthly Tk 5,000 to Tk 40,000 for leasing out E-1.
In 2009, BTRC issued licences to two NTTN companies, aiming to cut the capital expenditure of telecoms companies, internet service providers, and WiMax operators to ensure affordable service. Later, three state-run NTTN companies got  licences.

“According to the mobile phone licencing guidelines, the telecom operators cannot lease their transmission networks to any telecoms, ISPs (internet service providers) and PSTN (public switched telephone network) operators when the NTTN licensees exist in the country,” A BTRC official said.  
The unauthorised service by GP is severely hampering the business of the NTTN companies, which are solely responsible to lease out fibre optic cable and other network services, said officials of the telecom regulator.
Talking to the Independent, a senior BTRC official said: “Grameenphone is leasing out its transmission network including optical fibre, E-1 and STM. BTRC couldn’t stop the operator from the unauthorised operation despite repeated attempts.”
Grameenphone, a sister concern of Telenor, is offering the lease service in violation of the law in the name of ‘wholesale business’ through its website where price list and product catalogue have been uploaded. But, the price list posted in the website was approved by the BTRC on October 15, 2009, and after that, no further approval was taken.
A notification of the regulator issued on June 7, 2015 by Nafisa Mallick, its senior assistant director (legal and licensing), said “Licences of cellular phone operators have been renewed in 2012, but no permission was given or extended in favour of the operators to lease out their transmission network.”
Replying to a query about the leasing out of its transmission network, Sayed Talat Kamal, head of external communication of Grameenphone, said, “Being respectful of and fully compliant with the relevant laws of Bangladesh, GP is taking and providing lease of applicable transmission capacities in line with the relevant BTRC guideline.”    
Past records of GP
GP was fined on two occasions in 2007 and 2008 for offering illegal VoIP services, compelling the company to pay Tk 418 crore to the telecoms regulator. Following the VoIP scam, GP top management had to go through a major reshuffle to retain its licence to operate in Bangladesh.
Allegations pending against GP
(1)According to a 2010 audit report initiated by the BTRC, GP has also not paid Tk 3,034 crore in taxes, and concealed certain information, including the number of its subscribers, to evade tax. The report was contested by the telecoms operator that led to litigation in the High Court. As per observation of the final verdict of the case, BTRC will now appoint a new audit firm to reassess tax evasion by GP.
(2)According to a report of the Comptroller and Auditor General (CAG) submitted in parliament on September 8 last year, the government has incurred a loss of Tk 19.20 crore over three fiscal years by realising licence fees at a lower rate, instead of the fixed rate, while leasing out Bangladesh Railway (BR) lands to GP.
Under the Land Management Policy 2006, licence fees were fixed at Tk 335 and Tk 223 per sft of land respectively in divisional towns, and in district and other town areas. However, BR realised the licence fee from GP at Tk 16, Tk 8 and Tk 6 per sft of railway land in Pakshi area in the western region in the fiscal years 2007–08, 2008–09 and 2009–10. According to the audit report, this caused huge revenue losses — to the tune of Tk 19,20,46,139. Again the GP authorities have filed a writ petition with the High Court, challenging the new enhanced rates of licence fees. The issue is now pending.
GP ownership structure
GP is a joint venture between Telenor (55.8%), the largest telecommunications service provider in Norway having mobile phone operations in 12 other countries, and Grameen Telecom Corporation (34.2%), a non-profit organisation of Bangladesh. The other 10 per cent shares belong to retail and institutional investors.

