OFTA delay sparks 'lame duck' fears
AN apparent slippage in the timetable for setting up Hongkong's proposed Office of the Telecommunications Authority (OFTA) has led to widespread industry speculation that the new regulatory body may not get the adequate specialist resources that were originally proposed last December.
Industry watchers complained that the Government appeared to be haggling over what skills should be attached directly to OFTA and what should be ''borrowed'' from the general civil service skills pool.
They argued that Hongkong was in danger of being left with a ''lame duck'' regulator without the resources to effectively oversee the introduction of competition.
Potential second-network investors seeking to compete in the local market after 1995 would be reluctant to pursue multi-billion dollar projects without assurances of adequate protection against any unfair practices by the dominant incumbent, Hongkong Telecom.
Seven consortiums lodged bids with the Government in early February for licences to establish fixed-line networks in competition with Hongkong Telecom after applications were called last September.
Telecom consultant Mr Henry Wise, a former deputy Postmaster General, said the success or otherwise of the Government's plan to introduce local competition after 1995 would depend on the ability of the Telecommunications Authority to make quick regulatory decisions.
That depended on it being given adequate resources, he said.
''Many of the bidders who put forward proposals did so on the basis that [the] Government would do what it had implied - set up a streamlined and well-resourced regulatory authority,'' said Mr Wise, who acts as a consultant for the Wharf Group, which is a bidder for a fixed-network licence.
''If [OFTA director general-designate Mr Alex Arena] does not get the resources he has asked for - or at least most of the resources - then the competitive telecom scene in Hongkong will simply fade away,'' Mr Wise said.
''Competition will cease to be an issue,'' he said.
''What OFTA needs is its own economists, its own accountants, its own legal advisers, and obviously its own telecommunications advisers,'' Mr Wise said.
Government plans call for OFTA to be established sometime in the second quarter.
Although two telecom amendment bills that provide the legal framework for the new authority are still before the Legislative Council, OFTA director general-designate Mr Alex Arena said he was confident the deadline could be met.
Hongkong Telecommunications User Group (HKTUG) deputy chairman Mr Peter Mahoney said it would be extremely difficult to properly regulate a competitive telecommunications market relying on ''generalist'' civil servants for essential skills sets, as happens in other parts of the Government.
''Telecom is different - it changes so fast that even specialists have trouble keeping up with it,'' Mr Mahoney said.
''It would seem sensible to us (HKTUG) that dedicated resource specialists - legal specialists, economists - were brought in-house,'' he said.
The Government announced its plan last December to split the Telecommunications Authority away from the Post Office structure - to oversee a pro-competitive telecommunications policy, with the two bills put to the Legislative Council at that time.
The Government had hoped to implement its telecommunications changes in January - including an agreement with Hongkong Telecom to reduce international direct dialling charges by 12 per cent over three years and a new inflation-minus-four per cent price control mechanism to govern local tariffs.
The proposed legislation is currently with the Legco bills committee and is unlikely to get back to the full council before April.
Hongkong Telecom director of regulatory affairs Mr Rick Tang said the company expected a Legco decision no earlier than April.
