DoT Defines New Basis For Computing License Fees

On 25 October 2021, the Department of Telecommunications, Government of India (DoT) issued a landmark amendment (Amendment) to the telecom license conditions. The Amendment ushers in a new dawn for the telecom licensing regime in India by redefining the basis of 'adjusted gross revenue' (AGR). AGR has been the basis of computing the license fees payable by a telecom licensee and has been a subject of debate for at least the past couple of decades. This is primarily because the definition of 'gross revenue' (Gross Revenue) under each service authorisation, which in turn forms the basis of AGR, has thus far taken into the consideration the entire revenue of an entity (including revenue from non-telecom activities).