Business leaders criticise government decision to appoint administrators for GP, Robi

Business leaders yesterday criticised the decision to appoint administrators for private mobile phone operators – Grameenphone and Robi. They warned that it would set a bad example to entrepreneurs.

Such a drastic decision would send a negative message to foreign investors as well, they added.

Speaking to The Business Standard, Abdul Matlub Ahmad, former president of the Federation of Bangladesh Chambers of Commerce and Industries (FBCCI), said this decision would discourage both local and foreign investors.

"Both parties had the responsibility to resolve this dispute before it reached this point. It is very clear that there is a lack of communication between government offices and private companies," he opined.

As an entrepreneur, Abdul Matlub believes that government offices should responsibly handle foreign investors and large taxpayers.

Unfortunately, everyone is being treated the same, he said, adding that for such practice and attitude of government offices, over 50,000 cases relating to commercial disputes are pending in the courts.

"Foreign investors and large taxpayers deserve sophisticated or VIP treatment from government officials," said Matlub, who is also the chairman of Nitol-Niloy Group.

He suggested that a separate Alternative Dispute Resolution cell, headed by a retired judge, should be formed to resolve such high profile disputes.

The government may consider the role of telecom operators Grameenphone and Robi, adding that the country's economy is almost 70 percent dependent on these two operators' services.

"If their service is disrupted for this reason, it will have a negative impact on the whole sector," he added.

The Foreign Investors' Chamber of Commerce & Industry (FICCI) President Shehzad Munim said that this decision of the government is totally unexpected.

Foreign companies are willing to do business in accordance with the "law of the land," but they want to do business in their own style, he added.

"When the government attempts to appoint administrators, it carries a message that they are willing to get their demanded money [tax] by force," said the FICCI president.

Such administrators will act as barriers for the company in taking regular decisions in future.  

"This decision will make foreign investors rethink investing or reinvesting in Bangladesh," said Shehzad Munim, also the CEO of British American Tobacco Bangladesh.

Bangladesh Malaysia Chamber of Commerce and Industry (BMCCI) President Syed Moazzam Hossain termed the government's decision as "shocking."

If the government has any dispute with a foreign company, they should resolve it. "Appointing administrators is not the solution," he added.

Moazzam further said that foreign companies are used to doing business in their own way and that they could not run under the supervision of administrators.    

Bangladesh made its way into digitisation with the help of telecom multinationals in the early '90s. But the relation between telecom regulators and operators over payments have not been sweet over the years.

Licensed in 1989 as the country's oldest mobile phone operator, Citycell was shown the doors in October 2016 after the company failed to clear Tk477.51 crore in overdue fees claimed by the Bangladesh Telecom Regulatory Commission.

Singtel of Singapore owned a 45 percent stake in Citycell, while Pacific Group and Far East Telecom owned the rest. The mobile operator had 0.14 million subscribers when it was shut down.

The latest row between the telecom regulatory commission and the two leading mobile operators surfaced in April this year, after the regulator came up with a sudden claim of over Tk13,400 crores in fees and fines.

Grameenphone started operating in Bangladesh in 1997, and listed with the stock market in 2009. Norway-based Telenor holds 55.8 percent of its shares, Grameen Telecom owns 34.2 percent, while general and institutional investors hold the remaining 10 percent.

It has emerged as the largest mobile phone operator in Bangladesh with 75.6 million customers.

Aktel was launched in 1997 as a joint venture of local AK Khan Group and Telekom Malaysia. It was later rebranded as Robi Axiata in 2010, after Malaysia-based Axiata bought its shares.  

Axiata now owns 68.7 percent of Robi, while Indian Bharti Airtel owns 25% and Japan's NTT Docomo owns 6.3 percent of the company.

It is currently the second largest mobile operator in Bangladesh, with 47.7 million subscribers as of August.