Draft telecom bill proposes waiving off dues, licensing of OTT apps

Platforms such as WhatsApp, Zoom, Netflix may come under the ambit of telecom services that require a licence

The government has released the draft of ‘The Indian Telecommunication Act, 2022’ wherein it has proposed several significant changes, including provisions for waiving off dues for financially stressed operators, bringing over-the-top platforms (such as WhatsApp, Zoom, Netflix) within the ambit of telecom services that require a licence to operate and provisions for message interception in case of public emergency.

The draft Bill, which was released late on Wednesday night inviting comments from stakeholders, seeks to replace the existing legal framework comprising the Indian Telegraph Act, 1885, the Wireless Telegraphy Act, 1933 and the Telegraph Wires (Unlawful Possession) Act, 1950, that currently govern the telecom sector.

“It’s not just government as big regulator and industry the regulated, but an interactive system in which industry’s concerns are addressed by the government and the government’s concern are duly taken into consideration by the industry. That is important because we have to look at the protection of users...,” Telecom Minister Ashwini Vaishnaw said on Thursday.

The explanatory note on the draft Bill said it aimed to consolidate and amend existing laws governing provision, development, expansion and operation of telecommunication servicesnetworks and infrastructure, and assignment of spectrum.

“Spectrum is a valuable and inexhaustible natural resource, which has an element of public good. Therefore, it is vital to ensure efficient use and management of spectrum... ,” the Centre said in the note.

The draft Bill proposed a special framework to address defaults in payment by a licencee or a registered entity, wherein under “extraordinary circumstances”, the government may allow for deferment of the payment of such amounts, conversion of a part or all of the amounts into shares in the licencee or even write-off of such amounts.

The draft Bill also simplifies the framework for mergers, demergers and acquisitions, for which the entities will need to comply with the scheme for restructuring as provided under the Companies Act, 2013, and only need to inform the Department of Telecommunications. Further, if the licensee is undergoing insolvency proceedings it can continue to operate if it continues to provide telecom services and does not default on payment of dues. However, if the entity is unable to comply, then the assigned spectrum will revert to the control of the government. It “also seeks to create disincentive for acquiring spectrum at a value lower than auction-determined price.”