XN000022-1992-07-06 — Page 9

MONDAY, JULY 6, 1992

THE LEVEL FOR THIS SUB-CAP REMAINED TO BE DETERMINED, BUT WOULD CERTAINLY NOT BE GREATER THAN INFLATION, SHE SAID.

ON THE FUTURE REGULATORY BODY FOR TELECOMS IN HONG KONG, MRS CHAN SAID THE GOVERNMENT ACCEPTED THAT TELECOMS WAS A DYNAMIC BUSINESS AND THAT WHAT WAS AN ADEQUATE REGULATORY STRUCTURE TODAY MIGHT NOT ADEQUATE FOR THE FUTURE COMPETITIVE ENVIRONMENT.

BE

AND

"THERE IS A NEED FOR MORE RESOURCES AND FOR MORE FINANCIAL ACCOUNTING EXPERTISE AT THE SHARP END OF TELECOMS REGULATION. THE STATUTORY REMIT OF THE TELECOMMUNICATIONS AUTHORITY ALSO REQUIRES STRENGTHENING.

"CONSIDERABLE SUPPORT HAS BEEN EXPRESSED BY LEGISLATIVE COUNCILLORS, BY THE INDUSTRY AND BY USERS FOR THE ESTABLISHMENT OF A SEPARATE REGULATORY BODY SIMILAR TO THE UK'S OFTEL.

"WE ARE GIVING THIS IDEA SERIOUS CONSIDERATION, AND EXPECT TO MAKE AN ANNOUNCEMENT ON THE FUTURE REGULATORY BODY SHORTLY," SHE SAID.

MRS CHAN POINTED OUT THAT THE GOVERNMENT IS OPEN-MINDED OVER THE APPROACH ΤΟ LICENSING COMPETITION TO THE HONG KONG TELEPHONE COMPANY.

THE MAIN OPTIONS APPEARED TO BE TENDERING FOR A SECOND NETWORK OR OPEN LICENSING,

"So FAR OUR SOUNDINGS HAVE INDICATED STRONG SUPPORT FOR A MARKET DRIVEN APPROACH, THAT IS LETTING THE MARKET DECIDE HOW MANY ADDITIONAL NETWORKS IF ANY IT WANTS.

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SHE SAID THIS WAS AN APPROACH THAT WOULD SIT WELL WITH THE GENERAL PHILOSOPHY IN TELECOMS POLICY OF MAXIMISING OPPORTUNITIES FOR CHOICE AND COMPETITION IN ALL SECTORS, WHERE EXISTING FRANCHISE AND LICENCE AGREEMENTS ALLOWED THIS.

"WE

INTEND TO MAKE AN ANNOUNCEMENT ON THE LICENSING FRAMEWORK BY THE END OF THIS MONTH TO ASSIST PROSPECTIVE BIDDERS FOR SUBSCRIPTION TV IN ASSESSING THE POTENTIAL FOR PROVIDING TELECOMS SERVICES OVER THEIR NETWORKS, MRS CHAN SAID.

"

SHE SAID THE GOVERNMENT HAD TAKEN A SIGNIFICANT STEP FORWARD IN FURTHER LIBERALISING THE LOCAL MARKET WITH ITS RECENTLY ANNOUNCED POLICY FRAMEWORK.

**WE FULLY INTEND TO ENSURE THAT OUR REGULATORY FRAMEWORK CONTINUES TO ADAPT AND CHANGE IN LINE WITH CONSUMERS' DEMANDS AND THE RAPID TECHNOLOGICAL ADVANCES IN THE ENTIRE TELECOMMUNICATIONS MARKET.

"CONSUMERS' INTERESTS ARE BEST SERVED BY PROVIDING THE WIDEST POSSIBLE CHOICE AT REASONABLE PRICES WHILST ENSURING THAT THE BUSINESS ENVIRONMENT REMAINS SUFFICIENTLY ATTRACTIVE TO ENCOURAGE CONTINUED INVESTMENT IN STATE-OF-THE-ART TECHNOLOGIES IN THIS VITAL FIELD," SHE SAID.

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