Industry groups challenge regulator on call drop compensation

11 Dec 2015

India’s cellcos have challenged the authority of the Telecom Regulatory Authority of India (TRAI) over its October decision forcing operators to compensate users for call drops (effective from 1 January 2016), claiming that the regulator has over-stepped its powers. The Business Standard writes that industry lobby groups the Cellular Operators Association of India (COAI) and the Association of Unified Telecom Service Providers of India (AUSPI) have petitioned the Delhi High Court for a stay on the order on the basis that the TRAI does not have the power to grant compensation to end users. ‘The grant of compensation requires an adjudication to establish a breach and then determine liability of the party responsible for such a breach. TRAI does not have the power to adjudicate under the TRAI Act and therefore, the decision to grant compensation is without authority of law, without jurisdiction and is illegal,’ the COAI in its statement.

As previously reported by CommsUpdate, in October this year the TRAI introduced new rules requiring operators to pay INR1 (USD0.015) in compensation to mobile customers for each call that is dropped up to a total of INR3 per customer per day. The measures are intended to encourage cellcos to invest in infrastructure, as subscriber growth has outstripped the capabilities of operators’ networks, leading to a deterioration of service quality. According to operators, the compensation will cost the industry a crippling INR540 billion per year, although the TRAI claims the figure will not be more than INR2 billion per quarter, or INR8 billion annually.