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TUSSLE BETWEEN DOT AND TRAI; COURTESY OF THE DRAFT TELECOMMUNICATION BILL 2022
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TUSSLE BETWEEN DOT AND TRAI; COURTESY
OF THE DRAFT TELECOMMUNICATION BILL 2022
AUTHORED BY - ANURAG KRISHNA
TIWARI
INTRODUCTION
The Draft Telecommunication Bill
2022, is one of the most recent bills to be presented before the legislature of
the country. It was released by the Ministry of Communication for public
comment. The bill has tried to update the existing regulatory framework while
making provisions to tackle the challenges in the telecommunication sector due
to its increasing vastness and the advent of new technologies. The bill
consolidates the Indian Telegraph Act of 1885, the Indian Wireless Telegraph
Act of 1933, and the Telegraph Wires (unlawful possession) Act of 1950. The new
bill repeals these acts and attempts to restructure the legal and regulatory
framework for the telecom sector. Carriage and content are the two most
important terms to reach the gist of the issues of the bill. Carriage is like
the highway that allows us to go from one place to another. In the context of
telecom, it is the telecommunication network that carries bytes from one on the
system to another whereas content is what rides on the carriage. Whatsapp,
Netflix, etc. create content and bring it to you via carriage that is network
providers. The developer needs not to seek permission from the network
providers or the government. However, in the draft telecom bill 2022, the
government discussing digital India is putting a hurdle in its path. The bill
is giving exclusive services of providing telecom services. Any service made
available via the Internet is under the center’s purview. The government
justifies this licensing on the grounds of national security. A licensed
telecom service provider will have to compulsorily provide a network to law
enforcement agencies so that they can intercept messages during the investigation.
However, if the lawful interception is the issue, Sec 69 of the IT act already
provides that central or state government may issue directions to do so to
preserve, among other things, national security and public order. Due to these issues,
ambiguity remains behind the intention of the government.
CONCERNS OVER LICENSING
The licensing framework has been a
crucial part of India’s telecommunication law. Section 4 of the Indian
Telegraph Act, of 1885 gives the government the power to grant a license to any
person for establishing, maintaining, or using a telegraph. Before DOT came
into existence in 1985, telecommunication services were solely provided by the
Indian Post and telecommunication department. In November 2003 the government
introduced the unified access service license (UASL) regime. This gave service
providers access to fixed and/or mobile services under the same license. There
were efforts by the government in 2012 to simplify licensing framework by
introducing the National Telecom Policy, 2012 which aimed towards the creation
of One Nation- One License. This regime was implemented through two phases, the
first phase, the UL regime was brought into the arena in 2013, and in the
second phase, there was a delinking of licensing for networks from delivery of
service and a new category called Unified License (virtual network operator)
came into existence in 2016. [1]
In 2013, a uniform licensing scheme
was established. The spectrum allocation was separated from the license and
must now be acquired through a competitive bidding process by the rules. For
all telecom services offered in the nation, a single Unified License is needed.
The service provider may choose the services to be provided, known as Service
Authorizations.
In 2016, India approved the use of
virtual network operators (VNOs). VNOs are considered extensions of network
service operators (NSOs), who do not own the underlying core network(s); as a
result, VNOs are not permitted to install equipment linking with the network of
other NSOs. The VNOs are not given any spectrum. Access Services allows
parenting with a single NSO. Any telecom services offered by the current
telecom service providers may be offered by VNOs. A regime analogous to UL is
UL (VNO). It provides all authorizations as listed in the UL.
The notion of an independent network
service provider or operator, who will set up the network and offer the
services to the service delivery operator on a wholesale basis for retailing
purposes, is present when the network layer and service layer are unbundled.
Such freestanding network operators, who will only offer network layer services
on a non-discriminatory basis, might have some incentive built in to encourage
such a regime.
