Camilo Thame, Business Reporter

Philip Paulwell, Minister of Commerce and Technology. - contributed

Technology minister Phillip Paulwell last week stepped back from plans to direct payment of the universal service levy directly to the Universal Access Fund Company (UAFC) in the face of criticism.

Industry players argued that by circumventing terminating carriers, which now collect the cess from international call carriers, Paulwell would further fog the situation surrounding non-payment of the tax for a year by at least one carrier.

Paulwell, several weeks ago, had instructed local telecomms through a ministerial order that the "requirement that terminating carriers shall collect payment of the levy from interconnect customers is hereby suspended and such payments are to be made directly to the UAFC."

But in an interview last Thursday Paulwell told Wednesday Business that the order was "not gazetted" and that his ministry "would not go ahead" with it.

He did not indicate why, but at least two reliable industry sources confirmed last week that the order was sent then withdrawn after being heavily criticised for fostering lack of transparency.

The fund which was created last year with the implementation of the funding mechanism on June 1 - a levy on international calls terminating in Jamaica of three U.S. cents per minute on fixed line and two U.S. cents per minute on mobile networks - came under heavy criticism by industry players last month when it was revealed that at least one international call carrier had not paid the levy.

According to one source, People's Telecom had not paid the cess since its implementation and racked up arrears of over J$30 million.

Keisha Hamilton, People's Telecom's chief operating officer, said she would not comment on the size of the arrears, but reaffirmed her company's opposition to the cess.

'Payments under protest'

"Based on how the market is now, we're not the only ones who owe money," Hamilton told Wednesday Business on Friday. "We've always been opposed to the cess and make our payments under protest."

The firm did not have its operation suspended as per a previous ministerial order that instructed the disconnection of nonpaying carriers and eventually suspension of their licences.

Hamilton denied claims by sector players that it was undercutting the market, saying that People's Telecom was meeting its payments to Cable & Wireless Jamaica and government.

Unlike several international carriers, including AT&T, MCI and British Telecommunications, that were blocked for a number of days because they did not agree to make the payments by the implementation date.

Industry players claimed Paulwell had intervened on behalf of at least one delinquent player. But the technology minister flatly denied interfering with the process since implementing the first ministerial order in April last year.

The only action, he took, said Paulwell, was to issue instructions to the Office of Utilities Regulations (OUR) to oversee the matter.

The OUR, according to a second ministerial order, was to 'conduct and investigation of the operation of the regime and payment of the universal service levy.'

The OUR, however, is not currently undertaking an investigation according to director of consumer and public affairs, David Geddes, but the telecomms regulator instructed nonpaying carriers in a letter dated November 15 to "conclude arrangements for payment by November 22 and all such arrears must be cleared up by December 31, 2006."

To date the fund has $2.3 billion in collections and receivables and by Paulwell's estimation should make $4.2 billion by the end of its tenure in June 2008.

That projection is 40 per cent more than initially estimated for collections to fund Jamaica's e-learning project, which will bring internet access to schools islandwide and multimedia learning tools in the classroom by the end of the project.

camilo.thame@gleanerjm.com

The error has been brought to our attention, and we are satisfied that our source was indeed inaccurate. We, threfore, unreservedly apologised to People's Telecom and regret any inconvenience or embarrassment the publication may have caused.