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India:
TRAI Pushes For Transparency With Customers
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On 18 September 2020, the Telecom Regulatory Authority of India
(TRAI) issued two directions (Directions) dealing with publication
and advertisement of tariffs by telecom service providers (TSP)
with an aim to increase transparency in tariff plans.
Background
TRAI released the Telecommunication Tariff Order (TTO) in 1999
for the first time with a view to regulate tariff of
telecommunication services throughout India. Under the TTO, tariff
for majority of telecom resources is under ‘forbearance’,
signifying that TRAI had refrained from prescribing tariffs or
ceilings in respect of such services and allowed the prices to be
dictated by market forces and competition between TSPs.
However, the TTO also enunciated that prices must be based on
regulatory principles such as transparency. This meant that all
necessary information relating to the tariff should be provided to
the customer in order to enable them to make an informed choice. To
this end, TRAI further amended the TTO in 2018 to include a
definition of ‘transparency’ to mean “the
disclosure of all relevant information of every tariff plan by the
service provider which enables the consumer to make an informed
choice“. Further, the TTO required that the disclosed
information pertaining to tariff should be inter alia
“accessible, accurate, comparable, complete, distinct and
identifiable, explicit and non-misleading, simple and
ambiguous“.
Despite the above measures, TRAI has noted that TSPs are not
adequately highlighting additional terms and conditions pertaining
to tariff plans or that such information is ambiguous and
inaccessible, where transparency measures adopted by TSPs are not
as transparent as they should be. Further, in addition to
conventional tariff plans, several TSPs also offer innovative
tariff plans such as Special Tariff Vouchers (STV), Combo Vouchers
(CV) and add on packs with insufficient information and details.
The Directions have been passed by TRAI to inter alia
address these shortcomings.
Key directions passed by TRAI
In exercise of its powers under the Telecom Regulatory Authority
of India Act, 1997, TRAI has passed the following directions:
- TSPs are required to publish details of each tariff plan
provided by the TSP for post-paid and pre-paid customers, as
applicable, within 15 days of issuance of the Directions.
Additionally, details of all tariff plans should be made available
by the TSP to its subscribers at customer care centres, points of
sale, retail outlets as well as on its website and app. An
exhaustive list of essential disclosures (e.g. rates of usage,
limits of usage, details of all cost components, inclusions and
exclusions in the plan, service parameters, validity period, etc.)
that need to be made with respect to a tariff plan has been
prescribed.TSPs are also required to publish details of each tariff offer in
the nature of STVs, CVs, add on packs, etc. within 15 days of
issuance of the Directions. Details of such tariff offers
should also be made available by the TSP to its subscribers at
customer care centres, points of sale, retail outlets as well as on
its website and app. An exhaustive list of essential disclosures
(similar to disclosures applicable in case of tariff plans) that
need to be made with respect to a tariff offer has been
prescribed. - TSPs are also required to prominently highlight any additional
terms and conditions that may be applicable to a tariff plan.
Further, a link to the specific terms and conditions should be
provided for each tariff offering. All such tariff related
information should be disseminated, including on the website and
mobile applications, within 15 days from the issuance of the
Directions.
Comment
The issuance of Directions by TRAI is certainly a step in the
right direction to bolster customer confidence and equip them with
relevant information. This will essentially enable customers to
make informed decisions, which may otherwise not be possible due to
“lack of information, misleading information or unclear or
hard to find information“. In the era of cut-
throat competition in the telecom industry, transparency in respect
of tariffs is quintessential. Such measures will also foster
healthy competition amongst TSPs, which will ultimately benefit all
stakeholders in the ecosystem.
The content of this document do not necessarily reflect the
views/position of Khaitan & Co but remain solely those of the
author(s). For any further queries or follow up please contact
Khaitan & Co at legalalerts@khaitanco.com
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