The Telecommunication Act, 2023

Trishaljeet Singh
Trishaljeet Singh

Published on: Dec 17, 2022

Sumit Kaushik
Sumit Kaushik

Updated on: Jan 13, 2024

(32 Ratings)
4912

INTRODUCTION:

Indian Telecom Industry is the second largest in the world and contributes around 8% towards growth of India’s GDP with a subscriber base of 1.17 Billion as of 2022, Although since past few years there is an exponential growth in the industry, which is driven by affordable tariffs, wider availability, roll-out of Mobile Number Portability (MNP), expanding 3G, 4G & 5G coverage, growing consumption patterns of subscribers, Government’s initiatives towards bolstering India’s domestic telecom manufacturing capacity, yet till now the regulatory framework for the telecommunication sector is based on the Telegraph Laws which our country has stopped using in 2013.

It is in this context in order to streamline the legal and regulatory framework for the telecommunications sector, the Department of Telecommunications (DoT) and the Ministry of Communications on which was initially released on 21st September 2022 as Indian Telecommunication Bill, 2022 which was put for recommendations and suggestions from public in general and stakeholders.

The following Acts will be replaced:-

framework governing Telecommunication in India

BACKGROUND:

The Bill was passed on 18th December 2023 and was passed by Lok Sabha and Rajya Sabha on 20th December 2023 and 21st December 2023 simultaneously. The bill has now enacted into law after receiving President assent on 24th December 2023. The Act seeks to amend and consolidate the law relating to the development, expansion, and operation of telecommunication services. The Act has also amended some provisions of Telecom Regulatory Authority of India (TRAI) Act, 1997.

OBJECTIVES:

  • To Reform Existing Telecom laws and regulations to make them future ready.
  • 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.
  • To ensure availability of affordable, reliable, secure and universal telecommunication services.

KEY DEFINITIONS:

  • Telecommunication means a transmission, emission or reception of any messages, by wire, radio, optical or other electro-magnetic systems, whether or not such messages have been subjected to rearrangement, computation or other processes by any means in the course of their transmission, emission or reception.
  • Telecommunication Services means service for Telecommunication.
  • Telecommunication Network: means a system or series of systems of telecommunication equipment or infrastructure, including terrestrial or satellite networks or submarine networks, or a combination of such networks, used or intended to be used for providing telecommunication services, but does not include such telecommunication equipment as notified by the Central Government.

KEY HIGHLIGHTS/PROVISIONS OF THE ACT:

