Lok Sabha Question No. 3075 (UNSTARRED), answered on 2018-03-14
Subject: Issue of Transparency in Tariff Offers
Ministry: COMMUNICATIONS
Asked by: SHRIKANT EKNATH SHINDE, ANANDRAO  ADSUL, DHARMENDRA YADAV, Shrirang Appa Barne

## GOVERNMENT OF INDIA MINISTRY OF COMMUNICATIONS DEPARTMENT OF TELECOMMUNICATIONS

## LOK  SABHA UNSTARRED QUESTION NO. 3075 TO BE ANSWERED ON 14 th  MARCH, 2018

## ISSUE OF TRANSPARENCY IN TARIFF OFFERS

3075.  DR. SHRIKANT EKNATH SHINDE: SHRI ANANDRAO ADSUL: SHRI DHARMENDRA YADAV: SHRI SHRIRANG APPA BARNE:

Will the Minister of COMMUNICATIONS be pleased to state:

- (a) whether the Telecom Regulatory Authority of India (TRAI) has received any complaints from  consumers  highlighting  lack  of  transparency  in  Telecom  Service  Providers  (TSPs)  tariff offers  and  if  so,  the  details  thereof  including  the  number  of  such  complaints  received  during each of the last three years, TSP-wise;
- (b) the action taken/being taken by the TRAI on these complaints;
- (c) whether transparency in tariff is an issue of prime concern for the Telecom Regulatory Authority of India (TRAI) and if so, the details thereof;
- (d) the  steps  taken  by  the  TRAI  to  determine  relevant  market  based  on  relevant  product against which it receives complaints; and
- (e) whether the TRAI has fixed a penalty of Rs.50 lakh per circle for every predatory tariff plan and if so, the details of the companies fined for predatory tariff plan during the said period?

## ANSWER

## THE MINISTER OF STATE (IC) OF THE MINISTRY OF COMMUNICATIONS & MINISTER OF STATE IN THE MINISTRY OF RAILWAYS (SHRI MANOJ SINHA)

(a) & (b) It may be noted that TRAI Act, 1997 does not envisage handling of the individual consumer  complaint  by  the  Telecom  Regulatory  Authority  of  India.  However,  the  complaints received  from  consumers  in  TRAI  are  forwarded  to  the  concerned  telecom  service  providers (TSPs) for appropriate action. TSP wise details of tariff related complaints received in last three years in TRAI, which are forwarded to the TSPs is as per Annexure-I (Enclosed).

- (c) Transparency  in  tariff  is  and  has  always  been  an  issue  of  prime  concern  for  the Authority.  To  protect  the  interests  of  the  consumers  of  telecommunications  services,  the Authority has issued several directions and guidelines in order to ensure transparency in tariff offers.  It  has  been  constant  endeavor  of  the  Authority  to  give  due  importance  to  the 'transparency' which is evident from the extant regulatory provisions and action taken in the past in  this  regard.  Important  steps  taken  by  TRAI  to  enhance  transparency  in  tariff  offers  are enclosed as Annexure-II (Enclosed).

According to the latest amendment to the Telecom Tariff Order (63 rd  Amendment), 2018, notified on 16.02.2018, it has been mandated that to ensure transparency, the tariff offers of the Telecom Service Providers (TSPs) would be on the touchstone of the following criteria:

- (i) Accessible: Is the information easy to access, find and use?
- (ii) Accurate: Is it accurate, up to date and  can it be checked  for correctness?
- (iii) Comparable: Is  it  presented  in  such  a  way  by  various  providers  which allows for easy and sensible comparisons?
- (iv) Complete: Whether all required information is available?
- (v) Distinct and Identifiable: Is the tariff offers have distinct characteristics so that it is identifiable by the consumer without any ambiguity?
- (vi) Explicit  and  Non-misleading: The  tariff  offers  should  not  have  any implicit  or  hidden  charges  or  conditions.  They  should  also  correctly convey what the consumer would pay and get in terms of service.
- (vii) Simple  and  unambiguous: Is the information expressed  in  units, concepts  or  terminology  that  is  unambiguous  and  easy  to  understand? Have the tariff offers have been communicated in simple terms?

