Creating a Conducive Environment for Investment and Trade

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Creating a Conducive Environment for Investment
and Trade
Asia Pacific Forum on Telecommunications Policy
And Regulation 2006
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1 /
Singapores Experience
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SINGAPORES EXPERIENCE

• Singapore recognises the importance of creating a
  conducive and competitive infocomm landscape.
• Competition and regulatory frameworks
• Telecommunications Competition Code
• reliance on market forces to the extent possible
• promotion of facilities-based competition
• technology neutrality
• more stringent regulatory requirements on
  dominant operators
• The Code was reviewed and revised in February
  2005 to ensure its continued relevance to the
  industry.

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• Interconnection and access framework
• ensure seamless, any-to-any communications
  throughout Singapore
• consists of only a minimal set of interconnection
  and access obligations applicable to all
  operators
• IDA encourages operators to commercially
  negotiate their interconnection arrangements.
• stricter rules were put in place to govern the
  interconnection arrangements with dominant
  operators

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Changing Role of the Regulators

• Evolving beyond the traditional regulatory
  functions of ensuring effective competition and
  seamless interconnection.
• REGUTLATORY ? COMPETITION MANAGEMENT

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2 /
REGULATORY DISCIPLINES
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WTO TELECOMMUNICATIONS ANNEX REFERENCE PAPER

• Telecommunications Annex
• Transparency
• Access to and use of PTTNS
• Reference Paper
• Competitive Safeguards
• Interconnection
• Universal Service
• Licensing
• Independent Regulator
• Allocation of Scarce Resources

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2a /

• Licensing

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Why have Trade Disciplines on Licensing ?

• The key reason is to increase investor confidence
• Lack of transparency, objectivity and
  impartiality reduces investor confidence in the
  fairness of the regulatory regime
• The licensing process, if badly implemented, can
  easily nullify or impair trade commitments
• Unreasonable or burdensome requirements increase
  the cost and delays of supplying services

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Key Disciplines on Licensing

• Regulators shall ensure their licensing process
  does constitute unnecessary barriers to trade
• This means that regulators shall ensure their
  licensing process is
• Reasonable
• Impartial
• Objective
• Transparent

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Reasonable, Objective

• Regulators shall ensure the licensing process is
  not more burdensome than necessary to ensure the
  quality of the telecom service
• based on logical reasoning and facts
• Regulators shall ensure the licensing process is
  not in itself a restriction in the supply of the
  telecom service
• Regulators should take into account international
  standards of relevant international organizations
  like the ITU
• Regulators shall ensure the licensing process is
  based on pre-established objective criteria
• For example, technical and financial ability to
  provide the telecom service

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Impartial

• Regulators shall ensure the same licensing
  process applies to domestic and foreign operators
• This complements the MFN obligation which means
  that WTO Members must give the same regulatory
  treatment to the services and operators of all
  other WTO Members equally and without
  discrimination

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Implementation - Reasonable, Impartial, Objective

• Try to reduce the number of individual licences
  required
• Generally individual licences are required if
  there is a need to manage scarce resources and
  when the operator has significant market power.
  Otherwise class licences are adequate.
• Consult widely when reviewing or designing the
  licensing process
• Publish any proposed changes on your website and
  invite comments
• In particular, consult the industry (domestic,
  foreign, SMEs and MNCs)
• Consult the experts
• Study and build upon the practices of a wide
  range of regulators

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Transparent

• Regulators shall have Transparent
• Notification, registration and licensing
  requirements
• Licensing criteria and procedures
• Decision making period for assessing licences
• Terms and Conditions of all licences issued
• Reasons for denial of a licence
• The key transparency disciplines are found in
  the WTO Telecommunications Reference Paper

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Implementation - Transparent

• Use website extensively
• It works 24/7, its interactive and good for
  gathering feedback, cost effective
• Publish licences issued by the Regulator
• Publish licence conditions

