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Law Ministry On 3G ICR Agreements: DoT Can Cancel Permits, Claim Revenue

The Law Ministry has given its nod to the Department of Telecom for taking action against telcos that have been offering 3G services in service areas where they were not allotted 3G spectrum via Intra-circle roaming agreements, following which the DoT intends to direct operators such as Vodafone, Idea and Airtel to stop offering 3G services in circles where they don’t have 3G spectrum, according to a report by The Economic Times.

The report cites the Additional Solicitor General’s response to a DoT query, in which he has clarified that the DoT had the right to claim the revenue earned by companies who did not have ‘any authorisation, permission or license from the DoT’ to run 3G services based on’the doctrine of unjust enrichment’. It added that the DoT also had the mandate to cancel their permits. However, the ministry also mentioned that DoT cannot impose financial penalties on the telcos.

Note that leading telcos, Vodafone, Idea Cellular and Airtel use 3G Intra-circle roaming pacts to offer 3G services in areas where they don’t have a 3G license. The DoT and the operators have been at loggerheads on the issue, with the Telecom Disputes Settlement and Appellate Tribunal (TDSAT) delivering a split-verdict on the dispute, in July, as the two-member judge bench comprising of the chairman Justice S B Sinha and member P K Rastogi, reached different conclusions on whether these pacts could be allowed or not. While Sinha approved the telecom operators’ appeal against DoT’s directive to stop intra-circle 3G roaming stating that DoT had not followed proper process and had not provided appropriate time for telcos to respond with their views, asking DoT to restart this process and provide enough time for operators to respond to DoT’s directive,  Rastogi had dismissed the telcos’ appeal stating that operators cannot offer 3G services in the country when they only have 2G licenses.

3G Roaming Pacts: Telcos vs Indian Govt (DoT)

Vodafone had launched 3G services in Andhra Pradesh and Kerala with to an intra-circle 3G arrangement between Vodafone, Idea Cellular and Bharti Airtel and had announced in the following month, that it had signed agreements with Bharti Airtel and Idea Cellular to allow operators to offer 3G roaming services in areas where it doesn’t have licenses to operate 3G services.

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However, the DoT later announced that these arrangements were illegal since the agreements were against the telecom licenses and would lead to loss of revenue to the government. The telecom ministry had also sent notices to telcos ordering them to scrap the 3G intra-circle roaming pact following which Aircel and Tata Docomo had scrapped their agreement for providing 3G services in each other’s circles, while Vodafone, Idea Cellular and Airtel had jointly written a letter to the Prime Minister of India asking them for a refund of the spectrum auction money with interest, in case the ICR roaming arrangements were to be declared illegal. Operators also moved to TDSAT the same day, against the directive. Further, they added that they had received prior explicit written clarifications from DoT before the auction, regarding this matter. TDSAT had later restrained DoT from taking any action against the operators.

Do read our take on the 3G Intra-Circle Roaming dispute.

– Aircel & Tata Docomo Cancel 3G Intra Circle Roaming Agreement: Report
– 3G Roaming Scam Or Just Poorly Thought Out Policy?
– Idea Cellular Q2FY12 Call: To Launch Branded Android OS Phones; 3G ICR Revenues; MNP

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