MDMS implementation halted after a PM directive, restriction lifted for now

The full implementation of the Mobile Device Management System, MDMS in Nepal has been temporarily canceled following a directive from PM Pushpa Kamal Dahal “Prachanda”. The mobile security system was supposed to launch to its full capacity today on Poush 15, 2079 (December 30, 2022) by Nepal Telecommunication Authority (NTA) but now its application is cast under another shadow.

Now, the telecom regulator will continue its operation with the existing system.

PM’s Press Coordinator Surya Kiran Sharma said that the authority has been instructed to halt implementing the new system and stay with the previous process.

Purushottam Khanal, Chairman of NTA also confirmed that the decision to implement the full version of the MDMS system has been postponed indefinitely.

If the system had gone to its full implementation, people would have had to declare their phones at the customs points at the Tribhuwan International Airport.

Arun Pokharel, head of the Tribhuvan Airport Customs Office confirmed that the new structure of MDMS is not implemented yet.

“We received an instruction yesterday evening not to implement the new MDMS system,” he said, “Sp, we have not issued a declaration letter to anyone which was part of the new provision.”

What people didn’t approve of the full implementation of MDMS in Nepal?

MDMS is being enforced to curb the large grey phone market in Nepal. It also helps people track missing or lost phones. However, the government was preparing to slap customs taxes on phones Nepalese would bring in Nepal as gifts to their family and friends from abroad. The decision was met with wide condemnation lately.

Not just with the customs charges, but people criticized the government that having to register phones upon arrival at the airport would make it inconvenient for passengers.

In response, the disgruntled Nepalese ran the #Noremittance trend in protest against the custom charge on phones.

NTA planned to enforce MDMS from Poush 15 with a new set of stringent measures for mobile phone operation. It was planned to charge custom tax on phones if passengers brought two phones with them. In case someone brought more than two phones, the officials at customs points at airports were to confiscate them. However, the PM’s directive has delayed MDMS till another decision.

Earlier, NTA had urged the people to declare their phones to the customs by the Customs Act, 2064 after taking a declaration letter (Pragyapan Patra) from the Customs Office. The request applied to the handsets (with 15-digit IMEI number) brought by Nepalese from abroad for private use (not registered in the MDMS system or not in use in Nepal before 2079 Bhadra).

Users were also told to register their phones (in use for private purposes) only on the basis of passport, citizenship, and national identity card along with the declaration letter here.

When will MDMS go to its full capacity?

For now, the full launch of MDMS will go under discussion again. The decision not to implement the comprehensive mobile regulation system came into effect after talks between the Finance Minister and the newly elected PM, Dahal.

It’s likely that a new working procedure will be formed to launch MDMS in its full version.

‘PM instructed not to start MDMS in its complete form. He has told me that it should go live only after making other necessary arrangements. The customs department is also directly involved in implementing this decision of NTA.

Mr. Khanal said that there needs to be coordination between the customs department and the authority.

MDMS in Nepal

MDMS short for Mobile Device Management System will help curb the grey phones market in Nepal. It will also help track stone or lost phones and bring every unit under the direct monitoring of the regulator. At the same time, the government will increase its revenues that have slipped due to the lack of such a regulatory system.

The system is implemented to contain the imports, sales, and distribution of unauthorized mobile phones and also to help track lost or stolen handsets inside Nepal. It is likely that phones coming via illegitimate channels will stop accessing telecom services.  

With MDMS, importers and distributors also need to mandatorily get approval from NTA to import phones. Likewise, they could only sell phones that have been registered in the system.     

MDMS refers to a higher-level monitoring system that works for the holistic management and operation of mobile devices such as PCs, tablet PCs, cell phones, POS systems, and other devices. It’s a software application that helps device fleet operators to manage and implement rules or policies on various types of devices.

Find out your mobile phone’s IMEI Number

NTA has urged future phone buyers to first verify if the phone has been registered in the system. The regulator has started a portal to facilitate users to confirm both verify IMEI registration and find out one of their devices.

If you want to find out the IMEI of your phone or want to verify a phone’s registration status, visit here and fill up either field you wish to. If the IMEI you entered is registered, it means your phone is legitimately operating otherwise, your phone may be stripped of telecom services.

But the regulator won’t immediately block or blacklist your phone. You will still receive a short period to register your phone and avoid possible repercussions. Learn more below.

And to make it easy for you, if your phone has been registered already, you will receive a message on your phone with confirmation.

NTA to block unregistered phones after MDMS is implemented

When the full-fledged MDMS launches, NTA will start blocking devices not registered in its system. But NTA has white-listed all the phones operating in Nepal till Bhadra 30. But phones which aren’t registered until Poush 15, 2079 will now be blocked. After it, handsets won’t have telecom services on any network in Nepal.

Grey Phones in Nepal

Grey phones in Nepal are at large. There is an estimated 25-30% of grey phones in the Nepali mobile phone market. The worst is that people are using them without concern. This has not only put mobile phone owners’ safety at risk, but it has also cost the government in revenues. But finally, the Nepal government is gearing up to sort out the issue. After all the talks, discussions, and preparations, NTA has finally got MDMS all ready to execute.

With this, the authorities will be able to monitor all the mobile phones operating in Nepal. NTA would also roll out its policies via updates on phones, and monitor users for anti-social behaviors. Besides, the government will be able to collect revenues when phones are brought via legitimate channels.

Checkout: Mobile Phone imports increased in Nepal despite COVID-19 Pandemic

How Do Grey Phones Enter Nepal?

In Nepal’s context, retailers smuggle phones into the country from India taking advantage of open borders. As they dodge the customs charges, they can sell those phones in the Nepali market for cheaper prices.

