Telecoms operator C3 facing sanctions over $500,000 in disputed fees

A longstanding dispute over the payment of licensing fees between local telecommunications operator C3 and regulator OfReg is heading for the courts.

C3, also known as Infinity Broadband Ltd and OfReg have been engaged in a back and forth for more than a year over outstanding fees amounting to hundreds of thousands of dollars.

The regulator claims it is owed more than $500,000 in licensing fees, according to a press release issued Monday. It has also indicated plans to fine C3 for its non-payment of those fees.

The telecoms company disputes OfReg’s authority to impose those charges, however, and plans to challenge the decision in court.

OfReg, in the release, pointed out that after the issuance of a final enforcement notice to C3 over the fees and reports, the telecom operator “has now initiated a legal challenge to OfReg’s determination through the courts”.

Randy Merren, C3 managing director, declined comment when contacted by the Cayman Compass on Monday. Premier Wayne Panton is also an owner of C3.

Licence fees, the regulator stated, are collected from all information and communications technology licensees and comprise two parts – a ‘royalty fee’ that OfReg collects on behalf of the Cayman Islands government and is reflected as government revenue; and a ‘regulatory fee’, which it said covers OfReg’s costs of regulating the ICT sector.

OfReg, in the release, said C3 “repeatedly failed to comply” with its longstanding licence obligations, resulting in the issuance of an enforcement notice which listed  failure to pay its licence fees as well as failure to submit its audited financial reports.

A link to the enforcement notice, with heavily redacted pages, was also issued along with the press release.

Additionally, OfReg said it had “issued C3 with a notice outlining the demands for payment of outstanding fees, including any interest accrued, and the proposed imposition of fines for the various breaches”.

The regulator said in July 2022, after several reminders and requests were sent to C3, it issued an initial enforcement notice setting out C3’s failure to pay its licence fees totalling over $500,000, including interest.

At that time, C3 had also failed to submit its required audited financials for 2021, OfReg added.

“C3 issued a response challenging OfReg’s authority to collect licence fees as per the obligation set out in C3’s own ICT licence and demanded that OfReg pay back fees already paid by C3 for previous periods,” the statement said.

Following this challenge, OfReg said it still continued with its enforcement action and issued a final determination in late August 2023.

“The determination confirmed OfReg’s position that C3 was, and remains, obligated to pay its licence fees and submit its financial reports and as such C3’s failures amounted to a breach of its licence. As a consequence, OfReg issued C3 with a further notice on intended fines for the breaches beyond any demand to pay the outstanding fees,” it said.

Prior to OfReg issuing the enforcement notice in July 2023, the regulator said, C3 submitted its outstanding audited financial reports.

“C3 has also not paid licence fees beyond the amount referenced in the enforcement notices for the period from July 2022 to present,” it added.