Page 143 - China Mobile Limited - Annual Report 2012

China Mobile Limited
Annual Report 2012
137
Notes to the Financial Statements
(Expressed in Renminbi unless otherwise indicated)
37 Related Party Transactions (Continued)
(a) Transactions with CMCC Group (Continued)
Notes:
(i) The amounts represent telecommunications services settlement received/receivable from or paid/payable to CMCC Group for the
telecommunications project planning, design and construction services, telecommunications line and pipeline construction services,
telecommunications line maintenance services and installation, and maintenance services in respect of transmission towers.
(ii) The amount represents the rental and property management fees paid/payable to CMCC Group in respect of business premises and
offices, retail outlets and warehouses.
(iii) The amount represents the interest paid/payable to China Mobile Hong Kong (BVI) Limited, the Company’s immediate holding company,
in respect of the balance of purchase consideration for acquisitions of subsidiaries.
(iv) The amounts represent settlement received/receivable from or paid/payable to China TieTong Telecommunications Corporation, a wholly-
owned subsidiary of CMCC, in respect of interconnection settlement and network assets leasing revenue and charges.
(v) The amount represents the leasing fees paid/payable to CMCC Group in respect of the leasing of TD-SCDMA network capacity. On 29
December 2008, the Company entered into a network capacity leasing agreement (the “Network Capacity Leasing Agreement”) with
CMCC for the provision of TD-SCDMA related services. The lease was effective from 1 January 2009 to 31 December 2009 and is
automatically renewed for successive one-year periods unless otherwise notified by one party to the other party. The Group is permitted
to terminate the lease by giving 60 days advance written notice to CMCC. No penalty will be imposed in the event of a lease termination.
Pursuant to the Network Capacity Leasing Agreement, the Group leases TD-SCDMA network capacity from CMCC and pays leasing fees
to CMCC. The leasing fees are determined on a basis that reflects the actual usage of CMCC’s TD-SCDMA network capacity and
compensates CMCC for the costs of such network capacity. At the end of the lease term, there is no purchase option granted to the
Group to purchase the network assets. The Group also does not bear any gains or losses in the fluctuation in the fair value of the leased
network assets at the end of the lease term. The Group accounts for the TD-SCDMA network capacity lease as an operating lease.
(vi) The amounts represent the services fee received/receivable from or paid/payable to CMCC Group for providing customer development
services and cooperation in the provision of basic and value added telecommunications services.