Business - News - January 27, 2022

FEC approves new revenue model for NCC to help generate N1.2trn in 10 yrs

MEDIATRACNET

A new revenue generation model has been approved for the Nigerian Telecommunications Commission (NCC) and the Federal Ministry of Communications and Digital Economy.

The new model approved by the Executive Council of the Federation on Wednesday would help raise about N1.2 trn in the next ten years.

The design, finance, build, operate and transfer (DFBOT) public-private partnership (PPP) model called Revenue Assurance Solution (RAS) was approved following the review and issuance of compliance certificate of the Full Business Case (FBC) by the Infrastructure Concession Regulatory Commission (ICRC).

The RAS was designed by the Nigerian Telecommunications Commission (NCC) and the Federal Ministry of Communications and Digital Economy (FMCDE) to boost the collation and collection of Annual Operating Levy (AOL) from the digital network operators in the country.

With the approval by FEC and the mandatory vetting for regulatory compliance by the Federal Ministry of Justice, the next stage would be the commercial close – contract execution, with Messrs 3R Consortium as the Private Partner.

The RAS model which would span a 10-year period, is expected to help increase the revenue accruals from AOL to about N1.21 trillion within the period.

The ICRC said the NCC proactively initiated the process for the deployment of an RAS with the aim of blocking revenue leakages from the system, by ensuring there were no errors in computing and collection of the AOLs due to the Federal Government.

“The RAS is expected to block possible gaps in revenue accountability, using cutting-edge technology solutions and shall provide additional layer of assurance that the licensees of the Commission pay the correct Annual Operating Levies and meet other regulatory obligations without any miscalculations and/or exemptions based on faulty and inaccurate data and information”, the ICRC said in Abuja.

“The deployment of the RAS platform will significantly improve the NCC’s current AOL revenue computation and collection system, amongst other benefits’’, the Commission added.

The AOL regulations came into force via a 2014 gazette by the Federal Government as an addendum to the NCC Act of 2003.

It stipulates in part that: “Every Licensee that is a Network Operator shall pay to the Commission an Annual Operating Levy assessed at two and a half percent of the Licensee’s Net Revenue for the relevant period being its Gross Revenue less its Roaming, Interconnect and Bandwidth Costs for the period”.

Also, it said: “Every Licensee that is a non-Network Operator shall pay annually to the Commission an Annual Operating Levy assessed at one percent of the Licensee’s Net Revenue for the relevant period being its Gross Revenue less its Roaming, Interconnect and Bandwidth Costs for the period”.

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