October 23, 2009

Revised Framework for MVNO Services in Pakistan

Revised Framework for MVNO Services in Pakistan


Islamabad: Pakistan Telecommunication Authority (PTA), in the fulfillment of obligation under Mobile Cellular Policy 2004, has revised and issued framework for Mobile Virtual Network Operator (MVNO) services to bring it in accordance with the present trend and dynamics of local telecommunication market scenario.

In the revised framework, PTA has made it compulsory for prospective MVNOs to first sign an agreement with at least one Mobile Network Operator (MNO) before applying for the permission from PTA. The MVNO framework restricts the deployment of self-owned network elements i.e. Radio Access, Transmission, Switching and Network equipments etc by MVNOs. Further, MVNOs will be allowed to make commercial arrangements with more than one conventional MNO for provision of mobile communication services to their own customers.


MVNOs shall be allowed to enter into roaming agreements with other operators on mutually agreed terms and conditions and they shall hold their own brand name and customer ownership while marketing their own SIMs. MNOs have also been permitted to enter into commercial agreements with multiple MVNOs. According to the Framework, after the commencement of services by an MVNO, the MNO shall continue to provide its services to that MVNO without any interruption and shall not suspend/terminate its services without prior approval of PTA. The MNO(s) shall be responsible for the national security issues and appropriate clauses will be included in their agreement with MVNO(s) to ensure efficient resolution of such issues.


To provide MVNO services, PTA has set an initial fee of US $ 5 million or equivalent in Pak Rupees. PTA has determined $ 5 million fee keeping in view Pakistan's market and its dynamics. Initially the license shall be issued for period of 10 years which would be extendable for other term/terms of 10 years subject to mutual agreement between the parties and consent of the Authority. However, the license shall be terminated on expiry of agreement between MNO and MVNO or upon expiry of the license of the parent MNO. In case PTA, for any valid reason, terminates the license of a parent MNO, license(s) of attached MVNO(s) shall also stand terminated. It may be noted that like other PTA licensees the MVNOs will also be liable to pay all other regulatory fees and contributions in addition to the initial license fee.


The new MVNO framework says that provision of Quality of Service (QoS) shall be the sole responsibility of licensed MVNO therefore it must ensure that its users receive good QoS as per benchmarks set by PTA. While entering into an agreement with MNO, individual responsibilities of MVNO including provision of QoS should clearly be pronounced in the agreement. The MVNO(s) shall be responsible for making necessary arrangements to facilitate its users and for the purpose it shall establish at least one Customer Care Center and 24/7 helpline in each city of its operation.


The MVNO shall not stop provision of services to its customers without at least a three months notice and prior approval from PTA. MVNO shall also be responsible for resolution of billing or other disputes with its customers. PTA shall approve the contents of Standard Contract of Service and Customer Agreement Form of MVNO(s) prior to the commencement of its services. MVNO(s) shall submit Code of Commercial Practice to PTA and shall follow the same with true letter and spirit.


It is pertinent to mention that this framework may be reviewed by PTA from time to time if PTA deems fit or circumstances require so. It is expected that this new framework will enhance the chances of further growth in the telecom sector of Pakistan by providing opportunities of new investments in the sector and hence making the market friendlier for consumers.


Khurram A.Mehran

Director (PR)