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NCC gives fresh conditions for trading in spectrum

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Executive Vice Chairman/CEO, Nigerian Communications Commission, Prof. Umar Garba Danbatta.

Telecommunications operators and players, including sellers and buyers interested in spectrum trading, must have sound regulatory and financial standing with the Nigerian Communications Commission (NCC) for a minimum of three straight years prior to their engagement.

Stating that it would ensure fairness in pricing, the regulator noted that it might depart slightly from age-long procedures without compromising justice and observance of extant laws for the betterment of the industry.

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In the new eligibility criteria released at the weekend, the commission clarified that a licensee would not be allowed to trade in the spectrum for which a notice of forfeiture had been issued by it (regulator) and would not get approval if it is established that the licensee had breached terms and conditions of the licence.

Spectrum trading is a broad concept encompassing various means of introducing a “secondary market” where licensed operators are allowed to trade their exclusively assigned spectrum usage rights to unlicensed parties with the objective of enhancing efficient use of the product.

In the 15-page document sighted by The Guardian, the NCC said the guidelines were made pursuant to Sections 4 (j) and 121 (1) of the Nigerian Communications Act 2003, which empowered it to manage, administer and regulate the use of spectrum in the communications sector.

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In the new rules, the commission said to trade, seller must have held spectrum for a minimum of one year, as against the previous requirement of two years.

The regulator, in May 2020 via a statement issued by its former Director of Public Affairs, Dr. Henry Nkemadu, suspended the Spectrum Trading Guidelines (STG) 2018 for review to meet prevailing realities.

But by October 2020, another release by his successor, Dr. Ikechukwu Adinde, disclosed that the embargo had been lifted subject to conclusion of the evaluation. In the adjusted copy titled “Nigerian Communications Commission Spectrum Trading Guidelines 2021, August 2021,” the commission said where applicable, the seller must have achieved at least 25 per cent of the rollout obligation specified in the licence at the time of trading.

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The procedures warned that licensees must not trade in areas where there is a Mobile Virtual Network Operator (MVNO) to check conflict of interest, adding that a buyer would not be permitted to provide access to an MVNO on a spectrum being traded.

The NCC explained that commercial spectrum would not be traded to companies providing war robotics/drones for security purposes except with the express permission from the Office of the National Security Adviser (NSA).

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While the administrative fee of one per cent of gross proceeds remains, the commission disclosed that for the trading of spectrum acquired through administrative process, the seller would pay to the organisation 70 per cent as (against 60 per cent mentioned in the previous guidelines) of the net proceeds.

According to the NCC, in the case of spectrum sharing and leasing for a period of not more than three months, including trials, management approval would apply, with only the administrative required if need be.

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