Draft Telecommunication Bill, 2022 – Explained, pointwise

Introduction

The Department of Telecommunications (DoT), under the Union Ministry of Communications has released the Draft Telecommunication Bill, 2022 for public comments. The Bill seeks to replace the colonial era legislation that regulated the sector, the Indian Telegraph Act, 1885. Experts have praised the Bill for some progressive steps. At the same time concerns have been raised about some provisions that provide excessive powers to the Union Government regarding regulating the sector.

What is the current regulatory framework for Telecommunication Sector?

Legislations and Rules

The telecoms industry is regulated by the following central legislations: (a) the Indian Telegraph Act, 1885 (Telegraph Act); (b) the Wireless Telegraphy Act, 1933 (WT Act); (c) The Telegraph Wires, (Unlawful Protection) Act 1950; (d) the Telecom Regulatory Authority of India Act, 1997 (TRAI Act); (e) the Information Technology Act, 2000 (IT Act).

Additionally, there are several policies, circulars and notifications which are issued by the Department of Telecommunications (DoT), and the Union Government.

Audio-visual distribution is regulated under: (a) the Cable Television networks (Regulation) Act, 1995; (b) the Cinematograph Act, 1952; (c) the Sports Broadcasting Signals (Mandatory Sharing with Prasar Bharati) Act, 2007; (d) the Press Council Act, 1978; (e) the Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021 (IT Rules 2021). The Consumer Protection (E-Commerce) Rules, 2020, have also been notified to regulate e-commerce entities and may also extend to social media platforms.

Regulatory bodies

The Department of Telecommunications (DoT), Ministry of Communications, TRAl, and the Ministry of Information and Broadcasting (MIB) regulate the sector.

Telecommunications Engineering Centre (TEC) is responsible for drawing up of standards, generic requirements, interface requirements, service requirements and specifications for telecom products, services and networks.

The audio-visual media distribution industry is regulated by the MIB, as well as the Central Board of Film Certification (CBFC).

Self-regulatory bodies, namely, the Professional News Broadcasters Standards Authority, Internet and Mobile Association of India (IAMAI), the Indian Broadcasting Foundation, and the News Broadcasting Standards Authority, and the Broadcasting Content Complaints Council govern the sectors.

Further, the MIB has notified the following bodies for IT Rules, 2021 compliance: (a) Confederation of Online Media (India) – Indian Digital Publishers Content Grievance; (b) Web Journalists Standards; (c) Professional News Broadcasting Standards; (d) The Digital Publisher Content Grievances Council (IAMAI).

What is the need for the Telecommunication Bill?

The telecommunication ecosystem in India today has 117 crore subscribers and employs 4 crore people. The sector contributes around 8% of India’s GDP.

The existing regulatory framework for the telecommunication sector is primarily based on the Indian Telegraph Act, 1885. The nature of telecommunication, have undergone a massive change since the era of ‘telegraph’. The challenges associated with the communication technologies of present day like the 5G, Internet of Things are not covered under the existing legislations. Hence there is a need for a comprehensive legal framework that reflects the nature and need of telecommunication technology of 21st century.

Moreover, Telecom Spectrum has become a vital and strategic resource in the present times. There is a lack of comprehensive legal framework regarding the Spectrum like auction of spectrum. The draft Telecommunication Bill seeks to address this gap.

Through the Indian Telecommunication Bill, 2022, the Union Government aims to consolidate and amend the existing laws governing the provision, development, expansion and operation of telecommunication services, telecom networks and infrastructure, in addition to assignment of spectrum.

The draft Telecommunication Bill, consolidates three separate acts that govern the telecommunications sector — Indian Telegraph Act 1885, Indian Wireless Telegraphy Act 1933, and The Telegraph Wires, (Unlawful Protection) Act 1950.

What are the salient provisions of Draft Telecommunication Bill?

First, The draft Bill  incorporates some major expansions to the existing definitions of telecommunication services. ‘Over-The-Top’ (OTT) communication services have been included in the telecommunication services. This expands the definition widely to include all instant messaging, video, call applications like WhatsApp, Zoom, Telegram, Signal that run as services over the internet using data.

Second, The draft Bill deals with Licensing and Registration. It grants the Union Government the ‘exclusive privilege’ to ‘provide telecommunication services’, operate networks and issue licences to telecom service providers. As OTT platforms have been covered under Telecommunication Services, they may also have to seek licences to operate in India.

Third, the draft Telecommunication Bill provides for messages or communication over any telecommunication services to be intercepted and disclosed in the event of a public emergency.

