Telecom tribunal scraps TRAI predatory pricing norms

• In a hard-hitting judgement, telecom tribunal Telecom Disputes Settlement and Appellate Tribunal (TDSAT) on Thursday quashed Telecom Regulatory Authority of India’s (TRAI) rule on predatory pricing and discounted tariffs, spreading Christmas cheers among telecom operators.TDSAT Bench comprising Justice SK Singh and member AK Bhargava said that the impugned tariff amendment order is set aside in so far as it changes the concept of significant market player (SMP), non-predation and the related provisions.

Key highlights about the pricing norms

• The regulatory order that gave a new entrant like Jio pricing flexibility till it acquired 30 per cent share of the market’s subscribers or revenue “appeared an unnecessary abdication of its regulatory powers by the TRAI” in the context of tariff conditions and their enforcement.

• It had asked the regulator to reconsider the provisions within six months.
• The order means telecom operators such as Bharti Airtel and Vodafone Idea can continue offering customised discounts to retain subscribers and “therefore, need no reporting in the manner prescribed for regular tariff plans”.

• Moreover, instead of reporting of all such discounted offers not falling within the cap of 25 tariff plans, TRAI may call for details of any segmented offer about which it may receive specific complaints.

• The incumbent operators had, during the course of the hearings, argued that reporting segmented offers would only help rivals as they were a trade secret of the company.

• COAI has indicated that the regulation favoured Reliance Jio, and that the order has distorted the market, placing all other operators at a “serious disadvantage”.

• In February, the TRAI had issued new norms which required telecom operators to transparently disclose on their websites segmented offers aimed at retaining customers.

• The new norms also stated that in case of violation of tariff reporting requirements, an operator can be penalised `5,000 for every day of delay.

Faster number porting

• TRAI has sped up process for a mobile user to port to a new telecom service provider to two days, when done within the same circle and four days when porting from one circle to another.

• TRAI, on Thursday, also suggested imposing a penalty of Rs 10,000 on telecom operators every time they provide false info regarding a mobile number porting request.


Mains Paper 2: Indian Polity | Statutory, regulatory and various quasi-judicial bodies.

Prelims level: TDSAT, TRAI

Mains level: Regulating market players in Telecom sector and the role of TDSAT

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