NATIONAL COMMUNICATIONS AUTHORITY

PUBLIC CONSULTATION

ON THE

INTRODUCTION OF UNIFIED SERVICE LICENCE

NOVEMBER 2014

Contents

SUMMARY OF CONSULTATIONS 3

CHAPTER 1 5

1.1 GENERAL INFORMATION 5

1.2 INTRODUCTION OF UNIFIED ACCESS SERVICE LICENCE IN GHANA 6

1.3 MARKET OVERVIEW 7

CHAPTER 2 9

THE RATIONALE AND OBJECTIVES FOR UNIFIED ACCESS SERVICE LICENCE 9

CHAPTER 3 11

3.1 ELIBILITY 11

3.2 THE SCOPE AND CONDITIONS OF THE LICENCE 11

3.3 PROCEDURE FOR THE GRANT OF FIXED ACCESS SERVICE LICENCE 11

3.4 DURATION OF LICENCE 12

3.5 LICENSING FEES 12

CHAPTER 4 13

4.1 CONTENT OF THE PROPOSAL 13

4.2 UPDATING 14

4.3 MODIFICATION 14

4.4 DISCLAIMER 14

4.5 ADDITIONAL INFORMATION 14

ANNEX A- RESPONSE FORMAT 15

ANNEX B- STANDARDIZED APPLICATION GUIDELINES 17

ANNEX C- GUIDELINES FOR SUBMISSION OF FEASIBILITY REPORT FOR FIXED ACCESS

SERVICE IN GHANA 19

ANNEX D -IMPLEMENTATION TIMETABLE 21

ANNEX E –REQUEST FOR APPLICATIONS 22

Page 2 of 22

SUMMARY OF CONSULTATIONS

1. The NATIONAL COMMUNICATIONS AUTHORITY (NCA) intends to invite Applications from

existing mobile network operators registered under the Ghana Companies Act, 1963, Act 179 for the

grant of a Fixed Access Service Licence to provide services including fixed telephony, broadband and

other value added services.

2. Accordingly, in pursuance of its mandate under Section 27 of the Electronic Communications Act,

2008, Act 775 and Section 4.1 of the National Telecommunications Policy 2005 (NTP‟05), the

Authority hereby invites views and comments from Licensed Communication Service Providers,

Consumers of communication services and the General Public on the appropriateness and award

process which can be accessed on the Authority’s website, www.nca.org.gh.

3. The public consultation begins with immediate effect and shall expire on 3rd December, 2014.

4. All responses/comments should be electronically sent as e-mail attachments, in Microsoft Word format

to uaslconsultation@nca.org . gh

5. All respondents are requested to complete a response cover sheet (annexed A). The cover sheet can be

also downloaded on the Authority’s website, www.nca.org.gh.

6. In furtherance of transparency and openness, the Authority shall consider all responses as non-

confidential; accordingly all submissions shall be published on our website on receipt.

7. The Authority hereby invites comments and views on the Eligibility Criteria, Scope and

Conditions of the Licence, and Award Process outlined in this document. Highlights of the

modalities are presented below.

Eligibility

This Licence is targeted at the existing mobile network operators who shall express interest for the

grant of Fixed Access Service Licence for the remainder of the duration of their existing Cellular

Mobile Licence to deploy Fixed Service and other value added services to customers.

Broadband Wireless Access (BWA) licence holders may also be eligible and can apply for the licence

upon meeting the roll-out conditions contained in their licences.

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Scope and Conditions of the Licence

The Licensee shall be authorized to establish and operate a Fixed Access Network to provide fixed access services.

The Licensee shall have the right to provide fixed services with any technology

The Subscriber numbers for Fixed services shall be allocated as per the National Numbering Plan upon request and at a fee.

The Licensee shall be authorized to operate only for the unexpired term of the duration of the existing Cellular Mobile License

Award Procedure

The Applicant shall satisfy all the conditions in Chapter 4.

Duration

The duration of the licence shall be for the unexpired term of the existing Cellular Mobile Licence.

