Information memorandum issued on FM e-auction

The government today issued an Information Memorandum, detailing rules and applicable timetable for the first batch of e-auction of 135 channels of private FM Radio in 69 cities in the country.
The Information and Broadcasting Ministry has issued the Information Memorandum in continuation to the Union Cabinet's approval on January 16 for conduct of FM Phase-III auctions for these channels and migration (renewal) of Private FM Radio licenses from Phase-II to Phase-III.
"In the case of the first batch, the government has decided to auction up to 135 channels in the 69 cities of Phase 2 where vacant or additional channels of Ph 2 are available," the Information Memorandum said.

Among the cities for which auction has been proposed are Chennai, Delhi, Mumbai, Ahmedabad, Bangalore, Hyderabad, Jaipur, Kanpur, Lucknow, Nagpur, Pune and Surat.
Apart from these, Amritsar, Varanasi, Ajmer, Akola, Jhansi, Tiruchi, Agartala, Aizawl are also included in the list.
Issuance of the Information Memorandum is part of the process of FM Phase III Policy for expansion of FM Radio Broadcasting through private agencies.

The Memorandum comprises rules and timetable applicable to the auction and is aimed at informing prospective bidders about steps they need to take in order to pre-qualify and take part in the forthcoming auction.
The Memorandum is for information purpose only and has no binding force, an official statement said.

Broadly, it outlines the government's expectations in relation to the proposed auction. All information contained in it is subject to updation, modification and amendment and does not purport to be complete, it said.
The Ministry has clarified that the Memorandum is not intended to form any part of the basis of any investment.
Also, neither does it constitute an offer or invitation to participate in the auctions, nor does it constitute the basis of any contract which might be concluded in relation to the auction.
"It has been put in public domain to merely supplement and update Phase III Policy guidelines and to acquaint prospective bidders with the design of ascending e-auction," the statement said.

The Ministry will separately issue a Notice Inviting Applications (NIA) for participation in the auction which would be definitive and would take precedence.
The proposed auction process will add an estimated revenue of over Rs 550 crore to the national exchequer on successful auctions of all proposed channels.
Besides, it will bring in the amount realised through the migration process for FM channels to move to Phase III regime from the current Phase II.
The migration fee for existing channels, will be as per a TRAI recommended formula which links it with market prices estimated through the FM Radio Phase III auction.