Spectrum auction to begin on March 1; DoT invites applications

Department of Telecommunications (DoT) have invited applications from interested for the upcoming spectrum auction. In the notice inviting applications, the department under Ministry of Communication informed that the auction for 2,251.25 MHz of spectrum will begin on March 1, 2021.

"A single auction process will be carried out for assigning spectrum blocks in various bands, viz. 700 MHz, 800 MHz, 900 MHz, 1800 MHz, 2100 MHz, 2300 MHz and 2500 MHz bands... On behalf of the President of India, applications are invited from prospective bidders who meet the eligibility criteria for participating in the auction. Based on the applications, the government shall prequalify applicants who meet the eligibility criteria for participation in the auction," the DoT notice said.

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The telecom department informed that the pre-bid conference will be held on January 12, the venue and time for which will be declared later. Interest bidders can seek clarifications on the notice inviting applications till January 15, which will be offered to them on January 28. Applicants have been asked to submit their applications by February 5 and they can withdraw their applications by February 22.

Ownership details of the bidders will be published on February 12 and bidder ownership compliance certificates will be issued on February 15. DoT will prequalify bidders on February 19. The final list of bidders will be published on Februrary 24.

Following a mock auction on February 26, the telecom department will start the auction from March 1, 2021. Successful bidders will have to pay the bid amount within 10 days of the issue of demand note. MSTC Ltd has been appointed as the advisor to the government in this spectrum auction and will act as the auctioneer for the e-auction. The validity of spectrum won in this auction will be 20 years from the effective date.

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On December 16, the Cabinet had approved the next round of spectrum auction to help telecom operators boost their network capacities. A total of 2,251.25 MHz is being offered with a total valuation of Rs 3,92,332.70 crore (at reserve price). The successful winners will be able to augment their network capacity after having the rights to use the spectrum. The new players will also be able to start their telecom services.

As part of payment conditions, the successful bidders may pay entire bid amount upfront or exercise an option to pay 25 per cent for spectrum won in 700 MHz, 800 MHz, 900 MHz bands or 50 per cent for spectrum won in 1800 MHz, 2100 MHz, 2300 MHz, 2500 MHz bands upfront. The remaining amount can be paid in up to a maximum of 16 equated annual instalments after a moratorium of two years.

The successful bidders will also have to pay 3 per cent adjusted gross revenue (AGR), excluding wireline services as spectrum usage charges.

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