Compliance burden continues to increase: COAI’s Rajan S. Mathews
New Delhi: The Cellular Operators Association of India (COAI) will soon write to the Department of Telecommunications, pointing out that the compliance burden on telecom service providers will increase if the Telecom Regulatory Authority of India’s (Trai) recent recommendations on net neutrality are accepted by the government.
The “anti-provisions” laid out in the recommendations will only lead to compliance and enforcement issues and operators will resort to approaching the courts if penalties arise, COAI director general Rajan S. Mathews said in an interview.
Mathews added that since India borrowed the definition of net neutrality from the US, which now plans to repeal its existing rules on the issue, Trai is obligated to explain why the changed definition will not be applicable to India. The Federal Communications Commission of the US, headed by Republican Ajit Pai, plans to repeal its existing rules on net neutrality at the regulator’s meeting on December 14. Edited excerpts:
What do you think of Trai’s recommendations on net neutrality?
The compliance burden continues to increase. That’s all it does. Regulation-wise, if you really look at what happens in the marketplace, when you look at ‘don’t-throttle-don’t-discriminate’, we had agreed to this two years ago.
This whole thing has been going on from 2015. Our bigger issue was how you would treat OTT (over-the-top) services such as WhatsApp? What are we going to be able to do to allow operators to do things to connect the next billion? Because, you should be able to give subsidies, etc., for select groups and people. For example, if I go to urban areas and there is a definitive issue of affordability, why shouldn’t they give it away for free and if somebody is willing to pay me for it in terms of a back-end agreement, I should be able to do it as long as nobody else is disenfranchised in the process. As long as nobody else is hurt, doing something that allows me to address the needs of a certain group of people, (that) should be allowed.
Do you feel that the regulatory body’s influence has been growing over the sector?
When you say influence, by virtue of the fact that it has undertaken a lot of consultation papers, it has had an impact…see, if many of them end up in court or are opposed by the industry, what have you really achieved?
Look at this whole issue of interconnect. That is in court. The call drop issue came up; it is in court. Penalty comes up. that too, goes to court.
Fortunately, this (net neutrality) is only a recommendation. DoT itself has got its own understanding. They did their own study.
Coming back to the Trai issue on net neutrality, when you started off by accepting an American definition, and when America changed its mind, you never explained why you didn’t change your mind. I think you are obligated to say that when a major entity in a country that led the whole issue on net neutrality chose to go a different way, you need to afford some sense as to why you felt that the change, which now defines net neutrality, is not applicable to India if the earlier view was applicable.
Is there a way to assess the cost of regulatory compliance?
CUTS International said you must do a cost-benefit analysis whenever there is a regulatory intervention.
Mr. Sharma (Trai chairman R.S. Sharma) is very quiet on this recommendation. Globally, because of the burden on the industry and the cost imposed through regulatory exercises, there is now an increasing pressure for all regulators to go through the cost-benefit analysis in terms of what is the benefit of a particular recommendation. There is not a single paper or recommendation I have seen from Trai, even quantification or discussion, on how it is perceived as a cost or benefit. All motherhood statements say it is good for the consumer.
When you look at the American situation, why are they reversing it? They say there are existing laws. Please tell me where existing laws do not help achieve goals you want to achieve in terms of ubiquitous access to internet. Consumers have forums to complain. There are laws against monopolies and cartels.
Are you planning to approach DoT on Trai’s recommendations?
We will be writing (to them). There are issues that we have. Earlier on, when the DoT did its own study on net neutrality, they had differences in perspective. So we are hoping that the DoT will update its study and then take a call.
Should we not wait for issues like privacy and data protection to be decided? There is a whole committee being set up… the Srikrishna committee on data protection…and there is the Justice Shah committee on privacy that just released its recommendations. Should we not have waited a little longer?
Will you pitch for more exclusions from these recommendations?
The internet is far too fast-moving and innovative and regulation is invariably 2-3 years behind. You can say, look let us be sure that there are laws to deal with generic issues—consumer protection, anti-competitive practices, cartelization, monopolies, all of those things. And then let’s see if there are violations of these existing rules as opposed to carving out this new thing that only impacts a group of people called TSPs (telecommunications service providers) and ISPs (internet service providers).
The other thing is the “anti-provisions”. You won’t do this and this. That increases the compliance issue because not only do you have compliance issues, you also have enforcement issues. And when you have enforcement issues, you invariably have penal issues. If these penalties are large enough, it makes it worth my while to go to court.
Once you get into this ex-ante approach where you put all these dos and don’ts, then of course you have to get into the licence conditions, otherwise you cannot enforce.
Then, there will be penal provisions for violations. This creates a kind of adversarial thing, as you have to review, comply, report etc., and all of a sudden, if the penalty is large, then the operator says I will go to court. This gets tied up in court and the signal that goes out is that India is a tough place to do business.
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