Fees

1. There shall be a non-refundable application fee of One Hundred and Fifty Thousand

Ghana cedis.

2. A Licence fee of Six Hundred Thousand Ghana cedis for each year of operation.

Next Steps

Subsequent to the completion of the Public Consultation and taking into account comments received from

Stakeholders, the Authority shall publish the final modalities and Fixed Access Service Licence documents,

invite applications and review the applications submitted by the prospective applicants.

Page 4 of 22

CHAPTER 1

1.1 GENERAL INFORMATION

The NATIONAL COMMUNICATIONS AUTHORITY (NCA) is mandated under Section 3(c) of the NCA

Act, Act 769 of 2008 (''The Act") to issue Licences for the operation and provision of communication services,

and to determine the criteria for the award of licences.

In furtherance of the National Telecommunications Policy 2005 (NTP’05), the Electronic

Communications Act, 2008, Act 775, and the National Electronic Communications Regulations,2011,

L.I.1991, the National Communications Authority (NCA) intends to restructure its licences by

introducing Unified Access Service Licence, in phases and in line with technological and market

demands as well as current best practices. The said Unified Licence is targeted at the existing network

operators and Broadband Wireless Access (BWA) licence holders who shall be considered upon

meeting the roll-out conditions contained in their respective licences

This Licence, in accordance with the NTP’05, shall provide for such related obligations such as

competitive neutrality, non-discrimination and transparency. Presently, the principal enactments and

the policy documents governing the communications industry in Ghana are the following:

The National Telecommunications Policy (NTP), 2005

The National Communications Authority Act, 2008, Act 769

The Electronic Communications Act, 2008, Act 775

The Electronic Communications (Amendment) Act 2009, Act 786

National Electronic Communications Regulations, L.I.1991, 2011

The Ghana ICT for Accelerated Development (ICT4AD) Policy, 2003

This document should be read in conjunction with the above mentioned legal statutes and other

applicable statutory laws including rules, regulations, decrees, orders, decisions, guidelines, directives

and documents of general application issued by the Government of Ghana or the Authority.

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1.2 INTRODUCTION OF UNIFIED ACCESS SERVICE LICENCE IN GHANA

The NCA intends to adopt the principle of technology neutrality in the licensing framework and to allow any

form of access communications system and infrastructure to be used to provide any type of communications

service that is technically feasible. It is also to provide for such obligations as competitive neutrality, non-

discrimination and transparency.

The introduction of a Unified Access Service Licence has become necessary due to competition, market

demands, and objectives of the National Telecom Policy, convergence advantages and international best

practices.

The intended objectives of a unified access service licence regime are;

• to enable flexibility and neutrality in the use of access technologies

• to enable fair and increased competition

• new market opportunity with new source of revenue

• to enable innovation in services and value to consumers

• to improve licensing process of carriers

• to ensure flexibility and efficient utilisation of resources

The Unified Access Service licensing process shall be implemented in two phases.

Phase 1 (2015)

Grant of Fixed Service Authorisation for the unexpired term of the duration of the existing Cellular Mobile

Licence

Phase 2 (2019)

Mandatory substitution of expired Cellular Mobile Licences with a Unified Access Service Licence

It is worth noting that in recent times, the voice telephony service globally has been observed to be stable and

telecoms experts have predicted a downward trend in the coming years, thus giving way to high speed data

services. The Authority shall be proactive by introducing additional Licences that would support high speed

data services and also promote innovation in the industry. The Authority believes the introduction of Unified

Access Service Licence regime is the way forward.

The Authority envisages that the implementation of this framework shall have a positive impact and benefit the

existing operators, consumers as well as the economy at large.

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1.3 MARKET OVERVIEW

The provision of fixed telephony services has been restricted to only two out of the six

network operators in the country.However, the two Fixed Service licensed operators with the

mandate to provide and increase the fixed and broadband penetration has a combined

penetration of 1.02% with one of them having a market share of about 97% thus making it a

virtual monopoly. This figure continues to decrease each year. This duopoly or quasi-

monopoly has failed to sustain the adoption of fixed telephony with the highest subscription in

Ghana at 383,184 in 2007 declining by 42% to 270,422 in 2013. This could be described as

unhealthy competition and has resulted in less consumer choice of network and service

subscription, in an era where technological development has blurred the distinction between

fixed and mobile services.

