Vodafone-Idea parent makes $200 mn advance payment amid coronavirus crisis

India’s telecoms operators became liable for licence fees, penalties and interest dating back over 14 years
Vodafone Plc on Wednesday announced that it was making an advance payment of $200 million to its India arm -- Vodafone Idea, mainly to tide over any liquidity crisis arising out of the Covid-19 pandemic.

The UK-based group has accelerated a payment of $200 million to Vodafone Idea, which was due in September 2020 under the terms of the contingent liability mechanism with Vodafone Idea.

“Vodafone Group has accelerated this payment to provide Vodafone Idea with liquidity to manage its operations, and to support the approximately 300 million Indian citizens who are Vodafone Idea customers, as well as the thousands of Vodafone Idea employees during this phase of emergency health measures,” the group said in press statement on its website.

The company said that following the decision by India’s Supreme Court on the definition of Adjusted Gross Revenue (AGR) in October 2019, India’s telecoms operators became liable for licence fees, penalties and interest dating back over 14 years.

Vodafone Idea has made payments to the Government of India in relation to its AGR liabilities. Under the terms of the CLM, Vodafone Group is obliged to make payments to Vodafone Idea where amounts paid pursuant to the contingent liabilities of Vodafone India exceed those of Idea Cellular.  The CLM took effect at completion of the merger of Vodafone India and Idea Cellular in August 2018.


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