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Press Release
Singed a Business Cooperation Contract with Vietnam?s second telecom operator SPT
To deliver nationwide CDMA service for 15 years to come starting latter half of 2001
International debut of Korean CDMA mobile service
A strong foothold in the Southeast Asian market
Korea?s CDMA mobile service makes its debut in the international market.
SK Telecom, LG Electronics and DongA Elecom will jointly enter the Vietnamese CDMA mobile market under a Business Corporation Contract (BCC) with Saigon Post & Telecommunication Services Corporation (SPT), the second mobile operator of Vietnam, through SLD Telecom the three companies founded jointly in Singapore last April.
The companies said that SLD Telecom and SPT had signed the contract under which they jointly enter Vietnam?s CDMA mobile service market on October 10 at a signing ceremony held in Hochimin City, Vietnam, with Jung Nam Cho, Presidnet of SK Telecom, Pyong Won Seo, President of LG Electronics, Gunn Soo Lee, Chairman of DongA Elecom, and Ngo Hoang Mihn, Chairman of SPT attending.
Under the agreement, SLD Telecom will provide cash investment and CDMA technology and knowhow, and SPT will share with SLD Telecom its license to offer nationwide CDMA mobile telecom service and the 2Mhz two-way frequency bandwidths in the 800 Mhz spectrums. The two companies will deliver nationwide CDMA mobile service for 15-years to come.
SLD Telecom and SPT will inaugurate the commercial service in the latter half of next year. SK Telecom will be responsible for operating CDMA mobile phone service, and LG Electronics will supply the system and terminal equipment.
SLD Telecom is a joint company of which 53.8% is owned by SK Telecom, 44% by LG Electronics, and 2.2% by DongA Elecom. The three companies invested approximately 200 million dollars in the form of equipment, technology transfer and cash. The three will divide profits from the company?s 15-year operation.
SK Telecom, LG Electronics and DongA Elecom intend to convert the BCC into a joint venture once the Vietnamese telecom market is deregulated, and expect that the venture will provide them with a strong foothold in the market as a third generation full-range telecom operator and a long-term profit-making base.
BCC (Business Cooperation Contract): A Business Cooperation Contract, or BCC, is a document signed by two or more parties in order to carry out investment activities within Vietnam without establishing a separate joint venture. The Vietnamese law prohibits a foreign entity from investing in a local carrier in the form of a joint venture. Instead, Vietnam allows foreign entities to participate in telecom business under unofficial Business Cooperation contracts. All BCC projects must obtain approval from the country?s telecom authority DGPT and the International Cooperation Department, and by becoming a party to a BCC, foreign investors are allowed to take part in building a telecom network and/or offering telecom services under the condition that they receive a certain percentage of the profits from the business. However, foreign entities are not allowed to own a telecom carrier. The Vietnamese government is limiting BCC-based businesses in telecommunications for reasons of national security and political sensitiveness.
SK Telecom, LG Electronics and DongA Elecom will jointly enter the Vietnamese CDMA mobile market under a Business Corporation Contract (BCC) with Saigon Post & Telecommunication Services Corporation (SPT), the second mobile operator of Vietnam, through SLD Telecom the three companies founded jointly in Singapore last April.
The companies said that SLD Telecom and SPT had signed the contract under which they jointly enter Vietnam?s CDMA mobile service market on October 10 at a signing ceremony held in Hochimin City, Vietnam, with Jung Nam Cho, Presidnet of SK Telecom, Pyong Won Seo, President of LG Electronics, Gunn Soo Lee, Chairman of DongA Elecom, and Ngo Hoang Mihn, Chairman of SPT attending.
Under the agreement, SLD Telecom will provide cash investment and CDMA technology and knowhow, and SPT will share with SLD Telecom its license to offer nationwide CDMA mobile telecom service and the 2Mhz two-way frequency bandwidths in the 800 Mhz spectrums. The two companies will deliver nationwide CDMA mobile service for 15-years to come.
SLD Telecom and SPT will inaugurate the commercial service in the latter half of next year. SK Telecom will be responsible for operating CDMA mobile phone service, and LG Electronics will supply the system and terminal equipment.
SLD Telecom is a joint company of which 53.8% is owned by SK Telecom, 44% by LG Electronics, and 2.2% by DongA Elecom. The three companies invested approximately 200 million dollars in the form of equipment, technology transfer and cash. The three will divide profits from the company?s 15-year operation.
SK Telecom, LG Electronics and DongA Elecom intend to convert the BCC into a joint venture once the Vietnamese telecom market is deregulated, and expect that the venture will provide them with a strong foothold in the market as a third generation full-range telecom operator and a long-term profit-making base.
BCC (Business Cooperation Contract): A Business Cooperation Contract, or BCC, is a document signed by two or more parties in order to carry out investment activities within Vietnam without establishing a separate joint venture. The Vietnamese law prohibits a foreign entity from investing in a local carrier in the form of a joint venture. Instead, Vietnam allows foreign entities to participate in telecom business under unofficial Business Cooperation contracts. All BCC projects must obtain approval from the country?s telecom authority DGPT and the International Cooperation Department, and by becoming a party to a BCC, foreign investors are allowed to take part in building a telecom network and/or offering telecom services under the condition that they receive a certain percentage of the profits from the business. However, foreign entities are not allowed to own a telecom carrier. The Vietnamese government is limiting BCC-based businesses in telecommunications for reasons of national security and political sensitiveness.