This is a threat to the proposed National Broadband Policy Targets of minimum 1Mbps for

domestic users now and minimum 2Mbps for universal access by 2020. The fixed networks

have seen lots of innovations in developed economies. For example, apart from telephony

service, Fixed Service networks are used to provide high speed data and video services and

applications such as telemedicine, and remote diagnostics, video conferencing, tele-command

among others. Regrettably, this is not the case in Ghana. The low level penetration of fixed

telephony and broadband deployment has made it mandatory for the Authority to authorize the

other network operators to provide other services traditionally not defined in the scope of their

licences. This will further improve universal access and telecom services in Ghana.

The mobile telephony market has seen explosive growth with access penetration of 108.99%

as at March, 2014. This is mainly driven by multiple SIM ownership and extension of network

coverage to underserved areas. To stimulate the market further, there should be new market

opportunities that would bring further innovations and value added services. For the same

period fixed voice and broadband markets have penetration rates of 1.02% and 49.39%

(mainly due to mobile data) respectively which is inadequate. For international connectivity,

MainOne, Glo-1, WACS, ACE and SAT-3 combine to provide an excess of 13Tbps of

bandwidth capacitywhich is currentlyunder-utilized.

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Wireless has been considered as an alternative access especially for developing countries but

wireless networks come with spectrum scarcity, sharing mechanisms and interference issues.

In Ghana the mobile network operators are facing challenges with the deployment of wireless

access for high speed broadband data in some areas. These challenges do not make wireless

networks the optimum option for especially Enterprise broadband services and therefore the

need to encourage the deployment of fixed access technologies as the alternative.

The NCA has the obligation to ensure competitive neutrality, non-discrimination and

transparency. The Authority therefore wishes to implement the Unified Access Service

Licence regime by 2019 to allow for the use of any access technology of choice for voice

telephony and non-voice data services. Before 2019, the Authority wishes to grant Fixed

Service Access licence of five years to existing Cellular Mobile Operators.

In this consultative document, the Authority has discussed the need to grant the additional

Fixed Service Access Licences as it moves to the Unified Access Service regime, the

advantages it would bring to stakeholders and the benefits to customers and Government.

Page 8 of 22

CHAPTER 2

THE RATIONALE AND OBJECTIVES FOR UNIFIED ACCESS SERVICELICENCE

Fair and Increased Competition

The introduction of the Unified Licence will enable increased competition among Service Providers to

provide converged or bundled services to enhance consumer choice. This is expected to translate into

improved customer experience as service quality by the Service Providers becomes competitive. This

is also expected to lead to relatively more affordable services for subscribers due to the competition

and increased subscription. The Regulator would have ensured a level playing field by the issuance of

Unified Access Service Licences.

In addition, technological developments have blurred the means of accessing communication services.

Services covered under one license can also be provided under another license. Therefore licence

development should be harmonized to ensure fair, equitable and competitive delivery of

communication services by the operators.

To Promote Innovation

The introduction of the Unified License is expected to lead to an increase in innovation. With Unified

Service Licence, Service Providers will be able to offer bundled services and will also be able to offer

tailor-made solutions for its subscribers. It will also offer flexibility to the Service Providers in terms

of packaging products and services. This will give visibility to local application and content service

providers and ensure value proposition.

New Source of Revenue/ Market Opportunity

Unified licence will provide the opportunity for Service Providers to have new sources of revenue as a

result of participation in the fixed telephony and broadband services market. These new revenue

sources will be from the new services as well as network services. This will also translate into more

revenue for the Government as well as more employment opportunities for Ghanaians.

Tariff Convergence

Tariff convergence of fixed and cellular services has made it impossible to provide price distinction.

