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Viewing cable 06JERUSALEM1286, FIL MISH-MISH": PA ISSUES TENDER FOR MOBILE

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Reference ID Created Released Classification Origin
06JERUSALEM1286 2006-03-29 15:09 2011-08-24 01:00 UNCLASSIFIED//FOR OFFICIAL USE ONLY Consulate Jerusalem
VZCZCXYZ0002
OO RUEHWEB

DE RUEHJM #1286 0881509
ZNR UUUUU ZZH
O 291509Z MAR 06
FM AMCONSUL JERUSALEM
TO RUEHC/SECSTATE WASHDC IMMEDIATE 1261
INFO RUEHXK/ARAB ISRAELI COLLECTIVE IMMEDIATE
RHEHNSC/NSC WASHDC IMMEDIATE
UNCLAS JERUSALEM 001286 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
NEA FOR FRONT OFFICE; NEA/IPA FOR WILLIAMS/GREENE/WAECHTER; 
EB/CIP FOR GROSS/BOEHME/GIBBS 
 
E.O. 12958: N/A 
TAGS: ECPS TINT TSPL PGOV KWBG
SUBJECT: "FIL MISH-MISH": PA ISSUES TENDER FOR MOBILE 
OPERATOR IN PALESTINIAN TELECOM MARKET 
 
REF: 2005 JERUSALEM 4508 
 
1.  (SBU) Palestinian Authority (PA) Telecom Ministry issued 
a tender March 28 for eligible strategic partners to bid on a 
30 percent share of a second mobile telecom operator in the 
West Bank and Gaza.  This operator would be granted a new 
license to establish and operate a GSM telecom network and a 
third generation (3G) network, as well as provide 3G services 
and international services as of November 16, 2006. 
Interested entities must purchase the request for application 
(RFA) from the Telecom Ministry for JD 2,000 (USD 2,821) and 
submit bids and accompanying documentation by June 26. 
(Note: A copy of the RFA was emailed to NEA/IPA and EB/CIP. 
End Note.)  In addition, the interested parties are required 
to pay an application fee of JD 20,000 (USD 28,210) for the 
fees of the Advisory Firm tasked with processing and 
selecting the winner of the bid to be announced July 6. 
 
2.  (SBU) According to the RFA, in order to be eligible to 
submit an application, an applicant must: 
 
-- have had substantial experience in the operation of a 
mobile telecommunications network and in the provision of 
mobile telecommunications services for at least three years, 
having at least 300,000 subscribers as of December 31, 2005; 
 
-- have developed such experience as a new entrant competing 
with an incumbent mobile operator; 
 
-- have had such experience by direct involvement either as 
the operator itself or through a comprehensive management 
contract giving the applicant substantially full control of 
the operation of the network, provision of services and 
overall running of the business; 
 
-- neither be a significant shareholder in a mobile 
telecommunications company in the West Bank/Gaza, directly or 
indirectly, nor have a significant share of its owns share 
capital be held, directly or indirectly, by a mobile 
telecommunications company in the West Bank/Gaza or any of 
its controlling shareholders (for the purpose of its RFA, a 
significant share means 10 percent and controlling means 
shareholding over 50 percent); 
 
-- be organized under the laws of a country in which 
Palestinian companies are permitted to apply for licenses to 
operate telecommunications networks and provide 
telecommunications services; and 
 
-- have had annual gross revenues of at least JD 150 million 
(USD 212 million) over each of its last three financial 
years. 
 
3.  (SBU) PA Telecom Ministry Advisor Masshour Abudaka told 
EconOff March 28 that the PA is looking for a strategic 
partner with strong Israeli relationships in order to 
persuade the GOI to grant additional mobile frequencies.  He 
said the new mobile operator would ideally be able to operate 
in both Israel and the West Bank in order to compete with 
other mobile operators in the region.  He added that the 
Palestine Investment Fund (PIF) would also own a 30 percent 
stake in the pro forma ownership structure, while Palestinian 
telecom partners would own 10 percent, and public 
shareholders the remaining 30 percent. 
 
4.  (SBU) Comment: The outgoing PA Minister of Telecom Sabri 
Saidam has been working on liberalizing the market for the 
duration of his tenure in office and succeeded in issuing 
this tender only two days before he left office.  However, as 
an Arabic saying aptly expresses, it will likely happen "fil 
mish-mish" or in the time of apricots, meaning not at all. 
The combination of the incoming Hamas government and the fact 
that the GOI has yet to assign additional mobile frequencies 
to the PA suggests that this initiative will fall by the 
way-side.  End Comment. 
WALLES