(d) The  Authority  examined  the  issue  in  detail  and  found  no  rationale  in  delineating  the market on the basis of products like voice, data and technologies like 2G, 3G or 4G due to fast changing nature of the technology and basic purpose being the transmission. It can be argued that consumers purchase services rather than a technology. Similarly, the pricing and costing policies are aligned with the services for which the license has been obtained. The Authority has considered  all  the  suggestions  of  stakeholders  and  global  best  practices  in  this  regard  and acknowledges the fast changing nature of technology, dynamic nature of telecom services and products and bundled offer of services etc. It has been decided that the relevant product market for telecom services in India for the purpose of deciding predatory pricing should be in tune with distinct  telecommunication services defined in Unified License and other Licenses granted by the  licensing  Authority  i.e.,  DOT.  Under  the  category  of  Access  Service  two  distinct  relevant product  market  (a)  wireline  access  service  and  (b)  wireless  access  service  have  been delineated as the services offered are not regarded as interchangeable or substitutable by the consumer, by reasons of characteristics of services, their intended use and price. Accordingly, the  relevant  product market for  the  instant  purpose  would  be  (i) Wireline  Access  Service,  (ii) Wireless  Access  Service,  (iii)  National  Long  Distance  Service  and  (iv)  International  Long Distance Service and any other distinct telecom service for which the licensing authority grants license  to  the  Telecom  Service  Providers.  This  approach  would  be  in  line  with  the  extant licensing regime and would be appropriate for the above mentioned purpose.

After  examination  of  the  above  in  details,  TRAI  has  notified  the  Telecom  Tariff  (63 rd Amendment) Order, 2018, notified on 16.02.2018 in which 'relevant market', 'relevant product market' and 'relevant geographic market' have been defined as under:

Clause laRelevant  market  means  the market  which  may be  determined  by  the  authority with reference to the relevant product market for Distinct Telecommunication Service and the relevant geographical market:

Clause lbRelevant product market means the market in respect of Distinct Telecommunication  service  for  which  the  licensor  grants  license  to  the  telecom  service providers.

Clause lcRelevant geographic market means a market comprising the respective license service  area for  which  the  licensor  grants  license  to  the  telecom  service  providers  to  provide Distinct Telecommunication Services.

(e) One of the provisions of the Telecommunications Tariff (63 rd  Amendment) Order, 2018 notified on 16.02.2018, in respect of Predatory Pricing is as follows:

'The Authority may, on reference from any person or suomotu ,  examine the tariffs of a SMP (Significant Market Power) to determine the existence of predatory pricing. The Authority may, after providing detailed reasons, disallow the relevant tariffs if they are found to be predatory.

In case of tariff being found predatory, the service provider shall, without prejudice to the terms and conditions of its licence, or the provisions of the Act or rules or regulations or orders made,  or  directions  issued,  thereunder,  be  liable  to  pay  by  way  of  financial  disincentive  an amount not exceeding fifty lakh rupees per tariff plan for each service area as the Authority may by order direct.

Provided that no order for payment of any 'amount by way of financial disincentive shall be made by the Authority unless the service provider has been given a reasonable opportunity of representing against the contravention of the tariff order observed by the Authority.'

The Telecommunications Tariff (63 rd   Amendment) Order, 2018 has been implemented w.e.f.  16.02.2018.  After  implementation  of  the  provision  of  predatory  pricing,  as  mentioned above, no case for financial disincentive has arisen so far.