  1. CHAPTER 2 POWERS OF AUTHORISATION & ASSIGNMENT
    • Authorisation Regime
      The Act empowers the Government to provide approval for providing services, operating networks, and possessing radio equipment. Existing licenses remain valid for their granted period or up to 5 years if specified. The companies will require authorisation to start providing telecom services instead of licences that are issued at present. Fees or charges apply for different services, networks, equipment.
    • Spectrum Management
      The Act addresses the Government powers to assign spectrum for telecom services. While it identifies ‘auctions’ as the primary method for assigning spectrum, it explicitly allows administrative assignment of spectrum for the following Satcom Services:
      • National Security, Defence, Public Broadcasting, Safety in Public Transport Services, Conservation of Natural Resources/Wildlife etc.
      • Meteorological Purposes
      • Amateur Stations, Navigation, Telemetry
      • Space Research, Launch Vehicle Operations
      • Certain specified Satellite Services
      • Testing, Trial, Demonstration Purposes
      The Government may amend the above list in public interest.  This marks a departure from the 2022 Bill, where there was no explicit mandate to administratively assign spectrum for satcom services, except when the government deems fit in cases of ‘public interest’ or ‘necessity’.
    • User protection & verification
      Telecom service providers must identify individuals by using to be prescribed ‘verifiable biometric based-identification’ methods. The obligation has been included for the goal of consumer protection, to reduce spam calls and messages, and prevent SIM-based fraud. Concerns have been raised about how the privacy invasive nature of this measure, how collected biometric data shall be safeguarded, and the technical feasibility of effectively implementing digital biometric verification.
    • Technologically neutral utilisation of spectrum
      Section 6 allows to facilitate the utilisation of spectrum in a flexible, liberalised, and technologically neutral manner. This is a crucial aspect that fosters a level playing field for different technological solutions by ensuring that the government does not impose restrictions based on specific technologies.
  2. CHAPTER 3 RIGHT OF WAY FOR TELECOMMUNICATION NETWORK
    Right of Way is a legal framework and a pre-requisite for setting up telecom infrastructure and improvement of telecommunication services. The current regulatory framework is based on Right of Way Rules, 2016, which has a very limited impact in addressing bottlenecks in rapid expansion of telecommunication infrastructure. As such in order to provide Right of Way in Uniform, non-discriminatory manner and on a non-exclusive way for establishment of telecommunication infrastructure the Act provides a framework for obtaining Right of Way.
  3. CHAPTER 4 PUBLIC SAFETY & PROTECTION OF TELECOMMUNICATION SERVICES
    • Section 19 empowers the Government to notify standards and conformity assessment measures in respect of encryption and data processing in telecommunication. It will be important to review such standards and measures to assess the scope of traceability and interception of data.
    • Section 20 provides that a message or a class of messages exchanged between 2 or more persons could be directed by the Central Government and State Government to be intercepted in intelligible format, monitored, and prevented from being transmitted, in the interest of public emergency and public safety.
  4. CHAPTER 5 DIGITAL BHARAT NIDHI
    • The Universal Service Obligation Fund under Telegraph Act, 1885 has been renamed as Digital Bharat Nidhi to provide for telecom services in underserved areas. It is a pool of funds generated by collection of 5% of the universal service levy that is imposed on telecom service providers.
    • The Fund will be utilised exclusively to meet any or all of the following objectives, namely:-
      • support universal service through promoting access to and delivery of telecommunication services in underserved rural, remote and urban areas
      • support research and development of telecommunication services, technologies, and products
      • support pilot projects, consultancy assistance and advisory support towards provision of service under clause (a) and
      • support introduction of telecommunication services, technologies, and products.
  5. CHAPTER 6 REGULATORY SANDBOX
    The Central Government, for the purposes of encouraging and facilitating innovation and technological development in telecommunication, create one or more regulatory sandboxes. The expression “regulatory sandbox” refers to a live testing environment where new products, services, processes and business models which may be deployed, on a limited set of users, for a specified period of time, with certain relaxations from the provisions of this Act. Sandbox frameworks were being used in Financial Technology and Products, However, it is, for the very first time being used in Telecom Sector.
  6. CHAPTER 8 ADJUDICATION OF CERTAIN CONTRAVENTIONS
    • The Central Government will appoint 1 or more adjudicating officers. These officers, not below the rank of joint secretary in the Central Government, will conduct inquiries related:
      • pass an order in writing in respect of one or both of the following, namely:—
        • direct such authorised entity, or assignee to do or abstain from doing any act or thing to prevent such breach or for such compliance;
        • impose civil penalties as specified in the Second Schedule; and
      • make recommendations for the consideration of the Central Government regarding suspension, revocation, or curtailment of the duration of the authorisation or assignment.
    • When imposing penalties specified in the second schedule, the adjudicating officer shall take into account the following factors:-
      • Nature, gravity, and duration of the contravention.
      • Number of persons affected by the contravention and the level of harm caused.
      • Intentional or negligent character of the contravention.
      • Repetitive nature of the contravention.
      • Mitigating action, if any, including providing a voluntary undertaking.
      • Revenue loss caused to the central government.
      • Any aggravating factors relevant to the circumstances of the case, such as the amount of disproportionate gain or unfair advantage, wherever quantifiable.
  7. CHAPTER 9 OFFENSES & PENALTIES
    • The Act specifies various criminal and civil offenses. Providing telecom services without authorisation, or gaining unauthorized access to a telecom network or data, are punishable with imprisonment up to 3 years, a fine up to 2 crore rupees, or both.
    • Breaching terms and conditions of authorisation is punishable with a civil penalty up to 5 crore rupees.
    • Possessing unauthorized equipment, or using unauthorized network or service, is punishable with a penalty of up to 10 lakh rupees.
    • Section 43 Any officer authorised by the Central Government in this behalf, may search any building, vehicle, vessel, aircraft or place in which he has reason to believe that any unauthorised telecommunication network or telecommunication equipment or radio equipment in respect of which an offence punishable under section 42 has been committed, is kept or concealed and take possession thereof.
  8. SECTION 59 AMENDMENTS IN TELECOM REGULATORY AUTHORITY OF INDIA (TRAI) ACT, 1997
    • Substitution in definition of Licensee, Licensor, Telecommunication, Telecommunication Services.
    • In whole Act wherever the Indian Telegraph Act, 1885 or the Indian Wireless Telegraphy Act, 1933″, the words, figures and brackets “the Telecommunications Act, 2023 or the Cable Television Networks (Regulation) Act, 1995” shall be substituted.
    • The amendment to the Telecom Regulatory Authority of India (TRAI) permits individual with a minimum of 30 years of experience for the Chairperson role and 25 years of experience for members.

IMPACT ANALYSIS

Drawbacks

  1. The Act raises concerns about potential infringement on citizens fundamental rights. Certain provisions like clause 3(7) requiring verifiable biometric identification and clause 29 mandating truthful information as to identity while availing telecom services will impact whistleblower and journalist who wish to keep their identity anonymous.
  2. The increased penalties for unauthorized services on the basis of reason to believe so may be misused and raise potential disadvantages for users as burden of prove will be on users.
  3. The provision allowing interception, blocking, and monitoring of messages between individual may lower the level of privacy.

Benefits

  1. The Act makes it mandatory for the entities to develop a Caller-ID feature to ensure that the identity of the person communicating is visible.
  2. Central Government has set up an alternate dispute resolution mechanism for dispute resolution.
  3. License granted under current laws will be permitted to operate with their former licenses until migration.
  4. Right of way – The facility provider can seek permissions for right of way for telecommunication infrastructure.
  5. Stringent provisions for phone number spoofing for fraud and online grievance redressal mechanism for addressing users’ complaints.
  6. Extra territorial application of the Act if the service provide in India or equipment or network located in India

Disclaimer

The information provided in this article is intended for general informational purposes only and should not be construed as legal advice. The content of this article is not intended to create and receipt of it does not constitute any relationship. Readers should not act upon this information without seeking professional legal counsel.

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