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Promoting Bermudian ownership, employment ‘thorny’ issue for new telecoms RA

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The new Regulatory Authority (RA) for Telecoms will have what it considers a “thorny” issue to deal with as it rolls out long-awaited reform of the sector this year.

Reform is intended to open up the sector and allow providers to finally hold Integrated Communications Operating Licences (ICOLS) to bundle calling, surfing and TV services.

But the Acts that usher in reform state the RA is obliged to promote Bermudian ownership and employment in the telecoms sector.

Both RA chief executive Philip Micallef and chairman Kent Stewart said this will be a “tough one” for the body.

One of the ways which the RA is considering, but still needs more consultation with stakeholders and Government on, is to have the fees adjusted on an operator's level of Bermudian ownership and employment.

“We will need to go out to the industry and see what this means,” Mr Stewart said, “It’s not an easy subject. It will be one of the most thorny issues.”

Mr Micallef, who comes to the Island from Malta where he was executive chairman of the Malta Communications Authority, admitted: “I have never come across this.”

The Electronics Communications and Regulatory Authority Acts of November 2011 were passed under the former PLP Government.

Mr Micallef said what they were seeking to do “could be beneficial in the short-term, but may not in the long-term” for Bermuda and Bermudians.

The RA could recommend to the new Government that the legislation be amended.

But the RA wants to seek input from the industry and public consultation on the statutory requirement.

The RA saying that for now it would “be premature” that in order to promote Bermudian ownership and employment it should recommend “that the Government authorisation fees to be paid by an ICOL holder be adjusted based on the degree to which the ICOL holder is ‘owned or controlled ... by persons possessing Bermudian status’ and ‘the proportion of each licensee’s employees possessing Bermudian status’.”

Currently, telecoms providers in Bermuda are subject to the general foreign ownership rule of minimum 60 percent local (Bermudian) ownership and maximum 40 percent foreign ownership (the 60/40 rule). The reality, however, is that several providers have obtained exemptions from the 60/40 rule and some are therefore allowed to have up to 60 percent foreign ownership and others are allowed 100 percent foreign ownership.

The RA will have to find a way to deal with the Bermudiansation issue so the playing field is level.

A 'tough one': RA chairman D. Kent Stewart and chief executive Philip Micallef. The Acts that usher in reform state the RA is obliged to promote Bermudian ownership and employment in the telecoms sector. (Photo by Akil Simmons) February 7,2013
Challenging issue: New RA chief executive Philip Micallef. The Acts that usher in reform state the RA is obliged to promote Bermudian ownership and employment in the telecoms sector. (Photo by Akil Simmons) February 7,2013

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Published February 11, 2013 at 8:00 am (Updated February 10, 2013 at 3:30 pm)

Promoting Bermudian ownership, employment ‘thorny’ issue for new telecoms RA

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