Penalty can be up to Rs 1,000 cr
The Telecom Regulatory Authority of India (Trai) has issued a show-cause notice to state-owned Bharat Sanchar Nigam (BSNL) for not complying with the Telecommunication Interconnection Regulation 2018, according to people aware of the matter.
The regulations cover a framework that involves network connection arrangements between telcos for easy connectivity of calls and SMSes to their consumers; bank guarantees by telcos which are net payable to others in a particular circle; and the provision of point of interconnections for call/SMS traffic management.
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According to the sources, BSNL has failed to give bank guarantees to telecom operators such as Vodafone Idea, Bharti Airtel and Reliance Jio for the circles where it is net payable. Further, the state-owned telco has also not even implemented the required ports at point of interconnections (PoI) for facilitating outgoing traffic of telcos, they said.
According to officials, the show-cause notice was sent to BSNL in May and the company is yet to revert on that.
The issue of the violation of such regulations has again come to limelight after seven years when Trai had recommended a penalty of Rs 3,050 crore on Airtel, Vodafone and Idea (they were separate entities) for allegedly denying inter-connectivity to Reliance Jio, who was the fresh entrant to the market.
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According to the regulations, the financial penalty in the case of non-compliance could be Rs 100,000 per day per service area for each of the non-compliance. It could also go up to Rs 1,000 crore for BSNL since it has not complied with the regulations from the start, the sources said.
Simply put, when an Airtel user dial a call or sends an SMS to a user on a BSNL or a Vodafone Idea network, the same is smooth because of interconnection agreement with the telcos. This arrangement also involves network usage and carriage charges to be paid by one telco to another for using another’s network in the form of bank guarantees.
In the absence of required PoIs, the quality of services for consumers get affected in circles where BSNL has major consumers. The same also affects other telcos, whose quality of connections also get affected because of violation of interconnection norms by some of the companies, experts said.
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“Ofcourse, it affects the quality of services but it is more of a level-playing field between the telcos. BSNL has not complied with the regulations from the day they were notified,” an executive at a telecom operator said on the condition of anonymity.
According to the executive, it is not affecting other telcos in a significant manner as BSNL market share is continuously declining.
Another violation by BSNL with regard to the regulations is that the company has been asking for bank guarantees from telcos for an amount equivalent to three months gross billing whereas the TRAI regulation provides for bank guarantee to be given for an amount equivalent to two months net billing.
Net billing means amount arrived after the deduction of receivables and payables.
BSNL is currently working on launching its 4G services. The company had recently launched the beta services in Amritsar, Punjab. Currently, BSNL has a mobile subscriber market share of close to 9%.
