Back to the complete issue
Wednesday, 13 July 2016

NTRA to charge telecoms 6% of their annual revenues in fees under 4G framework, Orange Egypt objects to NTRA negotiating on Telecom Egypt’s behalf

The three existing mobile network operators will pay a consistent royalty to the state of 6% of their annual revenues within two-to-three years of obtaining their 4G licenses, according to a CIT Ministry source. By Al Mal’s count, the NTRA will generate c. EGP 1.8 bn for the state’s coffers based on combined annual revenues Vodafone Egypt, Orange Egypt and Etisalat Misr of c. EGP 30 bn. The three operators currently pay a royalty ranging from 5-6% annually. There is still no confirmation on the royalty Telecom Egypt would pay as the fourth player to arrive at the party. Orange, Vodafone, Etisalat and Telecom Egypt will also have to pay EGP 360 mn annually to offer fixed-line services under the 4G framework agreement, which will allow the regulator to net EGP 2 bn per year from the framework. The source added that the NTRA has no intention of extending the deadline to bid for 4G licenses after the first week of August.

Meanwhile, Orange Egypt is appealing a ruling by the Administrative Court that allows the NTRA to negotiate on behalf of Telecom Egypt with mobile operators to use its infrastructure. The ruling, which was apparently issued by the court on 21 June but is only now making the rounds in the media, affirms the NTRA’s role in approving pricing in contracts between companies operating in the telecommunications sphere as well as oversight of independent negotiations between telecom players, Al Masry Al Youm reports. Orange says NTRA is intervening in a commercial matter and should not be party to negotiations between companies, according to Al Borsa. We noted yesterday that the fixed-line monopoly had asked the regulator to negotiate on its behalf with the three current mobile network operators on both what TE charges the operators to use its infrastructure as well as the fees Telecom Egypt will pay to piggyback on mobile operators’ towers when TE obtains a 4G license.

Enterprise is a daily publication of Enterprise Ventures LLC, an Egyptian limited liability company (commercial register 83594), and a subsidiary of Inktank Communications. Summaries are intended for guidance only and are provided on an as-is basis; kindly refer to the source article in its original language prior to undertaking any action. Neither Enterprise Ventures nor its staff assume any responsibility or liability for the accuracy of the information contained in this publication, whether in the form of summaries or analysis. © 2022 Enterprise Ventures LLC.

Enterprise is available without charge thanks to the generous support of HSBC Egypt (tax ID: 204-901-715), the leading corporate and retail lender in Egypt; EFG Hermes (tax ID: 200-178-385), the leading financial services corporation in frontier emerging markets; SODIC (tax ID: 212-168-002), a leading Egyptian real estate developer; SomaBay (tax ID: 204-903-300), our Red Sea holiday partner; Infinity (tax ID: 474-939-359), the ultimate way to power cities, industries, and homes directly from nature right here in Egypt; CIRA (tax ID: 200-069-608), the leading providers of K-12 and higher level education in Egypt; Orascom Construction (tax ID: 229-988-806), the leading construction and engineering company building infrastructure in Egypt and abroad; Moharram & Partners (tax ID: 616-112-459), the leading public policy and government affairs partner; Palm Hills Developments (tax ID: 432-737-014), a leading developer of commercial and residential properties; Mashreq (tax ID: 204-898-862), the MENA region’s leading homegrown personal and digital bank; Industrial Development Group (IDG) (tax ID:266-965-253), the leading builder of industrial parks in Egypt; Hassan Allam Properties (tax ID:  553-096-567), one of Egypt’s most prominent and leading builders; and Saleh, Barsoum & Abdel Aziz (tax ID: 220-002-827), the leading audit, tax and accounting firm in Egypt.