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Aug. 8, 2003


PR No. 27


CPA Announces Important Changes to Wireless Telephone License Requirements


The Coalition Provisional Authority (CPA) released today two significant changes to the bid requirements for wireless telephone service in Iraq. CPA adopted the changes—opening the process to state-owned telecommunications firms and reducing the bond requirement—in response to concerns expressed by numerous bidders that certain conditions precluded their participation or were unduly onerous.


The most significant change adopted by the Ministry was to increase the possibilities of participation in licensing by companies owned in part by foreign governments. Before today, companies more than 10% owned by a foreign government could not participate. Under the new requirement, they may participate, so long as total foreign government participation in a bidding consortium does not exceed 10%.


“We would have preferred zero percent ownership by foreign governments in Iraq’s system, obviously, but as a compromise we agreed to 10 percent at the absolute highest,” said Dr. Shakir Abdulla, Secretary General of the Ministry of Transportation and Communications.


This change opens the bidding process to most companies world-wide, even if they are wholly state-owned, provided that company’s ownership of a consortium does not exceed 10 percent.


The second change reduces the cost of the performance bond required to be secured as part of the license. The original rule required a bond for the full price of the build out, thought by some to impose a very significant bonding fee for a build out estimated at $150 million. The new rule requires bonding to $30 million at a substantially reduced cost.


“We have provided a level playing field for all interested parties to submit substantive bids for wireless communication in the three designated regions,” said Ambassador L. Paul Bremer, CPA Administrator. “We are proceeding at a rapid pace in this endeavor because Iraq must have a modern communications system for voice and data to jump start the post-war economy.”


The Iraqi Ministry of Transportation and Communications, under the auspices of the CPA, will issue licenses for three wireless telephone operators in September. Licensees will initially provide service in one of three Iraqi zones, north, central and south. However, to encourage rapid deployment of services, licensees meeting growth goals are given the right to expand throughout Iraq.


The CPA believes the changes adopted today will encourage more companies to participate in the bid process and thereby increase the likelihood that its objectives for the rapid build out of sophisticated wireless mobile networks throughout Iraq will be achieved.


The Ministry has designed the bid process to create three vigorous nation-wide competitions in little more than one year, bringing to Iraqi citizens a wide choice in services and price in an accelerated period.


Notes for editors:


Bidders must submit their proposals by Aug. 21, and selection is expected by September 5, 2003. The Ministry convened a conference on July 31 in Amman, Jordan, in which more than 400 individuals representing 300 companies attended, to comment on a preliminary version of its licensing proposal. After careful review of statements provided by participants, the Ministry issued final requirements on 3 August. These two changes modify the Aug. 3 requirements.


Modifications will be  available on the CPA web site at




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