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GP�s illegal business

Leasing out of transmission network

Bangladeshs leading mobile phone operator Grameenphone (GP) is leasing out its transmission network to a number of internet service providers illegally that poses a threat to the growth of nationwide telecommunication transmission network (NTTN) business. Though GP has denied the allegation, documents obtained by The Independent show that GP is illegally offering transmission network on rental basis to more than 50 companies such as Aamra Com, BDcom, MetroNet, MH, Getco, TelnetCom, Akij Group, Link3, ADN, Banglalion, Jibondhara and BTS Communication. According to the obtained billing documents, leasing dates range from August 2013 to December 2014 in Dhaka, Chittagong, Sylhet, Khunla, Barisal, Bogra and other parts of the country. Although the mobile phone operators were earlier allowed to lease out their transmission networks to other companies, in February 2011 the BTRC issued a guideline scrapping the provision for leasing out transmission network by any mobile phone operator. Seeking anonymity, an official of Bangladesh Telecommunication Regulatory Commission (BTRC) said GP is making a large sum of money annually through illegal leasing of its transmission network as the biggest telecommunication operator owns nearly 5000km transmission network across the country. GP transmission network includes optical fibre, E-1, duct, STM (synchronous transport module) and other telecoms installations. The documents show GP charges monthly Tk 5,000 to Tk 40,000 for leasing out E-1. In 2009, BTRC issued licences to two NTTN companies, aiming to cut the capital expenditure of telecoms companies, internet service providers, and WiMax operators to ensure affordable service. Later, three state-run NTTN companies got licences. According to the mobile phone licencing guidelines, the telecom operators cannot lease their transmission networks to any telecoms, ISPs (internet service providers) and PSTN (public switched telephone network) operators when the NTTN licensees exist in the country, A BTRC official said. The unauthorised service by GP is severely hampering the business of the NTTN companies, which are solely responsible to lease out fibre optic cable and other network services, said officials of the telecom regulator. Talking to the Independent, a senior BTRC official said: Grameenphone is leasing out its transmission network including optical fibre, E-1 and STM. BTRC couldnt stop the operator from the unauthorised operation despite repeated attempts. Grameenphone, a sister concern of Telenor, is offering the lease service in violation of the law in the name of wholesale business through its website where price list and product catalogue have been uploaded. But, the price list posted in the website was approved by the BTRC on October 15, 2009, and after that, no further approval was taken. A notification of the regulator issued on June 7, 2015 by Nafisa Mallick, its senior assistant director (legal and licensing), said Licences of cellular phone operators have been renewed in 2012, but no permission was given or extended in favour of the operators to lease out their transmission network. Replying to a query about the leasing out of its transmission network, Sayed Talat Kamal, head of external communication of Grameenphone, said, Being respectful of and fully compliant with the relevant laws of Bangladesh, GP is taking and providing lease of applicable transmission capacities in line with the relevant BTRC guideline. Past records of GP GP was fined on two occasions in 2007 and 2008 for offering illegal VoIP services, compelling the company to pay Tk 418 crore to the telecoms regulator. Following the VoIP scam, GP top management had to go through a major reshuffle to retain its licence to operate in Bangladesh. Allegations pending against GP (1)According to a 2010 audit report initiated by the BTRC, GP has also not paid Tk 3,034 crore in taxes, and concealed certain information, including the number of its subscribers, to evade tax. The report was contested by the telecoms operator that led to litigation in the High Court. As per observation of the final verdict of the case, BTRC will now appoint a new audit firm to reassess tax evasion by GP. (2)According to a report of the Comptroller and Auditor General (CAG) submitted in parliament on September 8 last year, the government has incurred a loss of Tk 19.20 crore over three fiscal years by realising licence fees at a lower rate, instead of the fixed rate, while leasing out Bangladesh Railway (BR) lands to GP. Under the Land Management Policy 2006, licence fees were fixed at Tk 335 and Tk 223 per sft of land respectively in divisional towns, and in district and other town areas. However, BR realised the licence fee from GP at Tk 16, Tk 8 and Tk 6 per sft of railway land in Pakshi area in the western region in the fiscal years 200708, 200809 and 200910. According to the audit report, this caused huge revenue losses to the tune of Tk 19,20,46,139. Again the GP authorities have filed a writ petition with the High Court, challenging the new enhanced rates of licence fees. The issue is now pending. GP ownership structure GP is a joint venture between Telenor (55.8%), the largest telecommunications service provider in Norway having mobile phone operations in 12 other countries, and Grameen Telecom Corporation (34.2%), a non-profit organisation of Bangladesh. The other 10 per cent shares belong to retail and institutional investors. Related News: The biggest offers the worst (17-03-2014) Grameenphone rejoinder and our reply (20-03-2014) Judge sues Grameenphone, BTRC (04-09-2014) Leasing out rly land to GP: Govt loses Tk 20cr (16-09-2014) Evasion of Tk 3,034cr tax: GP faces fresh audit (02-10-2014) GP evades Tk 400cr tax: NBR (03-10-2014) Call drops belie GP quality claims (15-10-2014) GP says sorry to client for changing package (15-10-2014) The largest offers the slowest GP 2G, 3G internet speed poorest among leading mobile operators Report (20-10-2014) US labour body lodges complaint against GP (21-11-2014) GP employees stage demo across country Services disrupted (22-12-2014) GP workers unrest continues (23-12-2014) GP agrees to pay employees (25-12-2014) GP, Banglalink, Airtel flout guidelines (12-01-2015) GP hits Tk 100b revenue landmark (10-02-2015) Displeasure at GP over job cut (21-05-2015) GP associate firm defaults Tk 33cr VAT payment (26-05-2015) Grameenphone reluctant to provide MNP services to subscribers (12-06-2015)