Article: China + fibre-optics
Friday, April 6, 2001
China bans illegal fibre-optic networks
REUTERS in Beijing
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China has started regulating construction of long distance fibre-optic networks, banning projects without government approval, the official China Daily said on Friday.
The State Development Planning Commission and the Ministry of Information Industry had started to inspect fibre-optic network resources as many companies had invested in the hope of gaining a larger share of the broadband communications market, it said.
Illegal construction had caused overlapping of networks, wasted large sums of money and impeded the government's attempts at regulation, the newspaper said.
Companies that were not licensed to offer basic telecommunications services but were using optical fibre resources must report to the government within 30 days, it said.
The Ministry of Information Industry would issue licences to telecommunications operators for network leasing and sales soon to ensure an orderly competitive environment, China Daily said.
Licence holders would be able to lease and sell network bandwidth and optic fibre networks, and could buy networks set up illegally which were confiscated by the government, it said.
Overseas capital - including funds from Hong Kong, Macau and Taiwan - was banned from direct investment in telecoms network construction and operation before China's entry into the World Trade Organisation, the newspaper said.
China-backed conglomerate Citic Pacific, which is listed in Hong Kong, said on Friday its fibre-optic network project was approved by authorities and would not be affected by Beijing's order putting non-approved projects on hold.
Citic Pacific has no telecoms licence in China but the company was granted special approval to invest in, build and own the nationwide China Express No1 backbone Network in China, managing director Henry Fan said.
Mr Fan said Citic Pacific's fibre-optic network would not be affected by the directive and that its parent, Citic Beijing, had applied for a full telecommunication licence.
Citic Pacific said earlier that it was in talks with a licensed mainland telecommunications operator to lower its interest in China Express No1 to below 49 per cent from 60 per cent.
Mr Fan declined to identity the potential partner. But merchant banking sources said Citic Pacific was in talks with China Satellite Communications Group, a spin-off of China Telecom.
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