One theory is that if the network
service layer and service delivery layer are separated by introducing a
specific license for the network layer alone, the network layer operator would
willingly share its network with service delivery operators, resulting in cost
savings and increased utilization of resources, including spectrum. According
to research into worldwide norms, network operators are also permitted to offer
services to end users either under the same license or by obtaining a separate
service delivery license. The question of whether the network operator can
provide services to end users emerges. To provide mobile services, a network
operator must purchase spectrum at a price set by the market and adhere to
minimum roll-out requirements. It may not have control over the
commercialization of network and spectrum resources if it is not permitted to
provide services to end users directly. Additionally, there may be ineffective
spectrum use as a result of this. The investment may not be fully exploited in
the absence of SDOs/VNOs throughout the network, making Return on Investment
(RoI) more difficult to achieve. If a network operator is permitted to offer
services on their own, just separating the license from the network owner may
not get the intended effects since they are not permitted to collaborate with other
service delivery operators. There appears to be a need for a framework to be
imposed on network operators to provide wholesale services to service delivery
providers to make the unbundling effective.
The telecom regulatory authority of
India and the government had concerns over the rejection of recommendations of
TRAI for creating a separate category of license to provide network services on
a wholesale basis. In TRAI’s recommendation, a separate license for access
network providers (ANPs) would help in bringing more investments and would also
strengthen the service delivery segment. As the deployment of 5G technology is
already at the door, this would help in making it more economically viable.
Through a consultation paper in 2021, “Enabling unbundling of different layers
through differential licensing”, TRAI recommended the creation of ANPs. [2]
The recommendations of TRAI were not
accepted by DOT claiming that there may not be adequate demand for separate
ANPs in the market which would fail its purpose. But the same was again opposed
by TRAI as DOT did not give any reasonable justification with supporting shreds
of evidence for the same which made DOT’s claim weak.
According to the regulator, if a
distinct category of ANP is established, the network provider might construct a
core network, radio access network (RAN), and collaborate with virtual network
operators to offer services. "It may provide a situation where everyone
benefits, allowing the VNO licensee to sustain the regime by financing RAN.
Accordingly, the regulator stated that the implementation of separate licenses
for access network providers might draw in investment and boost the service
delivery sector.
According to Trai's plan, the ANP
licensee would create and manage a telecom network, including wireless and
wireline, and buy spectrum through auctions. However, the ANP licensee won't be
able to provide services directly to retail consumers; instead, they'll have to
share the network infrastructure for service delivery on a wholesale basis with
other parties, such as telecom operators or VNOs. "The authority is of the
view that the development of a distinct network-only layer (in the form of an
ANP license) might lead to improved network resource sharing, cost reduction,
and higher investment in the sector. Additionally, it may serve as a localized
accelerator for the spread of 5G services for business customers, industrial
users, etc.”, Trai stated.[3]
THE NEW POSITION OF TRAI
As an impartial and specialist
regulator for the telecom industry, the TRAI was founded in 1997. Given that
the government plays a significant role in the telecom sector through a variety
of functions, including the provision of services, licensing, and spectrum
allocation, it was deemed necessary to establish a regulator independent of the
government to ensure fairness for private TSPs, level playing fields, and the
protection of consumer interests. However, following the draft Bill's
release on September 21, the proposed rules regarding OTT communication services,
ministry partnerships, and the definition of "telecommunications"
have drawn much attention and criticism.[4]
The current draft telecommunication
bill 2022, however, significantly weakens TRAI's standing in several
ways, changing its role from one of regulation to one of recommendation. First,
before awarding licenses, the government would no longer be compelled to get
recommendations from the TRAI. Additionally, it takes away the TRAI's ability
to request from the government any information or papers required to make such
recommendations. Additionally, as opposed to before, the Department of
Telecommunications (DoT) will no longer be obligated to refer back to TRAI for
reconsideration of any suggestions that it disagrees with. The elimination of
such authority would be inconsistent with international practice, which gives
telecom authorities more autonomy to maintain investor trust and consumer
safety in the market. [5]The
Draft imposes no obligation on the Central Government to issue reasoned orders
or seek judicial approval before taking any action, no matter how far-reaching.
