Spectrum Is Like Atma, License For Whatsapp, Zoom: Takeaways From The Draft Telecom Bill 

The Bill seeks to replace the existing legal framework governing telecommunication in India
Spectrum Is Like Atma, License For Whatsapp, Zoom: Takeaways From The Draft Telecom Bill 

The government on Wednesday released the draft Indian Telecommunication Bill, 2022, with an aim to bring changes in the telecom sector’s regulation.  

New-age over-the-top communication services like Whatsapp, Zoom, and Skype, among other apps which provide calling and messaging services may soon require licenses to operate in the country, according to the draft bill. 

What The Draft Telecommunication Bill Is All About? 

To simplify the rules governing the sector, the Telecom Ministry initiated a public consultative process and in July 2022, it published a consultation paper on ‘Need for a new legal framework governing telecommunication in India’. 

The Telecom Ministry examined the relevant legislations in the UK, US, Australia, Japan, the European Union, and Singapore to prepare the draft.

Through the Indian Telecommunication Bill, 2022, the Centre aims to consolidate and amend the existing laws governing telecommunication services, telecom networks, and infrastructure. 

The Bill seeks to replace the existing legal framework governing telecommunication in India, including the Indian Telegraph Act, 1885, the Wireless Telegraphy Act, 1933, and the Telegraph Wires (Unlawful Possession) Act, 1950. 

Key Amendments Proposed  

One of the key changes is the inclusion of new-age over-the-top (OTT) communication services like WhatsApp, Zoom, Signal, and Telegram in the definition of telecommunication services.

As per the draft law, providers of telecommunication services will be covered under the licensing regime and will be subjected to similar rules as other telecom operators. 

This comes after telecom service providers sought OTT players to be treated in the same manner as them since they pay for licenses and spectrum, while the apps offer free services using their infrastructure. 

At present, telecom companies need to have a license to offer services, while OTT platforms do not. If these services are brought under the ambit of telecom services, they will need a license to offer services. 

The draft proposes that the definition of ‘telecommunication’ be expanded to include over-the-top (OTT) services, satellite-based communication services, internet-based communication services, in-flight and maritime connectivity services, interpersonal communications services, and machine-to-machine communication services. 

‘Spectrum Is Similar To Atma…’ 

When it comes to spectrum, the draft says, “In a way, spectrum is similar to Atma, which is ajar, amar, as described in Bhagwad Gita. Like atma, spectrum to does not have any physical form, yet it is omnipresent.” 

The bill says “spectrum is a scarce natural resource” and proposes it to be allocated only through auction. It however says the spectrum can be assigned through the administrative process for defence, transportation and research, etc. 

The DoT has also proposed that if a telecom entity in possession of spectrum goes through bankruptcy or insolvency, the assigned spectrum will revert to the control of the Centre.  

So far, in insolvency proceedings, there has been a lack of clarity on whether the spectrum owned by a defaulting operator belongs to the Centre, or whether banks can take control of it. 

Likewise, the spectrum allocated to telecom companies that are undergoing insolvency and are unable to offer services, pay dues or comply with license conditions, will be taken back by the government. 

The government will also have the power to terminate spectrum allocations partly or in full, if it determines that assigned spectrum has remained unutilised for insufficient reasons over a period of time. 

What Else Is There For The Telecom Industry? 

To prevent cyber fraud, the Bill provides that the identity of the person sending a message through telecom services shall be available to a user receiving it. 

In case a telecom or internet provider surrenders the licence, the draft bill has a provision to refund the fees. It says, the government can "waive in part or full any fee, including entry fee, licence fee, registrations fee or any other fee or charges, interest, additional charges or penalty" for the licence holder. 

The bill also proposes to simplify the framework for mergers and acquisitions, demergers and acquisitions, or other forms of restructuring, “by only requiring intimation to the licensing authority." 

The draft Bill also proposes to change the name of the Universal Service Obligation Fund (USOF) to the Telecommunication Development Fund (TDF). The amount received under USOF comes from the annual revenue of telecom services providers. The amount received under the TDF will be credited to the Consolidated Fund of India and utilised to boost connectivity services in underserved areas in India.

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