The Telecommunications Regulatory Authority (TRA) has issued for consultation a Draft Determination in which it proposes to set the cost of capital for regulated telecommunications services at 9.5%.
“The cost of capital is an important parameter that affects the cost base of operators and ultimately the price paid by consumers for telecommunications services in Bahrain. It represents the return that investors are able to earn on capital employed in the provision of regulated telecommunications services in Bahrain,” TRA in a statement said.
“In reviewing the cost of capital, TRA has examined the changes that have occurred since TRA last set the cost of capital in 2009, and has had regard to international best practice, the latest available market information, regulatory precedents and the current economic environment. Although the proposed cost of capital is unchanged from the level set in 2009, a number of parameters upon which the cost of capital is based have changed, and these are reflected in the Draft Determination. TRA considers that the proposed rate continues to provide the right investment incentives while preventing excessive profits,” the statement added.
The Draft Determination can be found on TRA’s Website at http://www.tra.org.bh/en/consultations.asp
TRA is inviting interested parties to submit on the Draft Determination, with submissions due by 4pm, Thursday 6 December 2012.