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ASR Rate Was Hiked Without Authority's Approval, Alleges Member Finance

By  | 25, May 2011 | 3 Comments

Before we go to the real story, a little back ground first; I am sure that by now most of our readers are familiar with the ongoing clash between Chairman PTA and suspended Member Finance of PTA.

Just in case if you don’t know – here’s is how this all started and ended with the suspension of PTA’s Member Finance against an inquiry for the accusations made by his own chairman.

In a recent most development, during the inquiry, Member Finance has reportedly submitted his response – along with counter allegations against Chairman PTA, and accused that many decisions of crucial nature were carried out without the approval of the authority.

According to “The News” one of such decisions that were approved by Chairman PTA were issuance of Approved Settlement Rates (ASR) Access Promotion Contribution (APC), which Member Finance claims were not approved by authority.

Just in case if you don’t know – any regulation, or decision made by PTA is held approved only when majority of three top heads of authority agree with it.

Three heads include:

  • chairman PTA,
  • member finance
  • and member technical.

Here’s what Pakistan Telecommunication Act 1996 (with 2006 amendments) says:

The powers of the Authority in the matters relating to its administration and the staff of the Authority shall be exercised by the Chairman.

The decision of the Authority shall be taken with the concurrence of the majority of its members.

Now according to suspended member finance, APC rates were hiked without following the proper procedures, as authority’s approval wasn’t there.

Following is the excerpt from “The News”

Before issuing revised rates usually on six monthly bases, detailed in-house analysis is carried out and then findings of this analysis are shared with all Long Distance International (LDI) operators and their views and comments are invited.

Based on the feedback of the LDI operators and analysis carried out by PTA, the ASR/APC rates are determined with the written approval of the authority.

In total disregard of this standard practice Chairman PTA Dr. Mohammad Yasin increased the rates in connivance with the DG (Commercial Affairs) without the written approval of the authority.

In this regard the report says that without issuing meeting minutes, the ASR/APC was revised upward from US$0.10 per minute to US$ 0.125 per minute against the wishes of the majority of stakeholders who wanted lowering of the rates to US$0.75.

No approval was taken though in the letter it is misstated that it was approved by the authority.

This increase in ASR/APC rates from US$ 0.10 per minute to US$ 0.125 per minute without approval of the authority unleashed floodgates of grey traffic, which is now hard to control, the report says.

It is contended that if ASR/APC were reduced to US$ 0.75 the grey trafficking would have decreased significantly.

Chairman PTA’s single-handed action of increasing it is now causing loss of billions to national kitty and the International Telephony is now touching around 500 million minutes per month and as per some estimates around 30-40% minutes per month are engulfed by grey traffic which means around US$15 to $20 million are lost every month, as this traffic is not passing through normal channels.

Well these are just allegations for now, and PTA has said that it will send replies on all these allegations along with documentary evidence to Cabinet Division within due course of time.

But just to mention here, a story published in ‘The Dawn’ – back in June 2010, had attributed the increase in ASR rate with PPPP’s government.

Paper had then said that increase in ASR had resulted into grey traffic valuing Rs. 30 billion a year. It further had said that leading beneficiaries of the grey traffic is a foreign company called Rodcom Europe (now being renamed as Hollywell Solutions), which is chaired by Rehman Malik, the sitting interior minister.

So the paper actually connected approved settlement rates (ASR) with PPP’s government and said that despite the plans of lowering it, PTA increased ASR as soon as PPP joined the government in February 2008.

Only time and inquiry will tell the real story – but sure, things are not as simple as they seem.

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  • pro desi

    I would really be nice if people mention purpose of their writing either at the start (Known as thesis statement) or conclusion of their writing in the last paragraph

  • Anas

    How could a decrease from US $ 0.10 to US $ 0.75, Its actually an increase of US $ 0.65, maybe typing error it should be corrected to US $ 0.075

    • BILAL

      Absolutely…