evaluations on timely basis in order to reduce the risk for an initially positive intervention to start stifling the market development. The Government recognises that its procurement of ICT services, products and solutions has a potential to affect the operation of the private sector, especially having regard to the scale of such procurement. In this context, the Government expresses its commitment to act in this role as any other reasonable and prudent large buyer of respective goods or services, seeking to maximise the long-term value for its money. It believes that such best practice modes of procurement as competitive tendering are the best tools to achieve such objectives. In any case, the Government will avoid arbitrary assignment or distribution of its procurement to specific market players. Where appropriate and subject to other provisions of this Policy, the Government will also evaluate a potential of “build” versus “buy” options, similarly to any other rational user of similar services or buyer of goods. The Government is mindful, however, that it should seek to conduct its procurement in a way that would avoid disrupt changes in market conditions (such as resulting from a change of a supplier of services that constitute a significant proportion of the market). Therefore it will investigate options to reduce an impact of its tendering on the market, while still supporting and benefiting from the market-force-driven operation of the sector. The Government recognises that fair competition may, in certain cases, be negatively impacted by “cream skimming”53. It considers, however, that direct or indirect barriers for market entry or expansion would be a counterproductive way to address such abuses, as they would enable complacency by existing market players. Negative effects of such practices could be addressed by such policy and regulatory instruments as coverage obligations, in particular associated with radio spectrum assignments, and an appropriate Universal Access Policy (UAP), especially the one formulated along the “pay or play” principles (i.e., requiring every licensee to participate in the delivery of services to less economically attractive users either by investing in the provision of such services or paying money into the fund subsidizing such provision). The Government acknowledges a potential, but also challenges presented by internationalisation (and especially regionalisation) of ICT markets in enhancing economies of scale. Many developing regions have been facing such trends. The Pacific currently seems to be somewhat lagging behind in this process, but the potential that such developments represent, especially for private sector players, makes it likely that it will start catching up. Internationalisation (in particular regionalisation) of ICT markets has a potential to bring access to international expertise, new technologies, innovative services and lower costs. Economies of scale, brought by this process, have a potential of enabling stronger and more resourceful regional competitors and enhancing competitive landscape by making national multiple-player markets more viable. The Government, however, also recognises potential challenges presented by regionalisation and internationalisation of ICT markets, especially to national policy makers and regulators constrained by the boundaries of their jurisdictions. Local private sector players may also face challenges, if they do not find effective 53 “Cream skimming” is a practice of serving only high-value low-cost customers, and avoiding investments needed to serve less profitable ones. 44 National Information and Communication Technology Policy

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