Reliance Jio questions legality of Trai's IUC paper, invokes Article 14

Topics Reliance Jio

Reliance Jio has questioned the legality and credibility of the Telecom Regulatory Authority of India's (Trai's) consultation paper on deferment of inter-connect user charges (IUC) regime, saying it is not only bad in law and against consumer interest but also violates Article 14 and 19 (1) (g) of the Constitution.

 
It has argued that the present consultation process violates the principles of regulatory predictability (as Trai had announced in 2017 that IUC regime will be over from January 1, 2019 and had defended it in courts) and Jio's legitimate expectation. 

It says Trai is barred by the principles of promissory estoppel from embarking upon such an exercise. It also alleges that the move will impact the credibility of the regulator as well as investor confidence.  The direct challenge against Trai is based on a letter sent by the company in its response to the consultation paper on October 18.

The letter blames the regulator for aiding and abetting sabotage of the prime minister's Digital India programme by protecting and perpetuating the vested interests of certain incumbents who want their large body of 2G customers (476 million) to forever remain digitally disempowered and deprived of the fruits of the digital revolution.

Jio has also raised questions about the regulator's pre-determined mind by saying that it has intentionally and erroneously avoided the need to discuss and determine the revised value of IUC and is seeking to limit the consultation paper on deferment of the IUC regime. 

According to Jio, had they recalculated the termination charges it would be less than 1 paisa per minute at this stage, a very small residual value, fully justifying the end of the IUC regime. This is because 4G subscribers have grown rapidly and now constitute for more than 45 per cent of the total wireless subscriber base and in addition the total off net calls has increased to 55 per cent over the off-net minutes in Sept 2018, as a result value of IUC would be much lower than 6 paisa.

It also alleges that the consultation paper has been issued not to address traffic asymmetry but the financial stress of one or two operators at the cost of the interest of subscribers and the telecom sector. Rubbishing claims by incumbent operators that they have a pan-Indian 4G network, Jio in its submission has said that Airtel has only 18 per cent of its voice traffic on 4G while Vodafone Idea has only 5 per cent on IP. 


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