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Draft Telecom Bill: Summary and Issues

DoT has recently proposed a consolidation and overhaul of the law around telecommunications in India, replacing the old existing legislations. This article summarizes the key provisions of the proposed bill and identifies issues in the proposals.

Draft Telecom Bill: Summary and Issues

I. Introduction

The Department of Telecommunications ('DoT'), under the aegis of the Ministry of Communications, released the draft Indian Telecommunication Bill, 2022 ('the Draft Bill') on 21st September 2022 and is currently accepting public comments on the same. The proposed bill has introduced some major changes in the existing telecommunications services and infrastructure regime in India, intending to update the extant regulatory framework and match it with the advancements and challenges in the telecom sector.

As per the Explanatory Note to the Draft Bill, also released by the DoT, various key themes have emerged from comments and discussions received from the public on the Consultation Paper released earlier this year, in July 2022, on the basis of which the Draft Bill has been written. These themes or needs, resulting in the Draft Bill, include a new legal framework for telecom that is future-ready and can ensure roll-out of new technologies, legal certainty around spectrum use, allocation and assignment, importance of cybersecurity, national security and public safety concerns, a distinctive insolvency framework, and rationalization of the penalty framework. The Draft Bill has been prepared after considering the relevant legislations in Australia, EU, UK, Singapore, Japan and USA.

The Draft Bill will replace three primary yet considerably outdated legislations namely, the Indian Telegraph Act, 1885, Indian Wireless Telegraphy Act, 1933, and Telegraph Wires (Unlawful) Possession Act, 1950. While it is not desirable to discuss the drawbacks of these laws in detail, the fact that even the recent law was passed more than 70 years back shows the need for the new law, particularly in light of rapid growth in the telecom sector.

II. Key provisions and issues

(1) Wide definition of ‘telecommunication services’: One of the major changes that the Draft Bill has brought in is expanding the definition of “telecommunication services” given under clause 2(21) to include over-the-top ('OTT') communication services. As a consequence of this, OTT services would also be subject to the same licensing conditions as telecom Service Providers ('TSPs').

Today, platforms like WhatsApp, Telegram, Signal, Messenger, Duo, and Google Meet are providing features such as voice calls and messaging, which is in direct competition with the TSPs. However, these platforms didn’t have to deal with infrastructure and as they were using the network infrastructure of TSPs like Airtel, Jio etc. The intent behind widening the definition of ‘telecommunication services’ is evidently to bring these service providers at par with TSPs. There are a lot of representations already being filed with the government opposing this change in law on the basis that these service providers are characteristically different from TSPs since they are mere software or app based and in turn use the telecommunications infrastructure, rather than actually providing telecommunication services.

(2) User identification and preventing spam / fraud calls: Additionally, the Draft Bill also takes into consideration the increasing incidence of spam and fraud calls. Clause 4 of the Draft Bill proposes the idea of revealing the identity of the person communicating using any form of telecommunication services that shall be available to the user receiving such communication. This would mean that unlike now where only the phone number of the person making the communication is displayed, going forward the name of the person would also be displayed. This will also be applicable for users of OTT communication services. This is similar (and rather expansive) of the provisions contained in the Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021, issued under the Information Technology Act, 2000, wherein it is provided that intermediaries should identify the persons behind communications. More specifically, first originators of the messages ought to be identified by the intermediaries. Further, the Draft Bill also provides that communications in nature of advertising and promotion can be made only with the prior consent of a subscriber.

(3) Spectrum allocation, sharing, trading, leasing, and surrender: The Draft Bill lays down a detailed route of allocation of spectrum. It prescribes that the primary route for allocation of the spectrum is the auction, and when the spectrum is to be allocated for certain functions of the government such as defense or transportation the administrative process is to be followed. It also allows the TSP to exploit its spectrum resource fully by enabling sharing, trading, leasing, surrendering, or returning unutilized spectrum. The Draft Bill also simplifies the process for restructuring, merging, or demerging.