Fourth, the Bill also covers issues related to Spectrum allocation. The Bill states that the Union Government shall assign spectrum to best serve the common good and ensure widespread access to telecommunication services. It may notify a National Frequency Allocation Plan (NFAP) for the use and allocation of spectrum.’

Fifth, The Draft Telecommunication Bill has provided a framework governing payment defaults by licensees, registered entities, or assignees, and allows the government to write-off of such amounts or part thereof. The Bill intends to reduce the burden on telecom companies by reducing the penalties levied. It seeks to make most of the offences cognisable.

Sixth, The draft Bill also accords the Union Government with powers to defer, convert into equity, write off or grant relief to any licensee under extraordinary circumstances, including financial stress, consumer interest, and maintaining competition, among other things. It also proposes to replace the Universal Service Obligation Fund (USOF) with the Telecommunication Development Fund (TDF). USOF is the pool of funds generated by the 5% Universal Service Levy that is charged upon all telecom fund operators on their Adjusted Gross Revenue. The USOF has largely been used to aid rural connectivity.

Seventh, Right of Way (ROW): The Bill tries to achieve through law, a ‘right of way’ (ROW) enforceable at the State and at the Municipal Corporation level. It lays down a framework in which a public entity that owns the land has to grant ‘right of way’ permission expeditiously unless it gives a substantive ground for refusal.

What are the concerns with the Draft Telecommunication Bill?

According to the Industry and Privacy experts, there are three broader aspects of the new proposed framework that stand out as major concerns and threaten the fundamental rights of Indian citizens: (a) Widely expanded definitions of telecommunication and licence requirements for internet-based applications; (b) Threats to online privacy and the undermining of strong encryption and surveillance concerns; (c) The provisions to suspend the internet at a time when India already suffers the highest number of internet shutdowns in the world.

First, the licence regime for OTT services is likely to have two consequences; (a) The cumbersome KYC process where users will have to register for usage as they do for SIM cards and phone connections. This is a deep concern from a surveillance and freedom of speech aspect as well; (b) This may also spur data localisation demands, one that has been a controversial provision in the now withdrawn Personal Data Protection Bill, 2019.

Second, Given that OTTs have also been defined as telecom services, industry stakeholders have raised the concern of end-to-end encryptions being weakened or possibly broken in order to intercept the communications. Thus, the draft Telecommunication Bill appears to have ignored appeals for surveillance reforms including the landmark ruling in 2017 by the Supreme Court, affirming the right to privacy as a fundamental right enshrined in Article 21 of the Constitution of India.

Third, On the occurrence of any public emergency or in the interest of the public safety, the Union or State Governments can order the suspension of communication services on any telecommunication network. Internet shutdowns are a threat to an open and free internet and also cause immense economic losses amounting to billions of dollars.

Fourth, Bankruptcy provisions: Though the intent of the bankruptcy provisions in the draft Telecommunication Bill is noble, the Union Government might face huge difficulties in executing them. The Bill also overrides provisions of the Insolvency & Bankruptcy Code (IBC), which might complicate resolution proceedings.

Fifth, The draft Bill plans to confine TRAI’s powers to making recommendations only if requested by the DoT. At present, TRAI has no powers of enforcement of its directives and can’t levy penalties on telecom companies. If this Bill is passed, TRAI can’t even make suo moto recommendations, and will become defunct.

Sixth, experts argue that regulatory framework should regulate aspects related to infrastructure and hardware of telecommunication network. It should interfere with ‘layers of software’ that ride over the hardware. This can lead to stifling of innovation in telecommunication technologies.

What should be the approach going ahead?

The Draft Telecommunication Bill is open for comments by public till October 20, 2022. After that the Government will review the suggestions and may make changes to the provisions of the Bill, before introducing the Bill in the Parliament.

The Government must address the concerns related to privacy of the users. In addition, the provisions in conflict with the IBC can also be reviewed and rectified in order to remove any confusion and delay in proceedings.

Conclusion

The draft Telecommunication Bill in its present form, while vague on certain provisions, points towards the general direction in which the Union Government wants to take telecom sector and its regulation.  As India embarks on its Amritkaal phase, there have been calls for liberation from the colonial mindset. Hence, the Government must remove the provisions which are similar to the colonial-era legislations.

Syllabus: GS II, Government policies and interventions for development in various sectors and issues arising out of their design and implementation;  GS III, Infrastructure.

Source: Indian Express, Indian Express, The Hindu, Business Standard, Mint, Mint