No two telcos can merge in a circle: TRAI

New Delhi, Aug 29 (UNI) Anticipating a monopolistic situation arising in the Indian telecom sector, the telecom regulator TRAI today said no two dominant players can merge and form a single entity in a circle.

''The recommendations are conducive to future technology and that the M&A norms are intended to avoid the merger of top two players in a circle,'' TRAI Chairman Nripendra Misra said here.

In its suggestions forwarded to the government, the regulator made it difficult for the telecom biggies to merge in a circle, and suggested that crossholding limit is likely to be raised to at least 20 per cent from 10 per cent.

The number of players in each circle should be left to market forces, TRAI said.

The minimum service providers per circle has been raised to four from three and that the automatic approval for cross holding has been raised to 20 per cent from 10 per cent while the M&A dominance criterion has been brought down to 40 per cent from 67 per cent, Mr Misra said.

This will ensure a level-playing field, he said.

TRAI has also made it clear that dominance of market players should not be more than 40 per cent if a merger takes place.

It has also said that no M&As will take place in circles which has less than four operators.

The M&A dominance criteria will be based on subscribers and AGR, it said, adding that the 15 MHz ceiling in M&A has been removed in case of M&A.

UNI