Flash Report /
Bangladesh

Grameenphone to pay BDT10bn; court's demand unchanged for now

    IDLC Securities
    20 February 2020
    Published byIDLC Securities

    According to reports, the Appellate Division of the Supreme Court (ADSC) today instructed Grameenphone to deposit BDT10.0bn (US$117.6mn, half of the ADSC’s demand, 8% of the total dispute claim) by Monday, 24 February 2020. The court will provide further instructions about the rest of the payment (BDT10.0bn or US$117.6mn) on the same day.

    The ADSC had asked Grameenphone (GP) to pay BDT20bn (US$235.3mn, c16% of total audit claim) to continue a stay-order on the non-issuance of No Objection Certificate (NOC) by 24 February 2020. GP then filed a review petition to pay BDT5.7bn (US$67.8mn, 4.5% of the total audit claim) instead on 26 January 2020. The final verdict on the review petition was supposed to be announced today. 

    Our interpretation of today’s development is that the court’s demand for BDT20bn (US$235.3mn) remains unchanged. GP must pay half of the amount, ie BDT10.0bn (US$117.6mn) by Monday. The payment of the rest of the amount is subject to the final verdict. The ADSC has the authority to waive the remainder of the payment or provide the opportunity to pay it by a flexible schedule or in installments. Therefore, the amount GP has to pay to continue the stay-order ranges from BDT10.0bn (US$117.6mn) to BDT20bn (US$235.3mn). 

    Note that this stay-order is important for GP to get an NOC from the Bangladesh Telecommunication Regulatory Commission (BTRC). Without the NOC (a kind of regulatory approval), GP will struggle to continue its usual business operation. Also note that this payment for the stay-order is not the final verdict on the total dispute of BDT126bn (US$1.5bn).  

    So far, we have not received any official statement from Grameenphone.