Getting A Permit: Guidelines For Telecom Operators

The recently promulgated Administration of Foreign-funded Telecommunications Enterprises Provisions  (外商投资电信企业管理规定) (the New Telecom FIE Regulations, see pages 30-35 and 48-55) should be read in conjunction with the Administration of Telecommunications Business Permits Procedures (Document No. 19) promulgated by the Ministry of Information Industry (MII) on December 26 2001, and which entered into effect on the same day as the New Telecom FIE Regulations.

No Permit, No Service Provision

Under the September 2000 PRC Telecommunications Regulations  (中华人民共和国电信条例) (the Telecom Regulations), all telecom operators in China must possess a telecom services operating permit1 before they are allowed to provide telecom services.  Document No. 19 governs the application for, approval and administration of such operating permits.

Types of Permits

Document No. 19 refers to three types of operating permits: the basic telecom services operating permit, the cross-regional value-added telecom services permit and the value-added telecom services operating permit.  In accordance with the Telecom Regulations, the operating permit for basic telecom services must be issued by the MII, and only PRC operators in which the state holds 51% equity are eligible for a basic telecom services operating permit.

A permit for cross-regional value-added telecom services allows the operator to provide inter-provincial services.  Again, the MII is responsible for issuing these operating permits.  It should be noted that the term "province" refers to provinces, autonomous regions and municipalities directly under the central government.

In contrast, a value-added telecom services operating permit enables the holder to provide intra-provincial services only, and is issued by provincial communications administrations.  Notably, in the case of foreign-invested telecom enterprises, the issuing authority for the operating permit is the MII.