Baghdad will fine the country’s three mobile phone operators within weeks for breaching the terms of the licences they won in August 2007, according to a government adviser.

The country’s telecoms regulator and the Telecommunications Ministry have decided to fine Kuwait’s Zain, Asiacell, which is backed by Qatar’s Qtel, and Kurdish-owned Korek Telecom for failing to provide the quality of services stipulated by their licences.

Korek has also breached a second condition of its licence by failing to provide mobile phone services in all of Iraq’s major cities.

“Asiacell is bad and Zain is very bad,” says Hayam al-Yasiri, an adviser to the Telecommunications Ministry. “Korek is breaching the licence because of the coverage and the service. Korek up to this moment does not cover many cities, although according to the licence they should cover them.”

At a recent meeting with the ministry the Communication and Media Commission (CMC), which regulates the country’s telecoms sector, stated that the three operators had breached their licences and would be fined. “I was in a meeting with the CMC and some ministers where they decided to impose penalties on these companies,” says Al-Yasiri. “The decision may be announced in the next two weeks. They should pay some money.”

The regulator and the ministry have yet to decide how much Zain, Asiacell and Korek will have to pay. The decision to fine the three incumbents comes days after the Telecommunications Ministry said it would auction a fourth mobile phone licence (MEED 21:11:08).

The ministry expects Iraq’s parliament to approve plans for the auction within weeks. US operators Turkcell and Verizon have already submitted their plans to operate the fourth licence.

The three incumbent mobile operators have also yet to pay in full for the licences they were awarded in August 2007. Each of the three agreed to pay $1.25bn for their 15-year licences.

On 24 November, Iraq’s cabinet turned down a request from the three to delay their remaining licence payments by several years. The value of the outstanding licence payments is unclear. Zain, Korek and Qtel on behalf of Asiacell all failed to respond to MEED’s calls at the time of going to press.