Fri. Jun 14th, 2024

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Ncell Axiata Quits Nepal! What You Need to Know About the Legal Battle and Regulatory Drama!

Ncell Axiata quits Nepal

In a seismic shift, Axiata Group Berhad declared its exit from Nepal, marking the end of a seven-year stint. The conglomerate’s decision to sell its 80% equity stake in Ncell Axiata Limited to Spectrlite UK Limited has stirred controversy, unleashing a legal battle with Nepali regulators. Axiata cites the challenging business environment, characterized by unfair taxation and regulatory uncertainties, as the primary reasons for its withdrawal.

Axiata’s Group CEO, Vivek Sood, emphasized the fundamental shift in the operating environment that led to this strategic decision. The abrupt exit, valued at a fixed consideration of $50 million, has caught the attention of Nepal’s telecommunications authority, NTA. A potential legal confrontation looms as Axiata allegedly failed to inform the NTA about the sale, triggering concerns about regulatory non-compliance.

Ncell Axiata quits Nepal

The legal saga extends beyond Nepal’s borders, with the sale involving Spectrlite UK, owned by Satish Lal Acharya, a person of Nepali origin based in Singapore. Questions arise over the deal’s transparency, as Axiata remains tight-lipped about the conditional consideration and potential windfall gains for the purchaser until 2029. The NTA, invoking regulatory clauses, insists on approval for transactions involving more than 5% of a licensed entity’s capital, further complicating the matter.

As the dust settles, the NTA, led by Purhusottam Khanal, contemplates its next move, with potential legal challenges looming. Even Prime Minister Pushpa Kamal Dahal weighs in, emphasizing the need for a thorough study before granting approval. The intricacies of tax regulations, ownership changes, and potential legal battles paint a complex picture, leaving Ncell Axiata’s fate hanging in the balance.

In the backdrop of geopolitical tensions surrounding telecom technology globally, Axiata’s departure raises broader questions about regulatory oversight, taxation policies, and the intricate web of international business dealings. The exit of this telecom giant marks a turning point, triggering not only legal battles but also sparking a national discourse on the implications of foreign investments in Nepal’s telecom landscape.