## Tariff Related Complaints received in TRAI from last three years (1.4.15 to 28.2.18 )

| Service Provider   |   1.4.15 to 31.3.16 |   1.4.16 to 31.3.17 |   1.4.17 to 28.2.18 |
|--------------------|---------------------|---------------------|---------------------|
| MTNL               |                   7 |                   1 |                   4 |
| BSNL               |                  44 |                  13 |                  23 |
| Aircel             |                  54 |                  34 |                  24 |
| Airtel             |                 479 |                 217 |                 335 |
| HFCL               |                   4 |                   2 |                   4 |
| Idea               |                 175 |                  78 |                 160 |
| R Com              |                 117 |                 104 |                  62 |
| R Jio              |                   0 |                   3 |                  59 |
| MTS                |                  40 |                  10 |                   3 |
| TTSL               |                 142 |                  29 |                  57 |
| Uninor             |                   2 |                   2 |                   3 |
| Vodafone           |                 404 |                 146 |                 390 |
| Total              |                1468 |                 639 |                1124 |

## Important  Steps  taken  by  TRAI  to  protect  the  interests  of  consumers  and  enhance transparency in tariff offers:

1. Protection has been given against hike in tariff as per which no tariff item in a tariff plan shall be increased during six months from the date of enrolment of a consumer into that plan. Further, no such hike is permitted during the promised validity period.  In case of lifetime plans the tariff protection extends to the entire licence period of service provider.

2. With a view to remove confusion in respect of tariff plans marketed as having 'Lifetime Validity' the Authority issued regulatory guidelines vide Telecommunications Tariff Order (TTO) 43 rd  Amendment notified on 21 st  March, 2006. Any tariff plan presented, marketed or offered as having lifetime or unlimited validity shall continue to be available to the subscriber as long as the service  provider  is  permitted  to  provide  such  telecom  service  under  the  current  license  or renewed license. The service providers were told to inform the customers the current period of expiry of their license.

3. It  has  been  mandated  through  several  Directions  that  no  chargeable  value  added service shall be provided to a customer without his explicit consent.

4. Service providers shall inform customers in writing, within a week of activation of service, the  complete details  of  his  tariff  plan.  The  changes  in  any  item/aspect  of  tariff  in  the  chosen package shall also be intimated to the customers in writing vide Direction dated 29 th  June, 2005.

5. Direction  dated  1 st September,  2008,  and  48 th   Amendment  to  TTO  notified  on  1 st September, 2008 mandate several transparency measures including the following:-

(a) Tariff information to be provided in vernacular language also.

(b) Blackout  days  (customary/festival  days  on  which  free/concessional  calls/SMS  are  not available) restricted to a maximum of 5 days in a calendar year. Such days to be pre-specified and no subsequent alteration or addition is permitted.

(c) Straight tariff reductions are to be passed on to consumers without any precondition.

(d) The service providers shall not insist on recharge between periods lesser than six months in lifetime plans for remaining connected during the promised lifetime validity period.

## 6. Telecom Consumer Protection Regulation (TCPR) 2012

TRAI has issued Telecom Consumer Protection Regulation on 06.01.2012 with a view to streamline tariff offers and enhance transparency in the provision of service.  The main features of the Regulation as amended from time to time, are:

· Categorization of vouchers as - Plan vouchers, Top up vouchers, Special tariff vouchers and Combo Vouchers - with colour bands for easy identification.

- Minimum Font size for printed matter on physical vouchers   not less than 8 Pt.
- Providing usage details to pre-paid subscribers after every call/data usage.
- Itemized post usage of account shall be provided at a reasonable cost not exceeding Rs.50/-.
- Providing information to pre-paid subscribers on activation of plan/top-up/ST vouchers.

· Improved transparency in provision of Premium Rate Services by prior information about charges.

## 7. Direction on publication of Tariff plans

TRAI has issued a Direction on publication of Tariff plans on 16 th  Jan 2012.  This Direction is aimed at enhancing transparency in telecom tariff offers and facilitate the subscribers to choose plan that suit individual requirement best. Service providers are to publish all tariff plans in a service area for prepaid and postpaid subscribers in the given format in one regional and one English  newspaper  at  an  interval  not  more  than  six  months.    Full  details  are  to  be  made available at Customer care centre, PoS, website in the given format with a view to facilitate easy and transparent comparison.

## 8. Direction on preventing misleading advertisements

TRAI has issued a Direction  on  preventing misleading  advertisements on  26.03.2012. This Direction is intended to further improve transparency in telecom tariff advertisements and facilitate  the  subscribers  to  choose  plan  that  suit  individual  requirement  best.    It  has  been mandated  that  advertisements  published  by  service  providers  are  transparent  and  nonmisleading  and  unambiguous,  disclose  all  material  information  in  unambiguous  manner  and contain the website address and customer care number of the telecom access service provider.

