Telecommunication Authority’s Inaction Allows Internet Services To Operate Illegally Without Licenses

Kathmandu: Due to inaction by the Nepal Telecommunication Authority (NTA), several internet service providers have been found operating illegally without valid licenses. The authority has neither renewed the licenses of providers with outstanding dues nor revoked their expired licenses.

Since Bhupendra Bhandari assumed office as chair of the NTA on February 18, 2024, the regulator has kept internet service providers in limbo. Even after providers applied for license renewal, the authority delayed decisions, creating prolonged uncertainty.

As a result, service providers have continued operating internet services even after their license periods expired. Under the Telecommunications Act, providing services without a valid license is illegal.

Officials familiar with the licensing process say previous NTA leaderships routinely provided license renewals. Providers with unpaid dues were restricted from participating in Rural Telecommunication Development Fund (RTDF) projects and other facilitation measures. However, licenses were still renewed procedurally once renewal fees were paid.

“Until two years ago, licenses were not withheld like this,” a source close to the NTA told TechPana. “Pressure was applied to collect dues, but licenses were not left unrenewed. Not renewing a license is effectively the same as not having one. If the intention is to collect dues, the license should be renewed. If not, it should be revoked. Both cannot happen at the same time.”

The Telecommunications Act requires license holders to apply for renewal within a specified period before expiry. The Telecommunications Regulations further clarify that applications must be submitted three months before the license expires, along with the renewal fee.

If an application is submitted within the license validity period with a reasonable explanation for missing the deadline, the authority may renew the license by charging an additional 15 percent fee. The regulations clearly state that if a license is not renewed within the validity period even after this provision, it must not be renewed.

Despite these clear legal provisions, the current authority leadership has failed to act accordingly.

Classic Tech provides a clear example. The company’s license expired on August 28, 2025. Since then, it has continued operating without a valid license. Classic Tech originally received its license on August 29, 2010. It renewed the license for the first time in 2020 after the initial 10-year period. Subsequent renewals are valid for five years. Accordingly, the license expired in August 2023.

Although Classic Tech applied for renewal, the authority has refused to renew it, citing more than Rs 500 million in outstanding dues. However, the license has also not been revoked.

A former director of the authority said the regulator has no legal option other than revocation if renewal cannot proceed due to unpaid dues. “The authority should formally notify the service provider well in advance. Three months before expiry, it should clearly state the amount due and set a deadline. If the dues are not cleared, it should clearly inform that the license will be revoked,” he said.

He added that once the license expires without renewal, the authority should formally revoke it. “Did the authority issue a revocation notice on the expiry date? The law is clear. Indecision is not an option.”

According to the authority, licenses of Mercantile Communication and Himalayan Online Services have also not been re-issued even after their 25-year license periods expired. Both companies continue to provide services without valid licenses. Mercantile received its license on March 22, 1999, while Himalayan Online received its license on May 23, 1999.

NTA Director and spokesperson Min Prasad Aryal said service providers failed to renew licenses because they did not clear dues despite repeated notices. “The concerned branch has sent multiple letters and notices requesting payment. Licenses cannot be issued until dues are paid,” he said.

When asked whether services would be allowed to continue indefinitely without licenses, and how long the authority would wait before revoking them, Aryal said the authority would make decisions as necessary while correspondence continues.

However, a notice issued by the authority on December 7 warned only small and mofussil ISPs of license revocation. The notice stated that if unpaid royalty and RTDF dues were not cleared within 35 days, licenses would be revoked. Notably, the notice did not include large ISPs such as Classic Tech and Mercantile.

The absence of these companies from the notice has raised questions. Officials say the reason large ISPs with political reach were excluded remains unclear.

A former chair of the authority described the situation as policy corruption. “Failing to revoke licenses after renewal deadlines have passed is corruption by indecision,” he said. “If dues are unpaid and conditions are violated, the regulator must act. Waiting indefinitely violates the law. Licenses should be revoked and dues recovered as government claims. Confusion is not neutrality. It is wrongdoing.”

 

पछिल्लो अध्यावधिक: मंसिर २९, २०८२ १४:१

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