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Licence Conditions

• (1) Qualification Criteria
• Technical competence and ability to provide the
  telecom service
• Financial strength and capability to provide the
  telecom service
• Applicant should not be associated with incumbent
  operator
• (2) Selection Criteria where number of licences
  is limited
• In the case of an auction
• Highest bid price
• Highest score based on quantitative criteria
• Eg fastest time required to meet rollout target
• Eg lowest maximum retail price of service

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Licence Conditions

• (3) Licensing Procedures
• Provide the forms electronically
• Ask only for the necessary documents, forms,
  diskettes.
• Charge a reasonable and impartial administrative
  fee to applicants eg less than US500
• Complete the entire evaluation process and award
  the licence within a reasonable period eg 2 to 4
  weeks, with a maximum of 8 weeks for complex
  applications
• (4) Licence Fees
• Charge reasonable and impartial licence fees
• Eg for value-added services
• US35 a year (class licence)
• US3000 a year (individual licence)

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Licence Conditions

• (5) Licence Duration
• Should not be unreasonably short
• Eg for Facilities-based operators 10 to 15
  years duration
• Eg for value added services 3 years
• Should have reasonable renewal terms
• (6) Quality of Service (QOS) standards
• Should not be more burdensome than necessary
• Should follow international practice

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Licence Conditions

• (7) Universal Service Obligations
• Should be narrowly and clearly defined eg limited
  to POTS (Plain Old Telephone Service)
• should be competitively neutral does not favour
  incumbent or new operators
• (8) Interconnection and Access Obligations
• Should not be applied on non-facilities based
  operators
• Should be applied on incumbents and operators
  with significant market power, in a proportionate
  manner

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Licence Conditions

• (9) Pro-competitive obligations such as number
  portability, accounting separation, preventing
  anti-competitive arrangements
• Should be applied on incumbents and operators
  with significant market power, in a proportionate
  manner

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CONCLUSION

• The licensing process can easily become a barrier
  to trade
• will become more salient as countries liberalise
  and increase market access to their
  telecommuications markets
• A shift in the mental models may be helpful
• A Regulator could also see itself as an
  Investment Attractor and therefore streamline
  and market its regulations and processes
  accordingly

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2b /

• Management of Scarce Resources

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Why have Trade Disciplines on Management of
Scarce Resources ?

• Markets are limited by availability of scarce
  resources.
• Potential to attract investments
• The expanding role of markets in telecom is made
  possible by a substantial commitment of public
  resources
• Governments are changing the way they manage
  these public resources
• Apart from the efficiency of the allocation of
  the public resources, the structure of the
  competition in telecom markets will be greatly
  affected

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What are Scarce Resources

• Rights of Way
• Numbering
• Frequency Allocation

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WTO REFERENCE PAPER
6. Allocation and use of scarce resources Any
procedures for the allocation and use of scarce
resources, including frequencies, numbers and
rights of way, will be carried out in an
objective, timely, transparent and
non-discriminatory manner. The current state of
allocated frequency bands will be made publicly
available, but detailed identification of
frequencies allocated for specific government
uses is not required."
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RIGHTS OF WAY

• Ensure ability to access the rights of way
  required to place facilities in conduits, poles,
  and transmission towers on public or private
  lands
• Address issue of limited capacity for underground
  conduits and above-ground pole lines
• Fair charges for existing rights of way
• Equitable access to public property
• Access to private property through private
  negotiations

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NUMBERING

• Administrating of numbering resources should be
  done in a objective and non-discriminatory manner
• Dispute resolution mechanism should be in place
• Number portability must be encouraged/enforced

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FREQUENCY

• Rights to use spectrum must be fair and
  transparent
• Conflicting applications for the same spectrum
  should be resolved by a competitive process
• License terms for extended periods and accorded
  reasonable flexibility
• Spectrum channelization should be flexible
• Comparable charges ensured
• Allow freedom on use of spectrum and allowing
  resale

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CONCLUSION

• A robust and sound policy and regulatory
  framework is fundamental to create a conducive
  environment for investment and trade.
• The following principles must be adhered to
• Reasonable
• Impartial
• Objective
• Transparent
• Timeliness
• Non-discriminatory

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Thank you www.ida.gov.sg