Lok Sabha Question No. 3647 (UNSTARRED), answered on 2019-01-02
Subject: Transparency in Tariff
Ministry: COMMUNICATIONS
Asked by: PRITAM GOPINATH MUNDE, KUNWAR PUSHPENDRA SINGH CHANDEL, VINAYAK BHAURAO RAUT, SHIVAJI ADHALRAO PATIL, SHRIKANT EKNATH SHINDE, Shrirang Appa Barne

## GOVERNMENT OF INDIA MINISTRY OF COMMUNICATIONS DEPARTMENT OF TELECOMMUNICATIONS

## LOK  SABHA UNSTARRED QUESTION NO.3647 TO BE ANSWERED ON 2 ND  JANUARY, 2019

## TRANSPARENCY IN TARIFF

3647.   DR. PRITAM GOPINATH MUNDE:

SHRI KUNWAR PUSHPENDRA SINGH CHANDEL: SHRI VINAYAK BHAURAO RAUT: SHRI ADHALRAO PATIL SHIVAJIRAO: DR. SHRIKANT EKNATH SHINDE: SHRI SHRIRANG APPA BARNE:

Will the Minister of COMMUNICATIONS be pleased to state:

(a) whether the Government has taken note of the lack of transparency in tariff of various Telecom  Service  Providers  (TSPs)  and  if  so,  the  details  thereof  and  the  reaction  of  the Government thereto;

- (b) whether the Government has received complaints from consumers pertaining to lack of transparency in tariff offered by TSPs and if so, the details thereof including the number of such complaints received during each of the last three years and the current year, State/UT-wise and the action taken by the Government in this regard;

(c) the steps taken by TRAI to determine relevant market based on relevant product against which it receives a complaint; and

(d) whether the TRAI has fixed any penalty for predatory tariff plans by various TSPs and if so,  the  details  thereof  along  with  the  details  of  TSPs  fined  for  such  pricing  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) Transparency  in  tariff  is  and  has  always  been  an  issue  of  prime  concern  for  the Government. To protect the interests of the consumers of telecommunications services, TRAI has issued several tariff orders, directions and guidelines in order to ensure transparency in tariff offers from time-to-time. It has been the constant endeavour of the Government 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

However, despite these measures to ensure transparency in tariff, the TRAI has been receiving complaints from consumers and consumer organizations highlighting, inter-alia , lack of transparency in the tariff offer of telecom service providers. In the recent past, the TRAI has again reviewed the transparency measures and undertook a consultation process on issues, inter-alia , including  transparency in tariff offers. After the consultation process, the Telecommunications Tariff (63 rd Amendment) Order, 2018 dated 16.02.2018 was notified by TRAI.

(b) TRAI Act, 1997 does not envisage handling of individual consumer complaints 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. Total number of consumer complaints pertaining to telecom tariffs received in TRAI during the last three calendar years and current year is as appended below:

| Year 2015   | 1666                    |
|-------------|-------------------------|
| Year 2016   | 914                     |
| Year 2017   | 1055                    |
| Year 2018   | 1316 (up to 20.12.2018) |

(c) TRAI has notified the Telecom Tariff (63 rd Amendment)Order, 2018 on 16.02.2018 in which 'relevant market', 'relevant product market' and 'relevant geographic market' have been defined under clause 1a, 1b, 1c respectively as under: -

Clause la-   Relevant 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  lb  -      Relevant  product  market  means  the  market  in  respect  of  Distinct Telecommunication  service  for  which  the  licensor  grants  license  to  the  telecom service providers;

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

(d) 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 suo motu , 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 Telecommunication Tariff (63 rd Amendment) Order, 2018 dated 16.02.2018 was challenged in the Telecom Dispute Settlement and Appellate Tribunal (TDSAT) by some of the Telecom Service Providers.  The Hon'ble TDSAT vide its judgment dated 13 th December, 2018,  has  set  aside  the  'Telecommunication  Tariff  (63 rd Amendment)  Order,  2018  dated 16.02.2018,  so  far  as  it  changes  the  concept  of  SMP(Significant  Market  Power),  nonpredation and the related provisions and ordered that these provisions shall be reconsidered by the Authority at the earliest, preferably within six months.

However, TRAI has filed an appeal before Hon'ble Supreme Court against the order of Hon'ble TDSAT dated 13 th December, 2018. The appeal is yet to be listed.

Important steps taken by TRAI regarding transparency in tariff offers:-

1. 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.

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

3. 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.

4. 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.

## 5. 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.

## 6. 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 center, PoS, website in the given format with a view to facilitate easy and transparent comparison.

## 7. 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  non-misleading  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.

## 8. Segmented Tariff Offers:

The  segmented  offers  which  have  to  be  necessarily  transparent  and  nonarbitrary, either for retention or acquisition  of  new  consumers,  are  to  be transparently filed with the Authority in accordance with the reporting requirement. All such segmented tariffs are to be publicly displayed, inter-alia, on the website of  the  telecom  service  providers,  for  transparent  and  complete  disclosure  to consumers,  without  any  discrimination.  The  Authority  has  already  reiterated aforesaid regulatory requirement vide its direction to TSPs dated 25 th May, 2017.

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