Friday, 12 May 2017

Trai to defend suggestion to fine Airtel, Vodafone, Idea Rs 3,050 crore

The telecom regulator is set to stress that it has the power to recommend penalties on operators, defending its suggestion that Bharti Airtel, Vodafone India and Idea Cellular be fined a total of Rs. 3,050 crore for not providing adequate points of interconnect to Reliance Jio Infocomm.

The Telecom Regulatory Authority of India will soon give a point-by-point rebuttal to the Telecom Commission, saying it had “carefully considered” all aspects and rules while making its initial suggestions last October and that it will not reconsider the matter, people aware of the developments said. The highest decision-making body in the telecom department had questioned the regulator’s methodology and its basis for recommending penalties in February, even asking whether Trai has the power to recommend such fines.

“If the Authority has the power to recommend cancellation of licences, it also has the power to operate within the confines of the licence to recommend a penalty, which, in this case, was Rs.50 crore per circle,” one of the people said. While the rules allow revocation of licences in cases of violation, Trai had only recommended penalties so that customers are not inconvenienced, the people said.

“Trai has taken a very careful view and put everything on the table before recommending, so it can give a resounding reply that what was done was right. It’s a recommendation to DoT, it’s up to them to accept it or reject it,” another person added. The penalties suggested by the regulator amount to Rs. 1,050 crore each for Bharti Airtel and Vodafone India and Rs. 950 crore for Idea.

Trai said the top three telcos in the country had violated licence norms by denying adequate interconnection points to Jio, an act that appeared to be aimed at stifling competition, was anticonsumer and was against public interest. The telcos denied wrongdoing. Vodafone and Idea moved court contending Trai does not have the power to recommend penalties.

In February, the Telecom Commission asked Trai to clarify almost a dozen points, including whether the stipulated 90-day period was given to the three telcos to provide PoIs to the newcomer. It also sought clarity on the basis of which the penalty amount was calculated and the provision in the law that enabled Trai.

Trai’s response will made to the Telecom Commission, an inter-ministerial panel with the Department of Industrial Policy and Promotion secretary, economic affairs secretary, Niti Aayog chief executive officer and IT secretary as members, which will take the final call on the issue. The panel is headed by telecom secretary Aruna Sundararajan, who was given charge of telecom on Wednesday in addition to her role as IT secretary.

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