The Central Government has been given the authority to issue intercepting and
monitoring orders in the event of a breach of terms and conditions, without the
need for legislative approval. In the absence of transparency and
accountability, arbitrary powers can flourish. Restricting the Telecom
Regulatory Authority of India's (TRAI) powers to recommend institutions to the
Government for spectrum assignment is just one of the many ways the Draft
encourages the centralization of power in the hands of the Central Government.
The absence of a robust system to hold the Central Government accountable for
its actions is a clear gap that the Draft not only fails to address but also
advances in.[6]
TRAI cannot currently impose
sanctions on telecom corporations and has no authority to execute its orders.
According to the TRAI Act, the recommendations of TRAI were not required, but
the government was required to seek their advice regarding the necessity, timeliness,
and terms of the licensing of a service provider. Additionally, TRAI had the
authority to ask the government for the records and data it needed to make
these recommendations. By depriving TRAI of any recommendatory powers, the Bill
weakens TRAI's position as an independent regulatory agency rather than
enhancing it. [7]The
proposed Indian Telecommunications Bill 2022, according to the Broadband India
Forum (BIF), has to be critically and fairly reviewed because it attempts to
remove the legal independence of the (TRAI) and turn it into the
government's puppet. The industry group asserted that the current regulations
cover regulatory safeguards, maker and checker balance, and other elements that
have helped bring the industry to where it is now.[8]
However, Section 46 of the Draft Bill
2022 repeals requirements that the DoT consult with TRAI before making certain
decisions. By doing this, the Central Government gains the authority to decide
on licensing without consulting TRAI, effectively nullifying that regulatory
body's power of recommendation. The Draft Bill, 2022 also suggests that if the
DoT disagrees with suggestions made by TRAI, it may not send them back for
reconsideration. In addition, it is suggested that DoT may elect not to submit
any information or documents requested by TRAI for TRAI to provide its
recommendations. Section 11 of the TRAI Act highlights four primary categories
of TRAI functions: recommendatory functions, regulatory functions, tariff fixing,
and other functions as prescribed by the Central Government. Furthermore,
Section 11(2) of the TRAI Act entrusts TRAI with the responsibility of
determining tariffs to be levied by establishing the rates at which telecom
services will be provided within India as well as abroad, including the rates
at which messages shall be transmitted to any country outside India. In section
11(2) of the TRAI Act, the Draft Bill, 2022 also suggests changing the words
"Notwithstanding anything contained in the Telegraph Act" to "in
consonance with the Indian Telecommunication Act, 2022." The current legal
framework gives TRAI complete authority to set telecommunications pricing. The
word "Notwithstanding" at the beginning of section 11 of the TRAI Act
gives TRAI the exclusive authority to make decisions about tariffs, prohibiting
the DoT from interfering with those decisions. This overriding impact will be
eliminated by the Draft Bill 2022, essentially stripping TRAI of its authority.
WAY AHEAD
The Draft Bill, 2022 proposes to
significantly limit TRAI's existing powers and functions. Diluting TRAI's
existing powers will render it irrelevant and toothless, potentially disrupting
the sector's equilibrium. In formulating regulations, an independent and
autonomous regulator brings predictability and certainty, and these decisions
are based on economic principles rather than political expediency. A strong
regulator must be in place in addition to cleaning up and organizing a disorganized
legislative landscape into a clear and understandable framework, which is
unquestionably the need of the hour. It is possible to repeal outdated,
antiquated laws and create a unified regulatory framework for the telecom
industry without further weakening or reducing the authority of the TRAI. When
imagining an effective regulator, it is helpful to understand which powers
should be delegated to the government and which to the regulatory body.
However, policymaking can be tainted by political bias because the beliefs of the
ruling regime inevitably seep into policy language and ethos. A strong
regulatory body is a solution. A body that is not subject to political whims or
pressures, but rather makes telecommunications-related decisions based on hard
facts, economic metrics, and empirical data. If we want the Indian
telecommunications sector to encourage healthy and free competition, we need a
strong regulator with independent power over sector entities.
