The note, which is available to The Financial Express, says that existing licencees will have to switch over to a multipoly arrangement from the duopoly system on acceptance of the revenue-sharing package. The DoT has taken the stand that a multipoly regime will be generate more revenue for the Government.

The note further says that, "it should be ensured that the defaulting licensees are not totally absolved of the contractual obligations voluntarily undertaken by them under the licence agreements and migration from the 1994 policy to the 1999 policy should be subject to a number of conditions."

The conditions include payment of licence-fee arrears, includinginterest as provided in the licence agreements up to the prospective date to be determined by the Government. However, the calculation of arrears will be subject to adjustments consequent to extension of effective date of licences.

The DoT has also said that companies should securitise the arrears by furnishing requisite bank guarantees (BG) for the total amount of arrears, including interest, coupled with an undertaking to keep the BG alive till the arrears are cleared and also enhance the same to cover further sums that may be due.

DoT has also said that time for clearance of dues may be extended until December 31, 1999 or any other date as the Government may deem fit in order to provide some relief to the operators.

The department has said that consequent upon the integration of the existing licenses into the new telecom policy (NTP) 1999, the period of licence needs to extended by 10 years taking it to 20 years. This is being done in order to enable them to effectively compete with the new licenseesand maintain parity. The period of 20 years will be calculated from the date of the existing licence agreement.

While stating that the effective date of the licences may be extended across the board in all cases, the DoT has said that the period of the extension may range from six months to maximum of nine months, as the Government may decide.

In addition, for those service providers whose effective dates of licence have already been extended for less than six months, the DoT has said that such companies could be granted a further extension.

On the lock-in period, the note says that it should be expressly provided that no transfer of shareholding directly or indirectly through subsidiary or holding companies will be permitted. This condition will not apply in cases of service providers who have been permitted change in the share holding structure by the competent authority.

The question of percentage of revenue share under NTP 99 will be finalised by the Government based on the recommendations of theTRAI.