The Telecommunications Authority will waive performance bonds due to be submitted in October from the four licensees for third-generation - or 3G - mobile services, to assist the industry in response to changing market conditions.

The bonds are in respect of the sixth and seventh licence year.

The Authority said the decision was made after careful consideration of the industry's needs and the steps other Governments have taken to help their 3G licensees.

Extending the waiver for one more year is an exceptional treatment unlikely to be offered next year in respect of the performance bond due in October 2004.

The 3G licensees have, on the grant of the licences in October 2001, either submitted performance bonds to guarantee the payment of the spectrum utilisation fee for the first five years, or paid the fee upfront for the first five years.

In October 2002, the Authority granted the 3G licensees a one-year waiver on the submission of performance bonds.

Therefore, this year's extension means that the Government has in hand guarantees for the payment of the spectrum utilisation fee or payment thereof for the next three years, the Authority said.

It stressed that the waiver does not affect Government revenue as the licensees are still required to pay the utilisation fee for all years within the 15-year licence period.

By accepting the waiver, the four licensees would not be required to submit a performance bond to guarantee the $60.124 million spectrum utilisation fee for the sixth licence year and of $70.249 million for the seventh licence year  - to be called in the event of serious default.