For example in recent times the network operators have implemented same interconnect charging

Page 9 of 22

regimes for both fixed and cellular services, almost same retail pricing for all services thus

necessitating the need to review into the current licensing structure.

NTP Objectives

The decision to authorize the network operators to provide fixed telephony services in addition to

mobile telephony will achieve a number of the objectives outlined in the National Telecom Policy. An

objective of the policy is to fully open competitive markets for all telecommunications services, to

ensure Universal Access Service and to promote efficient and effective regulation of the

telecommunications industry on a transparent, technology neutral and non-discriminatory basis.

Government proposed Broadband Policy Targets of Minimum 1Mbps for domestic users and

Minimum 2Mbps for universal access by 2020 could be achieved.

International Best Practice

A number of countries have migrated to the concept of converged licensing. This has been encouraged

as a result of technological developments, consumer demand, long-term sustainability of telecom

service providers and optimum utilization of resources. From the international perspective, it has been

observed that a Unified Licensing regime enhances the scope of applications/ services that can be

provided under a given single license. Unified Access Service Licence regime removes policy

imposed artificial barriers on application of technology. Unified Access Service Licences have been

issued in Kenya, Nigeria, Uganda, Asia (Malaysia, Singapore, and India) Europe (UK, Germany,

Finland) and Australia and these have enabled high mobile and fixed penetration rates with very high

competition.

Page 10 of 22

CHAPTER 3

3.1 ELIGIBILITY

This Licence is targeted at the existing mobile network operators who shall express interest for the

grant of the Fixed Access Service Licence for the unexpired term of the duration of their existing

Cellular Mobile Licence to deploy Fixed Service and other value added services to customers. Phase

Two is where the Authority shall renew by way of substituting the existing Cellular Mobile Licences

with a Unified Access Service Licence.

Broadband Wireless Access (BWA) licence holders may also be eligible and can only apply for the

licence upon meeting the roll-out conditions contained in their licences.

3.2 THE SCOPE AND CONDITIONS OF THE LICENCE

The scope and conditions of the Fixed Access Service Licence under Phase 1is as follows:

Licensee shall be authorized to establish and operate a Fixed Access Networks to provide fixed access services.

Licensee shall have the right to provide fixed services with cable access technology

Subscriber numbers for Fixed services shall be allocated as per the National Numbering Plan upon request and at a fee.

Licensee shall be authorized only for the unexpired term of the duration of existing Cellular Mobile Licence

3.3 PROCEDURE FOR THE GRANT OF FIXED ACCESS SERVICE LICENCE

3.3.1 The Applicant shall apply for the Fixed Access Service Licence for only the unexpired term of

the duration of its Cellular Mobile Licence.

3.3.2 All applicants must be fully compliant with the requirements stated in Standardized

Application Guidelines [See ANNEX B] and the Guidelines for submission of Feasibility

Report for Fixed Access Service in Ghana (See ANNEX C). There shall absolutely be no

consideration for failing to satisfy these requirements.

3.3.3 Proof of Payment of Application Fee.

3.3.4 Compliance with requirements and criteria set forth in Chapter 4.

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3.4 DURATION OF LICENCE

The Licence shall have the same duration as the remaining duration of the existing Cellular Mobile

licence and shall expire at same date.

3.5 LICENSING FEES

3.5.1. There shall be a non-refundable application fee of One Hundred and Fifty Thousand Ghana

cedis.

3.5.2. A Licence fee of Six Hundred Thousand Ghana cedis for each year of the remaining term of

the Cellular Mobile Licence term.

3.5.3 An Annual Regulatory fee of One percent (1%).

3.5.4. Other fees such as for GIFEC, and taxes such as Communications Service Tax (CST) and Value

Added Service Tax (VAT) such be applicable to this licence.

