Latest news with #TraiAct
Mint
6 days ago
- Business
- Mint
Trai wants more enforcement teeth to rein in telcos, may ask govt to amend rules
The Telecom Regulatory Authority of India (Trai), set up in 1997 to regulate telecom services, tariffs and promote fair competition, wants stringent financial punitive powers to ensure that companies under its oversight strictly play by the rules. According to three government officials aware of the matter, the telecom regulator is working on a plan to get the decades-old Trai Act, 1997 amended and give itself more teeth. To be sure, Trai has sufficient powers to regulate telecom service quality, resolve disputes via TDSAT, and protect consumer interests, but lacks adequate enforcement powers. 'Trai cannot impose strong penalties, attach bank accounts or properties in case of violation, and ask for bank guarantees," the first of three officials cited earlier said, all of whom spoke on the condition of anonymity. This official said that the gaps in the Trai Act make it difficult for the regulator to effectively enforce rules and ensure compliance in the telecom sector. The officials A key demand from the regulator is to have the powers to seek bank guarantees from telecom operators. The bank guarantee will bring seriousness in compliance from telecom operators and can be invoked in case they fail to pay penalties imposed by the regulator, the first official said. Also Read: Tata Communications renews private 5G push In fact, the issue of giving more powers to Trai also came up at a recent meeting of Trai officials with the department-related Parliamentary Standing Committee on Home Affairs, a second official said. This official added that the proposal, which is in the works, will be sent to the department of telecommunications (DoT), under the Union communications ministry. Queries emailed to Trai did not elicit any response till press time. Why Trai can't act tough on telcos As per the Trai Act, 1997, its powers are primarily regulatory, advisory, and enforcement-focused through directions. This is different from other regulators. For example, the markets regulator Securities and Exchange Board of India (Sebi) can pass binding orders independently. However, for Trai, the power to enforce orders is limited. The telecom regulator, for instance, relies on the department of telecommunications for licence actions. One of the key issues is also the enforcement of financial disincentives or penalties, which Trai does not have powers on. 'Trai can enforce a limited penalty but they don't have the power to recover that penalty," said Satya N. Gupta, a former principal advisor at Trai. According to Gupta, the telecom regulator should have the powers to grant licence and implement policy, whereas the government should just make policies. 'In almost every country, the regulator has licensing power. In India, the government has kept both licensing and policy making," Gupta said, adding that Trai has control over a few things such as quality of service orders and tariffs (which is now under forbearance). A key reason for Trai to seek more powers also stems from the financial disincentives worth over ₹140 crore imposed on telecom operators for failing to curb spams, which the operators refused to pay and sought an interim stay in the Telecom Disputes Settlement and Appellate Tribunal (TDSAT). The case is scheduled to be next heard on 8 August. Also Read: Reliance Jio Q1 results: 5G, home broadband milestones boost growth 'It is not illegal for telcos to challenge such orders by Trai but it delays enforcement. Often, operators do not take such orders seriously and also delay compliance with the regulator's request on sharing of certain data for research and investigation," the third official said, adding that Trai can impose some penalties, but not enough to hold companies fully accountable for serious violations. It lacks the teeth to enforce bigger actions — that's the problem, the official added. Call for binding powers, guarantees 'Trai should be empowered to directly issue, amend, or revoke telecom licences, rather than leaving this authority solely with the Department of Telecommunications. This would allow Trai to hold service providers more directly accountable," said Murtuza Kachwala, managing director at business consulting firm Protiviti Member Firm for India. 'Its recommendations—on tariffs, service quality, and consumer protection—should carry more weight by being made binding, rather than just advisory, so operators are obligated to follow them unless a legal challenge overturns them," Kachwala said. According to Kachwala, Trai's enforcement powers should be upgraded so it can independently impose penalties, fines, or other sanctions on operators that violate regulations—similar to the powers Sebi holds in the financial sector. Currently, if telecom operators do not comply with Trai's order on financial disincentives, the best route for Trai to recover the same is through the chief metropolitan magistrate. The Trai Act gives the regulator powers to file a complaint with the magistrate to initiate criminal proceedings if a telecom operator is in violation of Trai's directions or regulations, and fails to comply. However, the process is cumbersome and Trai has not exercised the powers in the last many years, the third official said. In February, the regulator also recommended to DoT that the authorization regime for licence holders such as telecom operators should include a provision for a bank guarantee. This guarantee would cover financial dues and ensure compliance with Trai's regulations, orders, and directions issued from time to time. Also Read: Bharti Airtel slashes pay hikes for employees, including top brass Trai made these comments in its recommendations on the terms and conditions of network authorizations under the Telecommunications. Trai had said that compliance with its orders and regulations is a critical component of the efficient performance of authorized entities (telecom service providers). The DoT, however, has not accepted the recommendations. Bank guarantees are required to secure telcos' payments towards licence fees, performance fees and penalties. When guarantees are invoked, the bank is supposed to pay that much to the institution to which it was provided and the borrower has to immediately repay the bank.