In light of the aforesaid, we propose that, for the benefit of
India's overall telecom infrastructure, TRAI should continue to function as an
efficient and effective regulator. The Indian Telecommunications Act, 2022 must
be a law that enhances TRAI as a regulator, not one that lessens its current
function, and the legislature must bear this objective in mind as it
consolidates the updated legal framework for the Indian telecom sector. We
believe that doing this will keep things in balance and benefit the country.[9]
[1] ‘Consultation
Paper on Enabling Unbundling of Different Layers through Differential
Licensing’ (Telecom Regulatory Authority of India20 August 2020)
<https://www.trai.gov.in/consultation-paper-enabling-unbundling-different-layers-through-differential-licensing>
accessed 15 May 2023
? [2] Archit Tandon, “TRAI, DoT Tussle over Licence to Access Network
Providers” (Communications Today, September 7, 2022)
<https://www.communicationstoday.co.in/trai-dot-tussle-over-licence-to-access-network-providers/#:~:text=TRAI%2C%20DoT%20tussle%20over%20licence%20to%20access%20network,without%20giving%20any%20rationale%20to%20support%20the%20decision>
accessed January 6, 2023
[3] PTI, “Trai, DoT Tussle over Licence to Access Network
Providers” Economic Times (September 6, 2022)
<https://economictimes.indiatimes.com/industry/telecom/telecom-news/dots-rejection-of-recommendations-on-differential-licence-without-any-rationale-trai/articleshow/94035376.cms>
accessed January 6, 2023
[4] Chatterjee
A, ‘Modi Govt Again Extends Feedback Deadline for Telecom Bill, List of
Concerns Grow’ (ThePrint11 November 2022)
<https://theprint.in/tech/deadline-for-feedback-on-telecom-bill-ends-now-modi-govt-has-to-address-these-key-concerns/1209062/>
accessed 30 December 2022
[5] Goyal
T, ‘Explained | the Draft Telecommunication Bill, 2022’ (Thehindu.com29
September 2022)
<https://www.thehindu.com/business/Industry/explained-the-draft-telecommunication-bill-2022/article65952169.ece>
accessed 30 December 2022
[6] Dhawan A, ‘The Paranoid
Panopticon: Draft Indian Telecommunication Bill’ (Livelaw.in27 October
2022)
<https://www.livelaw.in/columns/department-of-telecommunication-draft-indian-telecommunication-bill-telecom-regulatory-authority-of-india-trai-212576?infinitescroll=1>
accessed 30 December 2022
[7] K.K.
Prahalad, ‘There Are Valid Concerns over the Draft Indian Telecommunication
Bill, 2022 – the Leaflet’ (The Leaflet – An independent platform for
cutting-edge, progressive, legal, and political opinion.13 October 2022)
<https://theleaflet.in/there-are-valid-concerns-over-the-draft-indian-telecommunication-bill-2022/>
accessed 30 December 2022
[8] ‘Draft Telecom Bill
Will Curtail TRAI’s Power, Needs Critical Review: BIF’ (Moneylife NEWS &
VIEWS2022)
<https://www.moneylife.in/article/draft-telecom-bill-will-curtail-trais-power-needs-critical-review-bif/68438.html>
accessed 30 December 2022
[9] Abbas
A, ‘Telecom Regulatory Authority of India: The Present, the Proposed, the
Future’ (Mondaq.com23 November 2022)
<https://www.mondaq.com/india/telecoms-mobile--cable-communications/1253450/telecom-regulatory-authority-of-india-the-present-the-proposed-the-future>
accessed 5 January 2023
Article Information
TUSSLE BETWEEN DOT AND TRAI; COURTESY OF THE DRAFT TELECOMMUNICATION BILL 2022
Authors: ANURAG KRISHNA TIWARI
- Journal IJLRA
- ISSN 2582-6433
- Published 2023/06/05
- Volume 2
- Issue 7
About Journal
International Journal for Legal Research and Analysis
- Abbreviation IJLRA
- ISSN 2582-6433
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