Page 12 of 22

CHAPTER 4

4.1 CONTENT OF THE PROPOSAL

The proposal for a Unified Service License shall contain the following:

4.1.1 Receipt: Evidence of payment of the application fee of One Hundred and Fifty

Thousand Cedis;

4.1.2 Application Letter: An application letter which sets forth the applicant’s intention to

apply for this Authorization;

4.1.3 Certificates: Certificates issued by the relevant governmental authorities in Ghana. The

above notwithstanding, all applicants shall submit certified true copies of their Certificate of

Incorporation, Certificate to Commence Business and Company Regulations obtained from

the Registrar General of the Republic of Ghana;

4.1.4 Power of Attorney: Each Applicant shall designate a representative for purposes of

Sections 4.1.2 and 4.1.6 pursuant to a Power of Attorney issued in accordance with the laws

of its jurisdiction of incorporation;

4.1.5 Sworn Declaration: A Sworn Declaration of the Applicant signed by its duly authorized

representative, with the following information:

i. Identification of all the shareholders of the Applicants that control more than 5% of its

capital and of the entities that directly or indirectly are the beneficial shareholders

thereof. The beneficial shareholders of the Applicant shall mean those who directly or

indirectly own the majority of the shares or the voting rights or who otherwise control

such Applicant;

ii. Statement that all the information and documentation submitted in connection with the

application is true, accurate and complete;

iii. Statement that the Applicant has not been the subject of any bankruptcy

proceedings, reorganizations, or similar proceedings in the last 5 years;

iv. Statement that, since the date of the Applicant’s last audited reports and financial

statements submitted pursuant to Section 4.1.6, there has not been any material adverse

changes thereto.

4.1.6 Audited Reports and Financial Statements

The audited reports and financial statements corresponding to the last three fiscal years of the

Applicant and (if applicable) the consolidated group to which the Applicant belongs.

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4.2 UPDATING

Each Applicant shall maintain current, the facts and information supplied in the Proposal, and

shall communicate to the NCA all material changes that arise with regards thereto.

4.3 MODIFICATION

This Selection Procedure does not constitute an offer to contract on the part of the NCA and

NCA has the right to modify or amend any provision or condition hereof; provided however, that

any such modification or amendment shall be valid only if it is in writing.

4.4 DISCLAIMER

The NCA shall not incur any liability whatsoever in exercising its rights in 4.3 above or any

other rights granted in this Process.

4.5 ADDITIONAL INFORMATION

The NCA reserves the right to request, at any time, additional information or documentation

from Applicants.

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ANNEX A- RESPONSE FORMAT

COVER SHEET FOR RESPONSE TO NCA PUBLIC CONSULTATION ON THE

INTRODUCTION OF UNIFIED ACCESS SERVICE LICENCE

BASIC DETAILS

Name of Respondent:

Representing (self or organisation/s):

Address:

DECLARATION

I confirm that the correspondence supplied with this coversheet is a formal consultation response.

It can be published in full on NCA’s website, and I authorize NCA to make use of the information in

this response to meet its legal requirements. If I have sent my response by email, NCA may

disregard any standard e-mail text about not disclosing email contents and attachments.

Name: Signed (if hardcopy)

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Format for Commenting on Document

Chapter Number Section Number Heading Comment Suggestion/ Proposed

Amendments

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ANNEX B- STANDARDIZED APPLICATION GUIDELINES

General Information

1. Applicant

a. Name

b. Title

c. Citizenship

d. Address

e. Contact numbers

2. Management

a. Name

b. Title

c. Citizenship

d. Address

e. Contact numbers

3. Directors

a. Name

b. Address

c. Contact numbers

d. Citizenship

e. Shareholding %

f. Other Telecommunication Interests

i. Name of Company

ii. Address

iii. Contact Numbers

iv. Shareholding %

v. Authorization/Authorization Status

vi. Credit/Default Status

4. Shareholders (with at least 5% holding)

a. Name 17

b. Address

c. Contact numbers

d. Shareholding %

e. Other Telecommunication Interests

i. Name of Company

ii. Address

iii. Contact Numbers

iv. Shareholding %

v. Authorization/Authorization Status

vi. Credit/Default Status

a. Name of Entity/ Company/Partnership/Trust/Consortium etc., please define

b. Certificate of Incorporation in Ghana (Company Registration Number & Date of

Registration)

c. Certificate to Commence Business in Ghana; Number & Date

5. Applicants must exhibit evidence of parties with which they have entered into any

agreements, arrangements or understandings which relate in any way to the Authorization

being allocated.

