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Major Findings/Recommendations

November 2013

Presentation by Mr. Davender Jain World Bank Consultant

The Presentation is based on major findings and recommendation as a result of Consultation carried out between 1st October and 31st October 2013 with:

Vodafone Ltd;

Telecom Fiji Ltd;

Digicell;

Fintel

Consumer Council of Fiji; and

Fiji Commerce Commission

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It is considered important to mention here that it doesn’t contain any personal views of the Consultant and is purely based on written and verbal feedback from the respondents.

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Since its inception TAF has helped in bringing some order into the ICT sector e.g. a little more transparency than before.

At least some semblance of regulatory order in a dynamic sector where technological innovations are often way ahead of legislative and regulatory regimes.

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Business Benefit: Certainty that providers had to be licensed and this would be non-discriminatory.

Community Benefit: Certainty that operators had to be able to provide certain coverage requirements and other specifics.

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Some of the other benefits that accrued by the formation of TAF and making of Promulgation and Regulations in the ICT Sector are reported to be:

Stimulation of innovation;

Enable diversification;

Increase in efficiency

liberalization of the market;

Favorable provisions in relation to the non-discriminatory treatment of operators; and

Ensuring Operators issues are dealt with.

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Overall, the Operators should be licensed to reduce substandard services and interference.

The application process within the Licencing Regulations has not been overly onerous as again, the Open Licenses are available under those Regulations.

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License duration—Section 35 caps the maximum duration of an operating license at 15 years. This is unduly low and does not reflect either the nature of major licensee’s investments or commitments. It would be worthwhile reviewing the appropriateness of this cap and removing it entirely to enable TAF to adopt more appropriate license durations.

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Whilst an open license is acceptable, there should be certain controls and/or guidelines in alignment with regulatory requirements in what an entity is permitted to provide. TAF’s processes should appropriately address any matter necessary for the issuance of any license, and should include and not limited to proper due diligence & evaluation of applicants, etc.

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Some licenses have been issued to parties that had not set up facilities for providing services in the country. There could be a risk to the community due to fraudulent operators. Therefore due diligence needs to be done, together with penalties for non-compliance.

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TAF is now playing a very important role in the ICT sector.

TAF and the Ministry of Communications have moved quite quickly in recent months with an Acting Chair of TAF being appointed.

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Continuity of Leadership is important to bring about stability.

This is also important for realisation of initiatives on their way, as well as new ones.

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Structure of the Authority—Division 2 of Part 2 of the Promulgation establishes a board to exercise the powers of the TAF. Given the scale of the Fijian telecommunications sector, there may be value in considering replacing the board at the apex of the TAF with an individual, such as exists in other Pacific Islands such as Vanuatu and Samoa. This would increase the responsiveness of TAF while also reducing the costs.

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Regulations and regulatory systems need to be established with appropriate resourcing. Regulations must match resources to monitor the market, ensure compliance and apply appropriate penalties where so required.

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Fees are now collected as below:

ICT levy – Commerce Commission

Voice levy – FRCA

Spectrum fees - MoC

US - TAF

Licensing - TAF

Any other fees????

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Industry would like to see more transparency in terms of reasons for collection of the above fees and their application for the promotion of the ICT sector in Fiji. This also needs to be coordinated at a higher level in Government to harmonise the fee structure and preferably reduction.

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The effect of new fees, charges and levies has been significantly higher cost of doing business in the Telecommunications sector. Given that all regulatory fees and charges ultimately get passed onto consumers in the form of higher prices, it would be worthwhile considering re-establishing the cost-recovery principle in order to minimise the regulatory costs that are imposed on industry and the consumers.

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Perhaps other alternatives could be found to USS as it exists now, such as each operator opting to put a site in one of these areas every year or the Operator using the USO levy for expansion of its own network into some USO areas, rather than this going into a “pool” as a “levy” which could be used by a competitor or any third party winning a Tender

Consideration should be given to the Operators who are currently providing services in non-economical areas that are not part of the US scheme.

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To date there are a number of areas that are still to be developed e.g. numbering scheme.

Hijacking of numbering is an important issue that should be addressed by TAF.

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Importation of equipment – no list of allowed/not allowed items and so when items arrive at port of entry, then they realize that the items are not allowed into Fiji.

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TAF should get involved in as early as possible in the setting up of standards e.g. performance standards for ISP providers as far as broadband is concerned e.g. 128k dial up was marketed as broadband by an operator. This is important from consumer protection point of view.

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FCC’s view is that TAF could do better in the following areas:

Monitoring the conduct of the operators;

Illegal bypass e.g. grey routing (illegal operations); and

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Providing technical assistance to FCC on technicalities of pricing.

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This summarises feedback from respondent in the Regulatory Impact Assessment Exercise

Based on the above and knowledge and experience of TAF staff it is considered important to prepare an “Action Plan” to remove the road blocks being faced now and move TAF forward.

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