Trai suggests changes to M&A rules to speed up closure

Kolkata: The telecom regulator on Friday recommended changes to the merger & acquisition (M&A) rules with an aim to speed up deal closures and reduce legal disputes.

The Telecom Regulatory Authority of India (Trai) has suggested that in case of a judicial intervention on the issue of one-time spectrum charge (OTSC) in M&A deals, the ”transferor” or seller entity and not the ”transferee” (read: buyer) should give a bank guarantee, equivalent to the demand raised by the Department of Telecommunications (DoT).

Mahesh Uppal, director at Com First (India) and an expert on spectrum regulatory matters, said “Trai’s suggestion, if accepted by the government, could speed up closure of M&A deals and reduce the likelihood of disputes between the company acquiring a telco and the government as the acquired spectrum would be unencumbered”.