The advertisements issued in vernacular languages should contain all the  mandatory disclosures  in  the  same  vernacular  language.    In  addition,  the  service  providers  have  to maintain  an  advertisement  register  which  must  include  a  specimen  of  every  tariff  related advertisements, and carry out internal audit to ensure that they are complying with all aspects of this Direction and to report compliance to the Authority on half yearly basis.

## 9. Review of Processing Fee

The 53 rd  Amendment to the Telecommunication Tariff Order has mandated that the Processing Fee levied on top-up vouchers shall not exceed 10% of Maximum Retail Price or three rupees, whichever  is  less.    In  order  to  ensure  that  small  value  vouchers  do  not  disappear  from  the market, the Authority through the 50 th  Amendment has mandated that service providers have to ensure availability of top-up vouchers of Rs.10/- denomination at their points of sale.

10. Guidelines on deactivation of SIMsVide TCPR (Sixth Amendment) issued on 21.02.2013,  TRAI  has  prescribed  guidelines  on  deactivation  of  SIMs.    These  guidelines include:-

- (i) The mobile connections of prepaid consumers shall not be deactivated for any period of non-usage less than 90 days;
- (ii) There shall be no deactivation if the balance in prepaid consumer account is Rs.20/- or more;

(iii) An 'Automatic Number Retention Scheme' shall be implemented for prepaid consumers on payment of reasonable charges;

(iv) A consumer whose connection is deactivated shall be given a grace period of 15 days within which he can reactivate the same number;

(v) Consumers shall be transparently communicated the terms and conditions of deactivation of SIMs due to non-usage.

(vi) A  Safe  Custody  Scheme  has  been  mandated  for  postpaid  consumes  and  during  the period of safe custody consumers need not pay monthly rental.

11. TTO 53 rd  Amendment dated 20.04.2012 has mandated every service provider to offer to the subscribers at least one prepaid and one postpaid tariff plan with pulse tariff of one second for local and national long distance calls.

12. The  ceiling  tariffs  for  national  roaming  were  last  revised  by  the  Authority  through  the Telecommunication Tariff Order (55 th  Amendment), 2013 dated 17.06.2013. After examining the comments of the stakeholders and further analysis, the Authority, through the

Telecommunication  Tariff  (60 th   Amendment)  Order,  2015  dated  09.04.2015,  has  revised  the ceiling  tariffs  for  voice  calls  and  SMS  while  on national  roaming,  which  came  into  effect from 01.05.2015.  This  amendment  brought  about  the  following  changes  in  the  tariff  regime  for national roaming service:

| Item                                             | Ceiling tariff as per TTO (55 th Amendment), 2013   | Ceiling tariff as per TTO (60 th Amendment),2015   |
|--------------------------------------------------|-----------------------------------------------------|----------------------------------------------------|
| Outgoing local voice call                        | Re.1.00 per minute                                  | Re.0.80 per minute                                 |
| Outgoing long distance (inter-circle) voice call | Re.1.50 per minute                                  | Re.1.15 per minute                                 |
| Incoming voice call                              | Re.0.75 per minute                                  | Re.0.45 per minute                                 |
| Outgoing local SMS                               | Rs.1.00 per SMS                                     | Rs.0.25 per SMS                                    |
| Outgoing long distance (inter circle) SMS        | Re.1.50 per SMS                                     | Re.0.38 per SMS                                    |

13. TRAI  has  decided  to  put  in  place  a  mechanism  to  provide  relief  to  consumers  by mandating the following to every originating service providing Mobile Services for each call drop within its network through the 9 th Amendment  to  the  Telecom Consumers  Protection Regulations, 2012 dated 16.10.2015 w.e.f. 01.01.2016.

## (a) Credit the account of the calling consumer by one rupee

However, such credit in the account of the calling consumer shall be limited to three dropped calls in a day (00:00 hours to 23.59 hours).

