PTA drafts comprehensive licensing framework for MVNOs

ISLAMABAD: The Pakistan Telecommunication Authority (PTA) has drafted a comprehensive licencing framework for Mobile Virtual Network Operators (MVNOs), introducing a structured regulatory regime along with an initial licence fee of USD 140,000, envisaging to expand competition and innovation in the telecom sector.

According to the draft licence, MVNOs will be authorized to provide mobile communication services across Pakistan, excluding Azad Jammu & Kashmir (AJ&K) and Gilgit-Baltistan (GB). The framework sets out detailed conditions governing service scope, commercial arrangements with Mobile Network Operators (MNOs), regulatory compliance, and financial obligations.

Under the proposed regime, MVNOs will operate by entering into commercial agreements with one or multiple MNOs, subject to PTA approval. These agreements will enable MVNOs to offer mobile communication and next-generation services without owning core telecom infrastructure or spectrum. Instead, they will rely on the network resources of their parent MNOs.

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The draft outlines a set of mandatory services that MVNOs must provide nationwide. These include access to emergency services, operator assistance, and national and international long-distance services through agreements between MNOs and Long Distance & International (LDI) operators. Additionally, the PTA reserves the authority to require MVNOs to offer other telecom services as needed.

While the licence allows flexibility in branding and service customization, MVNOs will be permitted to operate under their own brand names and develop tailored service offerings. They may also install customer care, billing, and related systems to support their operations. However, the license strictly prohibits MVNOs from deploying their own radio access or core network infrastructure, assigning spectrum, or establishing independent roaming and interconnection agreements.

The license will be valid for a period of 15 years from the effective date, with provisions for renewal. MVNOs must apply for renewal at least 30 months before the license expires. The PTA will then assess compliance history and regulatory adherence before granting or denying renewal, with an opportunity for the licensee to present its case in case of adverse findings.

A key feature of the draft is its emphasis on maintaining competitive balance in the telecom market. If an MVNO is determined to have Significant Market Power (SMP), it will be required to comply with PTA directives aimed at preventing anti-competitive practices and ensuring fair market conditions.

The framework also mandates the implementation of Mobile Number Portability (MNP), allowing consumers to switch operators without changing their numbers. MVNOs and their parent MNOs will share responsibility for technical and operational arrangements to support MNP, in line with PTA regulations.

On the financial side, in addition to the upfront USD 140,000 license fee, MVNOs will be subject to a range of annual regulatory fees and contributions. These include an Annual License Fee (ALF) of 0.5 percent of gross revenue (after deductions), a Universal Service Fund (USF) contribution of 1.5 percent, and a Research and Development (R&D) contribution of 0.5 percent. MVNOs will also be required to pay annual numbering charges through their parent MNOs.

All payments must be made within 120 days of the end of the financial year, failing which a late payment surcharge of 2 percent per month will be imposed. Persistent non-compliance may result in penalties, including suspension or termination of the license.

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The draft also includes provisions for encouraging local manufacturing, technology transfer, and research and innovation within Pakistan’s telecom ecosystem. MVNOs are expected to support these national objectives in line with government policies and PTA directives.

In terms of operational limitations, MVNOs will not be allowed to provide services in AJ&K and GB, nor can they interconnect with telecom systems outside Pakistan independently. All international and national connectivity must be routed through licensed operators and existing MNO arrangements.

The license further imposes strict data retention requirements. MVNOs must maintain detailed call records, including caller and receiver information, date, time, duration, IMEI, and location data, for at least one year. Internet session logs and IP address records must also be stored for the same duration and made available to the PTA upon request.