Mint
30-04-2025
- Business
- Mint
Trai, telecom companies spar over data demand
The Telecom Regulatory Authority of India (Trai) and telecom operators are at odds over the telecom regulator's request for regular business data needed to monitor services and ensure rules are being followed, two people in the know said. While Trai argues that data such as details for subscribers using specific recharge packs sought recently is essential for transparency and effective regulation, telcos have raised concerns over competitive sensitivity and the administrative burden they face for meeting those data sharing requests. This has led to a growing standoff between the two, one of the two people said. 'Trai is the sector regulator and its various divisions require data from telecom operators on a regular basis. This data is essential for Trai to check quality of service, compliance by the operators, competitive behaviour and most importantly to serve consumer interest," the second person said, adding that it is the obligation of telecom operators to share such information. Also read: Bharti Hexacom puts ₹ 1,134 cr tower sale deal with Indus Towers on hold after TCIL intervenes Under Section 12 of the Trai Act, 1997, the regulator has the right to call upon any service provider at any time to provide information or explanation relating to its affairs. The telecom operators, however, have raised concerns over this practice by Trai, especially on the diversity and increased cases of such requests by the regulator. 'The current operational framework requesting various data/reports by various divisions of Trai has raised significant procedural and business-related concerns that warrant immediate action of the authority," the Cellular Operators Association of India (COAI) said in a letter dated 10 February to Trai secretary Atul Kumar Chaudhary. Mint has seen a copy of the letter. COAI represents major telecom operators such as Bharti Airtel, Reliance Jio and Vodafone Idea. Queries emailed to COAI and Trai on Wednesday morning did not elicit any response. While COAI said the operators aim to support the regulatory process in the best possible manner, it said Trai should avoid asking for 'commercially sensitive" information. 'In certain cases, the data, information and presentations have been solicited with very short response timelines—which presents substantial operational challenges for TSPs (telecom service providers)," COAI said, adding that such short timelines put risk of either non-compliance to timelines or risk of information being submitted without adequate checks and balances. Also read: Telcos warn of network rollout delays as states lag on infra rules 'Yes, the telecom operators can seek time to provide information, but they should not suggest Trai to avoid making requests for business-sensitive information," said Satya N. Gupta, former principal advisor at Trai. According to Gupta, Trai can request any information. If the telecom operator thinks the information sought is business sensitive, they can request that Trai keep it confidential and not share it with others. In a five-point suggestion to Trai for seeking data, the telecom association said the regulator should do an impartial analysis to check for commercial sensitivity of the data before asking the telecom operators. 'Further, no data should be sought that is beyond the scope of the authority's powers and functions and pertains to other competent authorities like LEAs (law enforcement agencies)," COAI said. Besides, the association has asked for adequate time to comply with certain data requests. 'Failure to comply (with Trai's directions) may result in Trai issuing show-cause notices (to the operators), initiating enforcement actions or recommending penal measures to the Department of Telecommunications, which may include financial penalties or action under the relevant license conditions," said Sukrit Kapoor, partner at King Stubb & Kasiva, Advocates and Attorneys. 'While operators may raise concerns about commercially sensitive data, they cannot unilaterally refuse disclosure. However, if an operator believes that Trai's request is excessive, arbitrary, or outside the scope of its powers, it may approach the Telecom Disputes Settlement and Appellate Tribunal (TDSAT) under Section 14 of the Trai Act to seek relief," Kapoor added. Lately, there have been multiple disputes between the regulator and the telecom operators. Trai recently imposed a ₹ 141 crore financial disincentive on the operators due to their failure to curb spam. After operators approached the telecom tribunal, the penalty order was stayed. 'The next hearing of the case is on 25 July. Trai might seek an early hearing in the matter," said an official on the condition of anonymity. Also read: India's public wifi ambitions falters as telcos resist subsidising their rivals In February, the telecom operators also criticized Trai's new rules to curb spam calls and messages, citing that the authority has substantially increased the penalty imposed on the TSPs for not curbing spam. According to operators, Trai has left over-the-top (OTT) communication apps like WhatsApp and telemarketers outside its regulatory framework. The ministry of electronics and information technology (MeitY) will engage with stakeholders to tackle spam over OTT platforms, according to a Trai release on 25 April. The regulator is currently deliberating the contours of bringing telemarketers under the regulatory ambit,the official cited above added . Last year, Reliance Jio argued that Trai should revise the consultation paper on satellite spectrum pricing. The telecom operator said the Trai consultation overlooked issues related to a level playing field between telecom operators and satellite companies as it did not consider the spectrum auction method for satellite internet services. Trai, however, dismissed Jio's request, citing that the Telecom Act already paved the way for administrative (non-auction) allocation of satellite spectrum.
