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Ukraine: Telephony in Villages before 2011 with Universal Service Fund Print E-mail
Friday, 07 April 2006
The National Communications Regulation Commission predicts that rural areas will be served by telecommunications network within near five years if bill 9193 on the creation of a universal service fund is approved in 2006.

"If the bill is passed, the issue of telephone network in villages will be settled in five years maximum," commission member Olha Filipova said.

In her words, UAH 500 million per annum will be dedicated to the development of communications in rural areas if the bill is passed. Filipova added that these funds would be drawn from a targeted increase in telecommunications service rates of 2%. These extra government revenues will be transferred to the fund. Commission representative Oleh Haiduk added that such a practice is widespread around the world where operators pay 1-5% of their revenues. The funds will be used to compensate national providers for servicing socially vulnerable citizens on benefits (20% of funds), and for the construction of communications lines in rural areas (80%).

Communications market participants and particularly the Internet Association of Ukraine oppose the proposed bill. The association expressed dissatisfaction with the mechanism for collecting funds. In addition, there is some concern over the increased authority of the State Communications Inspectorate and the National Communications Regulation Commission envisaged by the bill. The operators believe that increased powers will allow the agencies to interfere in the activities of cable TV network operators and TV and radio stations.

Ukrtelecom asked the cabinet to accelerate the creation of the universal service fund in order to compensate it for losses it suffers in providing communications services in rural areas.

Source: Ukrainian News, Tetiana Pleshyvtseva - WDR/Intelecon Regulatory News