(b) Send a message through SMS/USSD to the calling consumer within four hours of the occurrence of call drop and the details of amount credited in his account.

(c) In case of postpaid consumers provide the details of the credit in the next bill.

## 14. Ensuring Quality of Service

(i) TRAI has been monitoring quality of service provided by Service Providers against the benchmarks laid down by TRAI for the various quality of service parameters through Quality of Service  Regulations  issued  from  time  to  time,  through  quarterly  Performance  Monitoring Reports (PMRs) submitted by service providers. TRAI also undertakes objective assessment of the Quality of Service of Basic, Cellular and Broadband Services through independent agencies. A customer satisfaction survey is also conducted quarterly through these agencies.  The results of these audit and survey are being widely published for public/Stakeholders knowledge.  TRAI has  been  following  up  with  the  Service  Providers  for  addressing  deficiencies  in  meeting  the Quality of Service benchmarks.

(ii) To  further  strengthen  the  quality  of  standards  TRAI  had  issued  'The  Standards  of Quality  of  Service  of  Basic  Telephone  Service  (Wireline)  and  Cellular  Mobile  Telephone Services (Second Amendment)  Regulation,  2012 on 8th November  2012  for financial disincentives  on  those  service  providers  who  fail  to  meet  the  prescribed  Quality  of  Service (QoS)  benchmarks  for  Basic  Telephone  Service  (Wireline)  and  Cellular  Mobile  Telephone Service and The Quality of Service of Broadband Service (Amendment) Regulations, 2012, on 24th  December  2012  for  financial  disincentive  on  Broadband  Service  operators  for  noncompliance with the benchmark for the Quality of Service Parameters.

(iii) In  order  to  protect  the  interest  of  consumers  relating  to metering  and  billing TRAI  has issued the Quality of Service (Code of Practice for Metering and Billing Accuracy) Regulations, 2006,  which  has  mandated  yearly  audit  of  the  metering  and  billing  system  of  the  service providers through qualified empanelled auditors.  The service providers are required to submit an audit report duly certified from the empanelled auditors by 30th June of every year.   The

service  providers  are  also  required  to  file  with  TRAI  by  30th  September  of  every  year  action taken report on the deficiencies pointed out in the audit reports by the auditors.

(iv) To address the problem of Unsolicited Commercial Communications (UCC) effectively, TRAI had issued The Telecom Commercial Communications Customer Preference Regulations, 2010  on  1st  December  2010.  In  order  to  further  strengthen  the  regulatory  framework  and  to address various implementation issues, several amendments to the regulations and directions have been issued by TRAI, from time to time.

15. The  framework  for  redressal  of  grievances  of  telecom  consumers  was  reviewed  to improve  the  effectiveness  of  complaints  redressal  for  the  telecom  consumer  by  the  service provider. TRAI had notified the Telecom Consumers Complaint Redressal Regulation 2012 on 5th January 2012.  These regulations provide for Establishment of a Complaint Centre with a toll-free  'Consumer  Care  Number',  two-tier  complaint  redressal  mechanism,  registering  of  by giving a unique docket number, a two member Advisory Committee in each of the service areas by the service provider comprising of one member from consumer organization registered with TRAI,  publishing  of  Citizen's  Charter  and  setting  up  of  a  Web  based  complaint  monitoring system etc.

16. TRAI  has  issued  The  Telecommunication  Consumers  Education  and  Protection  Fund Regulations, 2007 on 15th June 2007, to enable the service providers to transfer unrefunded money  of  customers  lying  with  them  to  Telecommunication  Consumers  Education  and Protection  Fund  (TCEPF).  The  income  received  from  the  fund  is  utilised  to  undertake programmes to educate consumers, to conduct studies in the field of telecommunications and holding  seminars,  workshops  etc  on  the  subject  of  consumer  welfare  and  for  educating consumers.

17.TRAI has been registering consumer organizations for having an interface with the telecom consumers through regular interaction with these consumer organizations. In this regard TRAI has issued the 'Registration of Consumer Organizations Regulations' on 21st February 2013, for strengthening the framework for interaction with the consumer organizations.

***********