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Pele-Phone cannot return license

August 16, 2003

The Ministries of Communications and Finance are unwilling to allow Pele-Phone to return its 3G UMTS frequencies to the state, or to freeze them, and thereby avoid paying fees for them.

The Ministry of Communications is reportedly preparing regulations requiring the three wireless companies that purchased UMTS frequencies in a tender 18 months ago to pay 25% of frequencies fees this year, and 50% next year.

The wireless companies asked to be exempted from the fees in 2002-2003, since they have no intention of using them during this period. They said the Ministry of Communications had forced them to by the frequencies in early 2002 by combining the tender with the tender for GSM-1800 frequencies, which Cellcom and Partner Communications needed this year. The Ministry of Communications exempted the companies from paying the fees in 2002, but insists on payment this year and next.

The Ministry of Communications is inclined to meet Pele-Phone halfway, but the Ministry of Finance insists on payment. Ministry of Communications Economics and Planning Division head Assaf Cohen told “Globes, “We thought we should find ways to help, but the Ministry of Finance is calling the tune in this matter.”

Partner, which has announced its intention of setting up a UMTS network this year or next, proposed that its payments begin only with the use of the frequencies, when it would pay in full. The Ministry of Communications has not rejected the offer.

Pele-Phone CEO Yacov Gelbard said in response, “The Ministries of Communications and Finance insist that the companies pay the fees for the frequencies, whether or not they’re using them. In Pele- Phone’s case, we’re still trying to return or freeze the purchase process, until the technology becomes relevant. We’re still negotiating with the two ministries.”

 


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