MPTC Reviews the Universal Service Fund Framework

In 2025 the Cambodian authorities announced a reform of the universal service fund arrangements. The reform seeks to update the objectives, governance, contribution and disbursement mechanisms of the fund to reflect the current state of the telecommunications market, the priorities of national digital development and the lessons drawn from past initiatives supported by the fund.

The reform is relevant to all licensed telecommunications operators, which typically contribute to the fund, and to potential recipients of fund-supported projects, including operators serving remote areas, providers of specialised services, community organisations and initiatives targeting digital inclusion.

Universal service arrangements were originally designed at a time when access to basic voice services was the primary objective. As mobile and broadband coverage have expanded, the definition of universal service has broadened to include quality connectivity, digital literacy, accessibility for persons with disabilities and the availability of key digital services. The reform updates the framework to align with these evolving priorities.

The reform also responds to observations about the efficiency and effectiveness of fund operations, including the timeliness of disbursements, the transparency of project selection and the measurement of impact. A more agile and accountable fund is expected to deliver better outcomes for the contributors and for the intended beneficiaries.

The reformed objectives combine coverage in under-served areas, quality of service in areas that are formally covered but where quality remains inadequate, accessibility for persons with disabilities, digital inclusion of vulnerable groups and specific national digital initiatives that benefit from targeted support. Projects supported by the fund are expected to demonstrate alignment with one or more of these objectives.

The objectives are intended to be adaptive, allowing the fund to respond to emerging needs without requiring frequent formal changes. Governance arrangements support this adaptability while providing appropriate oversight.

The reform strengthens the governance of the fund, including the arrangements for strategic direction, project approval and evaluation. A governance body with representation from relevant authorities and, where appropriate, from stakeholders provides direction, while operational management is expected to focus on efficient and transparent implementation.

Reporting to contributors, to the wider industry and to the public supports accountability. Regular publication of information about contributions received, projects supported and outcomes achieved is a key element of the reformed framework.

The reform reviews the mechanism through which operators contribute to the fund. Considerations include the base on which contributions are calculated, the rate of contribution, arrangements for verifying contributions and mechanisms for addressing disputes. The reform aims for a mechanism that is predictable, proportionate to operator activity and consistent with international good practice.

Operators are expected to comply with the contribution mechanism as part of their broader regulatory obligations. Coordination between the fund and the regulator supports efficient administration and reduces the burden on operators.

Projects supported by the fund are selected through mechanisms that favour transparency, competition and impact. Competitive procedures may be used to select operators to deliver coverage in specific areas or to provide specific services, while direct arrangements may be used for cross-cutting initiatives such as national awareness campaigns or accessibility programmes.

Disbursement arrangements are expected to be timely and predictable, allowing selected projects to proceed without unnecessary delay. Performance milestones and evaluation criteria linked to disbursement support accountability and outcomes.

Universal service initiatives operate alongside other efforts to extend connectivity and digital inclusion, including infrastructure programmes, national broadband planning, sectoral digital strategies and international cooperation. The reform emphasises coordination so that fund resources are deployed where they add most value, complementing rather than duplicating other initiatives.

Coordination with private investment is particularly important. Fund support should aim to enable investment that would not otherwise be commercially viable, rather than to displace investment that would occur on commercial terms.

The reformed framework places significant emphasis on the measurement of outcomes. Projects are expected to define clear objectives, to identify indicators of success and to report on progress and results. Independent evaluation of significant projects supports learning and accountability.

Aggregate reporting on the impact of the fund contributes to informed policy discussions, to continuing improvement of the framework and to public confidence in the use of resources contributed by operators.

For operators, the reform confirms the ongoing role of universal service contributions and provides clearer opportunities to participate in supported projects. Operators with strong capabilities in extending coverage, in delivering quality services in challenging environments or in supporting digital inclusion can position themselves as effective delivery partners.

For community organisations, civil-society bodies and other potential partners, the reform offers new opportunities to contribute to national digital objectives, subject to the applicable governance and delivery requirements.

For operators, the reform calls for internal review of the mechanisms for calculating and remitting contributions, of the pipeline of potential fund-supported projects and of the internal capabilities required to participate effectively. Engagement with the reformed governance arrangements supports both compliance and opportunity.

For other stakeholders, the reform offers a framework within which to align proposals for supported projects with the strategic objectives of the fund and with the operational expectations of the governance body.

Lex Civora advises operators, community organisations and other stakeholders on the interpretation and application of the universal service fund reforms, on the design of proposals for supported projects and on engagement with the governance and operational arrangements of the reformed fund.