LDI Companies Ask Parliamentary Aid in Rs.78 Billion Dispute with PTA

As nine firms collectively addressed Aminul Haque, the chairman of the National Assembly Standing Committee on Information Technology, the long-running conflict between the Pakistan Telecommunication Authority (PTA) and Long Distance and International (LDI) telecom companies has intensified.

The Rs. 78 billion disputes, which the LDI companies claim is endangering billions of dollars in both domestic and foreign investment in the sector, has prompted them to request parliamentary action in a formal letter.

LDI companies are retaliating in response to the unwillingness of PTA to renew their licenses unless all outstanding debts have been paid in full. According to the PTA, a total of Rs. 78 billion is owed by the enterprises, of which Rs. 24 billion is the principal amount and Rs. 54 billion is the amount of late payment penalties.

A controversial dispute over Access Promotion Contribution (APC) payments from 2008 to 2011 is the reason for the dues.

The corporations contend that PTA’s APC notifications were illegal and against the law; the Auditor General of Pakistan’s 2011 special audit report echoed this position, finding PTA’s activities to be irregular.

The LDI enterprises insist on their right to continue operating while the matter is under judicial review, even though their licenses have expired. To show their good faith, several businesses have even placed more than Rs. 5 billion into escrow accounts.

Although five of the nine businesses have indicated that they would be ready to pay the principal amount in installments, they have objected to the terms that PTA has put in place for its suggested installment plan. The concept of installments under the existing terms has been flatly rejected by the other four businesses.

The operators of LDI wrote a letter to the parliamentary committee in which they criticized PTA and said that the PTA’s standing is not only illegal but also undermines investor trust in Pakistan’s telecom industry.

They demanded that their licenses be renewed immediately and that the dues be recalculated at a set amount of $0.02 per minute, which some operators are willing to accept.

The letter stressed that it is unreasonable and ineffective for the PTA to insist on fines even while the money is being held in escrow.

The corporations have been reassured by Chairman Aminul Haque that their opinions will be taken into consideration. He affirmed that representatives of LDI will have the chance to address the Standing Committee directly to make their case.