Secondly, people working abroad also bring such phones in large volumes every month. Such phones are sold very commonly in major cities in Nepal, especially in border areas and main cities under the nose of authorities. Places, where such phones are bought and sold, are called grey markets.

Nepal imports roughly one million sets of phones monthly. Out of those, 2,50,000 phones remain unauthorized. This has cost the government around NRs. 7 billion every month, sources say.

NTA MDMS in Nepal: To Curb Grey Phones

For now, the beta version of MDMS is in use. The project has seen many delays over the years and got more delays due to COVID-19. This had obstructed the procurement of MDMS systems from Malaysia but finally, NTA has been able to beat the odds and kickstart the system.

The MDMS system will also help identify smuggled phones from legitimately imported ones. It will also help in the retrieval of lost phones if required.

Earlier Mr. Purushottam Khanal, Chairman of Nepal Telecommunication Authority had said, “The government will implement a whitelisting program through MDMS within three months. After fully operational MDMS, every phone will be functional (mobile network wise) only after being registered to NTA.”

Grey phones are sold very commonly and are in use in all parts of the country. “The issue needs to be tackled with a broader approach”, said Mr. Binod Lamichhane, an Inland Revenue Officer at Naya Sadak.

Additionally, the open borders have also remained unfortunately favorable for people to evade customs checkpoints. People cross borders to purchase phones and daily essentials at a lower cost.

What Will MDMS Do to Your Grey Phone?

From now on, MDMS will come with several ramifications on grey phones operating on any network in Nepal.

• First of all, your grey phone will not be operational for telecom services after Poush 15. As a concession, all operational phones with Nepali SIM cards won’t be immediately blocked.
• In case such a phone is lost, one cannot lodge a police report for it. If one does, the chances are they will find themselves in jeopardy for using an unauthorized.
• Your new grey phone will be blocked out of any carrier network in Nepal. It will not be compatible with any telecom network from Nepal in the future.
• Since the unauthorized phone does not receive any signal, its utility will be a bare minimum. You cannot avail yourself of any telecom service and the device becomes almost useless like a brick.

Then again, a grey phone evades government registration, taxes, and regulation. The black marketeer or the smugglers sneak into the country via illegal routers and circulate such phones at large. The public buys them because they come cheap without realizing the broader risk entails. Eventually, it also raises a moral question, of whether one should use an illegal phone at all.

About MDMS in Nepal

MDMS stands for Mobile Device Management System. The advanced system helps to keep track of every mobile phone operational in Nepal, along with its locations. When this system comes into effect, authorities will be able to track down unauthorized devices and render them unusable on any mobile network within the country.

MDMS has been in the news for a long time. It has been in the plan of the Nepal Telecommunication Authority (NTA) for years. Though the Centralized database of all phones was conceived long back, the MDMS was coined with an NTA project in 2018. But the outcome never came to fruition. The mobile importers in Nepal have also voiced their concern about its effects on business. As a result, all the stakeholders were standing on the same page.

How to register your phone at MDMS

To register your phone in MDMS, follow the steps below:

Step 1: First, visit the link here.

Step 2: Now, you see fields requiring you to submit some details. Enter your phone’s IMEI number, the brand of the phone, and the model, and also confirm whether the phone is currently in use or not. After entering the details, click on Validate IME and Continue.

Step 3: In the next step, you need to enter when and where you entered Nepal and also need to provide your personal details. This also includes your passport number and your nationality. Then, you need to fill in a different set of details depending on your nationality.

Nepali: If you select Nepali as your nationality, you need to enter your address and whether the phone you have is registered for your personal use or for others. If you brought your phone as a gift for others, the option is for you. Select between ‘Self’ and ‘Others.’

Foreign: In case you are not Nepali by nationality, you need to provide your address in your home country and submit your visa validity date. If you wish to extend your Visa, then you must renew your phone’s IMEI validity with the same process.

Step 4: Now, you need to recheck your details. Make sure the details are accurate before you submit them. You will need to upload and submit a scanned copy of your passport, and an entry stamp from the immigration department. It also requires you to submit proof of purchase of your smartphone to prove that it’s not a grey phone. (The scanned file should be in .jpg or .jpeg format and should not exceed 512 KB in size).

NTA’s system runs a check on the details and decides whether to approve your registration or not.

Benefits of Implementing MDMS In Nepal

For now, the government registers the IMEI of mobile phones through the NTA portal. But this practice also needs to improve as it has not been proportionate to address mobile phone-related issues.

With the introduction of MDMS however, it now keeps a record of every phone. This will help to keep accurate data on mobile phones that enter the country via legal routes. In the case of stolen devices, the owner can request to block the device directly. At the moment, owners have to go through the hassles of first writing an application to the police, and inquiring at the NTA to locate their phones.

Read the detailed process for how to report and track lost/stolen phones online?

MDMS On Telcos’ Servers

But with MDMS working, it will be integrated into NTC, Ncell, and Smart Cell servers. So that every phone will access the mobile network after the verification of the mobile in the central MDMS database at NTA. This will also help phone owners when their phones are stolen. For example, if someone lodges a complaint about their phone’s theft to the telco, the company will have the capacity to restrict any service when another SIM is detected on the stolen phone.

Likewise, the Centralized EIR system will be beneficial for all; the government, traders, and mobile phone users. It will curb the circulation of unauthorized phones in Nepal and contain the grey phone market. The government will raise more revenues at customs and the owners will be able to assure themselves of their devices’ legality.

What do you think of the MDMS launch in Nepal? What is your opinion of customs charges on phones brought from abroad? Do leave your perspective in the comments below.