Maltacom and government to strike Lm62m compensation deal

by Franco Aloisio

A few days after the publication of the draft Telecommunications Bill, Maltacom and the government are finalising a Lm62m compensation deal, reliable sources said yesterday.

A few months ago, Maltacom chairman Maurice Zarb Adami said in an interview that Maltacom was claiming Lm100m in compensation as a result of relinquishing its present monopoly in 2003, seven years before the original deadline of 2010.

The sources said that several meetings were held between the two sides, during which the amount to be given to Maltacom as compensation was negotiated. The nature of the compensation was also negotiated.

Following these meetings, the two sides are now in the process of finalising the compensation agreement, which will be around the Lm62m figure, an amount which suits both Maltacom and the government, the sources said.

The Lm62m compensation will include Maltacom's license to operate mobile telephony services, through its subsidiary - Mobisle. Moreover, the agreement is expected to include a proviso by means of which the government will finance the retraining and redeployment programmes of Maltacom's employees.

The sources said that a substantial part of Maltacom's compensation will be used to finance "golden handshake" schemes, similar to those adopted at Kalaxlokk.

The national plan for the reform of the telecommunications sector, which was included in the draft bill, also stated that the government will finance the retraining programmes. The plan said: "... the government will enter into discussions with Maltacom with a view to providing for and assisting it in the carrying, retraining, redeployment or early retirement of any staff complement surplus."

Another section of the plan states: "The government is convinced that Maltacom will be a net beneficiary from liberalisation."

Meanwhile Maltacom next week is expected to announce two special offers. Customers who will decide to install a second telephone line will be exempt from paying the annual Lm24 rent on the second line. This offer will be tested on a pilot basis in Gozo, and will then be extended nation-wide.

The second offer consists of a 20 per cent reduction over the payment of rental fees over a five-year period. Households and businesses who pay their rent for a five-year period, will have their fifth year free of charge. Households pay Lm24 per year for every telephone line, while business pay Lm52.

Meanwhile, customers will pay just 1c per minute for international calls made on Mothers' Day, on Sunday 14 May.