Indian Draft Telecom Bill 2022 — Changes and Implications (Part1)
The draft telecom bill is out for public consultation. I want to take this opportunity to do a series of notes, by picking a specific theme from the draft bill (2022) each time — critically examining it, and then comparing it with the current Telegraph Act of 1885. The idea is to evaluate whether the provisions enacted in the draft bill (2022) are new, or had already existed in the current Act of 1885. In this note (part1), I plan to specifically discuss the theme of the provision of licensing (granted by the government by relinquishing its exclusive privileges under the current Act of 1885), and what additional empowerment the government is arming itself with (under the umbrella of this new theme) by bringing the proposed law to the table. While doing so, we will also discuss whether these provisions (new clauses under the theme, i.e “power to license”) are novel, or whether the existing Act of 1885, could have been interpreted to invoke these provisions.
For us to make specific conclusions in this regard, we have to critically examine the clauses and provisions under the existing Act (1885) and compare them with the proposed Act (2022).
Current Act (1885)
The word “telegraph” is defined in Clause 3(1) and described below.
“telegraph” means any appliance, instrument material, or apparatus used or capable of use for transmission or reception of signs, signals, writing, images, and sounds or intelligence of any nature by wire, visual or other electromagnetic emission, Radio waves, or Hertzian waves, galvanic, electric or magnetic means.
The word “message” is defined in Clause 3(1) and described below.
“message” means any communication sent by telegraph or given to a telegraph office to be sent by telegraph or to be delivered.
Now the exclusive privilege of the Central Government and its power to grant licenses are defined in Part II, Clause (4) as under.
Within India, the Central Government shall have the exclusive privilege of establishing, maintaining and working telegraphs
Provided that the Central Government may grant a license, on such conditions and in consideration of such payments as it thinks fit, to any person to establish, maintain or work a telegraph within any part of India.
Please note the mention of the word “work”. This can be interpreted as the power to use the “telegraph” (which in modern terminology shall be “telecom network”) and send messages across it. In other words, as per the Current Telegraph Act of 1885, the Central Government not only has the exclusive privilege of establishing, and maintaining telecom networks but also using them to send messages across them.
Draft Telecom Bill (2022)
In the current Act (Indian Telegraph Act of 1885), there is no explicit mention of the word “Telecommminication Service”, but the definition can be extracted from the word “message” as defined in Clause 3(2) of the earlier 1885 Act as mentioned in the earlier part of the discussion.
Hence, it is clear that under the current Act of 1885, any message flowing over the telegraph (telecom network) can be interpreted as a “Telecommunication Service” without leaving any out of its purview. However, the proposed draft limits and streamlines the definition of “message”, as is mentioned in the current Act (1885) which is described in Clause 2 (21) of the new proposed bill (2022) and is reproduced below for reference.
“telecommunication services” means services of any description (including broadcasting services, electronic mail, voice, video, and data communication services, audiotex services, videotex services, fixed and mobile services, internet and broadband services, in-flight and maritime connectivity services, interpersonal communication services, machine to machine communication services, over-the-top (OTT) communication services which is made available to users by telecommunication, and any other services that the Central Government may notify to be telecommunication servics.
Please note, as regards OTT, the explicit inclusion of the word “communication services”. However, the word “communication service” hasn’t been defined in the draft. Hence, it is natural for stakeholders to ask which types of OTT apps will fall under the purview of the definition of “telecommunication service”. This is not clear unless it is defined in the draft explicitly by stating examples.
As mentioned earlier, in the current Act (1885), the Central Government has the exclusive privilege of establishing, maintaining, and working telegraphs. However, the Draft (2022), just adds one more item into the bucket of exclusive privilege, i.e Clause 1(c) — use, allocate, and assign spectrum.
Also, in the new Draft (2022), the word license has been further sub-classified into four distinct kinds of empowerment — each mapped to a specific vertical [Clause.3(2)/(3)].
a) License — For providing telecommunication services or establishing, operating, maintaining, and expanding telecommunication networks.
b) Registration — For providing telecommunication infrastructure.
c) Authorization — For the procession of wireless equipment.
d) Assignment — Of Spectrum.
e) Exemption — At Central Government’s discretion [Clause 3(3)].
Note, the word “Telecommunication Infrastructure” is defined in Schedule 5 of the Draft, and includes only passive equipment.
Implications
Based on the above discussion it is clear that the current Telegraph Act of 1885 is expansive (covers all kinds of services under the sun), and it also empowers the Central Government to license these services at terms and in consideration as it deems it.
However, the proposed bill (2022) can be seen limiting this set of services to under the bucket of a theme — called “Communication Services”. But it has not defined what this terminology means. This has created huge confusion — a hue and cry in the public domain that the GoI is preparing the ground to regulate all kinds of OTT services.
But based on the above discussion it is clear that the GOI does not need a new Act to regulate OTT services. The Current Act of 1885, has all the provisions it needs if it intends to do so.
The other major implication is the inclusion of the word “registration” for providing telecom infrastructure. And, the term “Telecom Infrastructure” has been clearly defined in Schedule 5 as including only “Passive Equipment”. Hence, once the bill converts into law then it will be impossible to “Active Elements” under the bucket of “Registrations” — pending demand of the IP1 lobby.
Conclusion
The current Act of 1885 is expansive and includes all kinds of services. And the GOI can license these services if it intends to do so. Actually, for this, it does not need a new Act. On the contrary, the draft bill only tries to streamline the services which may fall under the category of license. However, calling out these services does mean that GOI intends to license them all. For this please refer to clause 3(2) of the draft (2022) reproduce under.
The Central Government may exercise its privilege under sub-section (1) by granting to any entity, in the manner as may be prescribed
This is totally in alignment with the Current Telegraph Act of 1885, where the same word “may” has been used (1st Proviso of Clause 4(1)) to describe the Central Government’s power to license.
The GOI has been invoking this clause to license only those services that (according to it) made sense and are each to manage with minimal transaction cost, and the GOI is likely to follow the same principle in the future as well.
The other issue is the finality of the long pending demand for the inclusion of “Active Element” under the bucket of IP1 registration. The proposed draft defines “Telecom Infrastructure” in Schedule 5 to include only “Passive Elements”, and hence IP1 lobby’s demand will get put to rest once this draft bill become law.
To be continued in part(2)…
(Views expressed are of my own and do not reflect that of my employer)
PS: Find the list of other relevant articles in the embedded link.
