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HK regulator postpones performance bond
October 15, 2002
The Telecommunications Authority (TA) said it would postpone the
performance bonds due in October 2002 from the four licensees for
3G mobile services. The bonds are in respect of the sixth licence
year.
"We have decided to give the 3G licensees a one-year waiver on
the submission of performance bonds to assist the industry in response
to changing market conditions. Our decision is taken after careful
consideration of needs of the industry and the steps other Governments
have taken to help their 3G licensees," said a spokesperson of the
Office of the Telecommunications Authority (OFTA).
The 3G licensees have, on the grant of the licences in October
2001, either submitted performance bonds to guarantee the payment
of the spectrum utilization fee (SUF) for the first five years,
or paid upfront the SUF for the first five years. Therefore, the
waiver of the performance bonds due this year means that the Government
has in hand guarantee for the payment of the SUF or payment thereof
for the next four years, rather than for the next five years.
"The waiver does not affect Government revenue as the licensees
are still required to pay the SUF for all years within the 15-year
licence period," continued the OFTA spokesperson.
By accepting the waiver, the four licensees would not be required
to submit on 22 October 2002 a performance bond to guarantee payment
of the SUF of $60.124 million for the sixth licence year to be called
in the event of serious default. However, those who have not done
so already would still be required to pay HK$50 million for the
SUF of the first licence year by 22 October 2002.
On 22 October 2001, the TA awarded four 3G licences to Hong Kong
CSL, Hutchison 3G HK, SmarTone 3G and SUNDAY 3G.
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3G Motorola A920
