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TRAI barred from penalising Vodafone for segmented pricing


The Madras High Court has barred the Telecom Regulatory Authority of India (TRAI) from taking penal action against Vodafone India and stayed the regulator’s order asking the telco to put all tariff plans on its website.

TRAI wanted Vodafone to display plans that were offered to individual customers in order to retain them in the network. The next hearing of the case is scheduled on April 13. The court has given TRAI time till March 28 to file counter-affidavits and till April 6 to file rejoinders, reported the Economic Times.

This interim order effectively allows Vodafone and possibly other telcos to offer specific plans to certain subscribers in order to retain them, without similar offerings for other customers. Such a practice was ruled out recently when the TRAI introduced new regulations on predatory pricing. The new tariff rules were challenged by Vodafone in the Madras High Court.

Disputed new rules

Just recently, TRAI also issued a notice to Airtel for not complying with its tariff reporting requirements for not informing about segmented tariffs offered to consumers to retain them. While the two cases remain separate, Madras HC’s order may benefit Airtel.

Separately from Vodafone, Bharti Airtel and Idea Cellular approached the Telecom Disputes Settlement and Appellate Tribunal (TDSAT) for a stay on the new tariff order. While the tribunal did not grant a stay on the rules, it gave TRAI three weeks to file its comments on why the new tariff order should not be stayed.

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The rules changed the method for identifying what was a predatory offer and gave a different the definition of significant market power (SMP)—allowing pricing flexibility only to operators with less than 30% subscriber or revenue share. The previous definition also considered traffic volume and network capacity as factors.

Many telecom service providers questioned the new rules, suggesting they were discriminatory. Industry body Cellular Operators Association of India (COAI) said that the new rules are favouring one player, hinting at Reliance Jio. It said such changes will place older operators at a disadvantage and stop them from responding to “what may be actual predatory tariff plans”.

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