Telecom operators may be allowed to index tariffs annually above inflation

Telecom operators may be allowed to index annual tariffs for services, including those higher than the consumer price index. This is stated in the draft Strategy for the development of the communications industry of the Russian Federation for the period up to 2035, published on the website of the Ministry of Digital Development.

One of the objectives of the strategy is to provide quality communication services and Internet access. This, in turn, requires additional sources of financing the capital expenditures of market participants.

“One of the sources of financing may be the annual indexation of tariffs for communication services. At the same time, the approach to determining the amount of allowable indexation should be differentiated and dependent on the purposes for which the telecom operator uses the additional profit (due to indexation of tariffs),” the document says.

If operators reinvest a significant part of the additional profit in significant projects, then “such a telecom operator may be allowed to index tariffs at a level exceeding the consumer price index by a value set by the regulatory authorities,” the draft specifies.

In connection with this proposal, organizational and legal measures may be introduced that will “tie” the sources of project financing to additional profits from tariff indexation. At the same time, indexation of prices within the limits of inflation will be considered reasonable if this ensures the stability and uninterrupted operation of the infrastructure.

August 11 Maksut Shadayev, head of the Ministry of Digital Development informedthat the ministry, together with the Federal Antimonopoly Service, is developing a mechanism according to which telecom operators will have to justify the planned increase in tariffs.

On April 20, the largest telecom operators complained to the head of the Ministry of Digital Development Maksut Shadayev about a sharp rise in the cost of connecting communication equipment to the power grid, warning of an increase in tariffs for subscribers and a slowdown in the construction of networks.

In June, Kommersant wrotethat at a session to discuss the development of the industry, operators asked to be allowed to raise communication tariffs annually at a level exceeding inflation by 5%. The ministry then emphasized that tariff indexation is possible only if several conditions are met, growth should be smooth, operators need to provide a differential approach.