(4) Privacy and interception: The Draft Bill, inter alia, provides that in the interest of public safety and to prevent incitement to an offence, the telecommunication network or service may be directed to intercept or detain or disclose any message to the government. Now, since the definition of telecommunications proposed in the bill includes service providers like WhatsApp etc., this provision of interception of messages would apply to them as well. Thus, it would be the responsibility of such service providers to comply with the directions of the government, decrypt the messages if so directed, and pass them over to the government. This aspect has long been under discussion and encrypted messaging and voice calls, being out the reach of government interception, have been thought of as providing the basis for miscreant communications.

(5) Shutdowns: The Draft Bill provides for suspension or shutdown of telecommunication services in the case of an emergency, or for public safety and other similar reasons. This provision ostensibly ignored the reforms recently recommended by the Supreme Court in Anuradha Bhasin v Union of India (2020) 3 SCC 637 and the Parliamentary Standing Committee on Information Technology. The Apex Court has directed to publish copies of internet shutdown orders, while the Parliamentary Standing Committee has said that the Central Government should maintain data on how many shutdowns have happened as well as separately carry out the studies on whether internet shutdowns are even effective in achieving law and order ends. However, in the Draft Bill, nothing like this finds place.

Furthermore, clause 52 of the bill tells that the Temporary Suspension of Telecom Services (Public Emergency or Public Safety) Rules, 2017, notified under the Telegraph Act, 1885 will still apply meaning that any order of internet shutdown would need to be scrutinized by a Review Committee – this process of scrutiny has already received a lot of criticism since the Committee comprises of only members from the Executive, and when the order itself has been passed by the Executive, its self-scrutiny would be against the principles of natural justice. However, the Draft Bill fails to address this issue.

Further, the Supreme Court in Anuradha Case also laid down that internet shutdown orders must satisfy the tests of both necessity and proportionality, and that the right to internet is a fundamental right. However, the Draft Bill fails to deal with the same.

(6) Regulatory Sandbox: The Draft Bill also proposes the creation of a regulatory sandbox by the Central Government. This means that there would be a framework of special terms and conditions of license, registration, authorization, or assignment that allows persons to conduct live testing of products and services in a controlled environment under the supervision of the Central Government.

(7) Reduction of regulatory powers of TRAI: The Draft Bill has also reduced the power of the Telecom Regulatory authority of India ('TRAI') which is an independent and specialized regulator for the telecom sector. For instance, now the government would no longer be required to seek recommendations from the TRAI before issuing licenses. Furthermore, the DoT will no longer be required to refer back to TRAI the recommendations for reconsideration that it does not agree with as it was earlier supposed to do. Through, this bill, the government has tilted the role of TRAI more towards being an advisor than a regulator.

(8) Offences: The Draft Bill has also proposed the categorization of offences in terms of whether they are cognizable and/or compoundable. It has also fixed the monetary cap for financial penalties; this would help in giving certainty to regulatory actions and dissuade the practice of extreme actions or crippling penalties.

(9) Other provisions:

  • The Draft Bill proposes to set up a Telecommunication Development Fund to which the payments made for telecom license grant, spectrum allocation etc. shall be credited. The Fund shall be used for promoting access and delivery of telecom services, research and development, skill development and training in telecom, pilot projects and other objectives related to telecommunications.

  • The Draft Bill prescribes that the Central Government would lay down measures for prior consent of users for receiving certain messages and the preparation of the ‘Do Not Disturb’ register for this purpose.

  • The Draft Bill provides that the Central Government may provide certification for operation of wireless equipment on a vessel or aircraft or to amateur station operators.

  • The Draft Bill mandates that to set up telecom towers or infrastructure, land owned by any public entity would be made available as soon as possible. Now, this particular provision is likely to receive much criticism and non-cooperation from state governments which have the power to administer lands within their territorial jurisdiction.

III. Conclusion

Needless to say, the Draft Bill introduced by the government is a welcome step towards the alignment of the telecom sector with the modern changes in the said sector. However, at the same time, the fact can also be not denied that there are some flaws in the bill that should necessarily be sorted out to effectively achieve the purpose behind this bill. Thus, public comments are going to play a very important role in deciding the future faith of the telecom sector.

The Draft Bill may be accessed at:

Draft Indian Telecommunication Bill, 2022
Download PDF • 747KB
Explanatory Note to the draft Indian Telecommunication Bill, 2022
Download PDF • 591KB

Authored by: Editorial Team, Metalegal Advocates. The views expressed are purely personal.

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