6. Defaults & Delinquencies

Information required of all applicants regarding defaults and delinquencies. Each applicant

must submit information on whether the applicant, its affiliates, its controlling interests, and

the affiliates of its controlling interests are in default of any NCA licenses and/or are

delinquent on any non-tax debt owed to any National agency.

7. Miscellaneous Information

Applicants wishing to submit a statement of verifiable reasons sufficient to justify, and or

enhance their chances may do so if they so wish.

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ANNEX C- GUIDELINES FOR SUBMISSION OF FEASIBILITY REPORT FOR FIXED

ACCESS SERVICE IN GHANA

1. COMPANY PROFILE

a) Evidence of Incorporation (in Ghana)

b) Certificate to Commence Business (in Ghana)

c) Shareholders/Company Regulations

d) Relevant Experience/Evidence of Ability to perform including agreements drawn up with any

principals.

e) Evidence of Tax payment/Tax Clearance Certificate

f) SSNIT Contribution of Workers

g) List of Affiliate Companies

2. PROJECT STUDY

a) Engineering design system

b) Technical Implementation Plan

3. MARKET PLAN

a) Business Idea and Choice of Technology

b) Market Analysis

c) Network Deployment and Services to be offered

d) Roll-out Plan and Coverage Area

e) Market: This is to include Market Goals, Target Groups etc.

4. BUSINESS PLAN

a) Organisational Structure (including educational and technical background as well as

experience of key personnel)

b) Mission Statement

c) Capital Investment:

This should include –

i. Equipment Categories

ii. Equipment Prices

iii. Equipment Suppliers and

iv. Capital Investment Summary

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5. FINANCIAL REPORTS

a) Audited Financial Reports for the past five years

This should include:

i. Income Statement

ii. Balance Sheet

iii. Cash Flow Statement

iv. Evidence of sustained funding

b) Financial Plan including:

i. Equity

ii. Suppliers Credit (if any)

iii. Bank Loan (if any)

6. Any other information that is relevant to demonstrate the viability of the project.

7. LETTER OF COMMITMENT

All applicants are also to submit a signed letter of commitment stipulating that they shall abide

by all existing ITU Regulations and Communications laws of the country as well as other rules

and regulations that may be issued.

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ANNEX D -IMPLEMENTATION TIMETABLE

S/N ACTIVITY DURATION START DATES

1. Publication of Licence conditions and

process Document for comments

10 Business

Days

24th November,

2014

2. Review of comments 5 Business

Days

9th December, 2014

3. Press Release to Invite Applications 1 Business Day 16th December,

2014

4. Submission of Application and Proposals to

NCA

As and when

Application

Form is

completed

5. Evaluation of Submitted Proposals by NCA 40 Business

Days

6. Award and announcement of Winner 1 Business Day

7. Payment of Licence Fees Up to 60 Days

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ANNEX E –REQUEST FOR APPLICATIONS

The NATIONAL COMMUNICATIONS AUTHORITY (“NCA’) invites applications from the existing

network operators for the grant of a Licence to establish, maintain and operate fixed services in the

country.

The Applicant(s) for the fixed Licence should be in good standing with the Authority

The Award Procedure Document can be accessed on the Authority’s website: www.nca.org.gh.

All applications duly sealed are to be submitted to the Director General’s Secretariat on or before 1700

hrs on 28th November 2014 and addressed to:

The Director General

National Communications Authority

1st Rangoon Close

Cantonments, Accra

The Authority intends to issue a total of up to four (4) Fixed Access Service Licence to the existing

Cellular Mobile licensees

Any Applicant may communicate for clarification on the subject in writing to the DIRECTOR

GENERAL, NATIONAL COMMUNICATIONS AUTHORITY, on or before 1700 hrs on 7th

November,2014.

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