Big step! TRAI fixes penalty for breaching interconnection regulations

By: | Published: January 3, 2018 5:22 AM

The Telecom Regulatory Authority of India (Trai) on Tuesday released a detailed set of regulations for interconnection pacts between operators and mandated a daily penalty of Rs 1 lakh per circle for non-compliance of these norms.

trai, Telecom Regulatory Authority of India, trai fixes penalty, interconnection regulations, breach in interconnection regulations, Telecom Interconnection RegulationsTrai on Tuesday released a detailed set of regulations for interconnection pacts between operators and mandated a daily penalty of Rs 1 lakh per circle for non-compliance of these norms. (Image: Reuters)

The Telecom Regulatory Authority of India (Trai) on Tuesday released a detailed set of regulations for interconnection pacts between operators and mandated a daily penalty of Rs 1 lakh per circle for non-compliance of these norms. The Telecom Interconnection Regulations, 2018, which will come into effect from February 1, stipulate that “every service provider shall, within thirty days of receipt of request from a service provider, enter into interconnection agreement, on a non-discriminatory basis”. It also states that any operator receiving the request for interconnection would have to send a draft interconnection agreement to the service provider which made the request within five working days. The service provider that makes the request has also been given five working days to submit “suggestions and objections”. At present, there is no explicit timeline for inking such agreements. On the BSE Sensex, shares of listed telcos tumbled intraday post the announcement. While Bharti Airtel’s shares plunged 0.70% to Rs 524.45 apiece at 1230 hours, Idea Cellular and Reliance Communications’ stock fell 3% and 4.94%, respectively, on the 30-scrip index. On interconnection charges, the regulator said, “The interconnection charges such as set-up charges and infrastructure charges may be mutually negotiated between service providers subject to the regulations or directions issued by the Authority from time to time, provided that such charges are reasonable, transparent and non-discriminatory”.

In the case of non-compliance with these regulations, an operator would be “liable to pay an amount, by way of financial disincentive not exceeding rupees one lakh per day per licensed service area, as the Authority may direct”. For provisioning of ports at the points of interconnection (PoIs), Trai has fixed a 30-day period, as against the earlier mandated 90 days. These regulations assume significance as during 2016 and 2017, Reliance Jio and incumbent operators — Bharti Airtel, Vodafone India and Idea Cellular — were locked in a bitter feud over providing PoIs to the former, even before its commercial launch on September 5, 2016.

Jio alleged that incumbents were not providing it with enough PoIs that were required to connect calls between different networks, which was leading to a majority of its calls failing. The matter was arbitrated by Trai, following which incumbent operators released more PoIs. However, the matter did not get fully settled with both sides indulging in mud-slinging. Subsequently, on October 21, 2016, Trai recommended a fine of Rs 50 crore per circle against the three incumbent operators for denying sufficient PoIs to Jio. While a fine of Rs 50 crore each for 21 circles was recommended for Bharti and Vodafone, Idea had to cough up the same amount for 19 circles. The issue of penalty became a matter of contention between Trai and the department of telecom with the former declining to revise the amount. At present, the penalty issue is being examined by a committee in the DoT.

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