TRAI recommendations on License Fee and Policy Matters of DTH Services

TRAI has released the following recommendations on “License Fee and Policy Matters of DTH Services” on 21st August 2023:

1. MIB should develop a robust mechanism for deduction verification process through single window portal. The Licensee is required to produce to the Licensor, all such books of accounts and documents required for reconciliation which have a bearing on the verification of revenue for the purpose of calculating License Fee.
2. DTH Licensee should pay an annual license fee equivalent to 3% of AGR License Fee for DTH Licensees should be brought down to zero in next three years. DTH Licensees should not be charged any License Fee after the end of the financial year 2026-2027. The Licensee should submit an Initial Bank Guarantee from any Scheduled Bank to the MIB for an amount of Rs. 5 crore for the first two quarters. Thereafter, the Licensee should submit a Bank Guarantee (covering Financial and Performance Bank Guarantee) from any Scheduled Bank to the MIB for an amount equivalent to the Initial Bank Guarantee (i.e., Rs. 5 crore) or 20% of the estimated sum payable, equivalent to License
3. Fee for two quarters and other dues not otherwise securitized, whichever is higher.
4. Once the license fee becomes zero, the Licensee should submit a Bank Guarantee (Performance Bank Guarantee) for a fixed amount equivalent to the initial Bank Guarantee (i.e., Rs. 5 crore) from any Scheduled Bank to the MIB, which should be valid for a minimum of one year and renewed every year to ensure it remains valid for the entire currency of the license Agreement.
5. The Licensor should be at the liberty to encash the Bank Guarantee in full or part in the event of violation of any of the license condition.
6. Electronic Bank Guarantee should be encouraged and permitted for ease of doing business.