The Telecom Regulatory Authority of India (TRAI) Act 1997 was enacted to sustain and protect customers’ interest in telecom services.
The Parliament enacted this Act to regulate India’s telecom services and tariffs Scheme. Prior to the TRAI Act, the Central Government overlooked the regulation of telecom services and tariffs. The Act established regulatory bodies, which include TRAI and the Telecom Dispute Settlement Appellate Tribunal (TDSAT).
Table of Contents
Overview of the TRAI Act
The Central Government aimed to create a non-statutory regulatory body through an amendment to the earlier Indian Telegraph Act of 1985. Such a body regulates Telecom services and companies throughout the country. However, several members of Parliament disagreed, stating that there ought to be a statutory telecom regulator with legal powers vested in it. Therefore, the government’s idea of creating a non-statutory body was declined.
In 1997, the President passed an Ordinance to create TRAI. The Parliament then officially approved this order by introducing a law named the TRAI Act. In 2000, the TRAI Act was amended, and specific changes were made to ensure the act remained relevant with the emergence of the Internet.
Amendment of the TRAI Act
Before the amendment, the TRAI was a regulatory body and performed dispute-resolution functions. The amendment constituted the Telecom Disputes Settlement and Appellate Tribunal to settle disputes. The amendment further decided whether or not the decision of the TRAI is binding on the Central Government.
Independent Telecom Regulatory Authority
The Supreme Court, while upholding the constitutionality of the National Telecom Policy, 1994, mentioned the necessity of an independent telecom regulatory body. National Telecom Policy, 1994, allowed private participation in the telecommunication sector. Per this policy change, the Supreme Court also emphasised the necessity of an independent statutory authority in an ambitious telecom market.
Government Control Over TRAI
The provisions of the Act contradict the decision by the Apex Court. TRAI is not a fully independent body; the Government partially controls it.
Section 25 of the Act states that the government can make rules that are binding on the TRAI. The central Government also funds TRAI, and under Section 35, the Central Government has the power to make rules to be binding on TRAI.
Scheme of the Act
The scheme of the Act is that it contains the following six chapters:
Chapter 1: Applicability, the critical concept, and definitions used in the Act
Chapter 2: Provisions regarding the Constitution of TRAI
Chapter 3: Powers and Functions of TRAI
Chapter 4: Establishment of Appellate Tribunal
Chapter 5: Finance, accounts, and audit of the TRAI and TDSAT
Chapter 6: Miscellaneous provisions that are required for the smooth functioning of TRAI and TDSAT
What is the TRAI?
TRAI is an independent and impartial regulatory body that takes responsibility for the telecommunications industry in India.
The primary purpose of these two tribunals (TRAI and TDSAT) is as follows:
- To check on the telecommunication services,
- Receive disputes on these matters,
- Adjudicate such disputes,
- Make orders,
- Receive appeals, dispose of appeals, and
- To protect the interest of the service providers as well as consumers.
Moreover, TRAI aims to promote and ensure an orderly growth of the telecom sector. TRAI has been discussed under Chapters 2 and 3 of the Act.
Objective of TRAI
The objective of TRAI is as follows:
- Growth of telecommunication:
- TRAI works to create and nurture the conditions for developing communication in India.
- TRAI promotes the growth of broadband services across India, ensuring access to high-speed internet services for all citizens nationwide.
- TRAI promotes healthy competition within the telecommunications sector to benefit consumers.
- TRAI ensures that telecom service providers operate fairly and intervene if anti-competitive practices are identified.
- The authority encourages technological innovation and advancement within the telecommunications industry.
- TRAI helps to create an environment that triggers research and development, leading to the innovation of new and improved communication technologies.
- Regulates telecom services:
- TRAI regulates the telecom services on tariffs that the Central Government dealt with before this Act.
- The authority sets good quality of service standards for telecom service providers to ensure that consumers receive reliable, satisfactory and timely services. This includes call drop rates, network availability, and data speed.
- TRAI plays a significant role in formulating policies and regulations related to the telecom sector.
- TRAI provides recommendations to the government on various issues, such as licensing frameworks, spectrum pricing, and market entry norms.
Provides fair and transparent policy environment:
- TRAI provides fair and transparent dealing with the policies, thereby maintaining fair competition. This involves addressing issues related to call quality, billing transparency, customer grievances, and ensuring consumers receive quality services.
- TRAI ensures that all decisions, regulations, and policies related to the telecom sector are transparent and communicated to the consumers, including service providers, consumers, and the general public.
- This transparency maintains accountability and clarity in the regulatory process to defend and uphold the interests of the users.
Composition of TRAI
Members (Section 4)
The TRAI shall consist of one Chairperson, two full-time and two part-time members appointed by the Government of India. The Central Government will appoint all the members from among the persons with exceptional knowledge and professional experience in telecommunication, accountancy, law, management, industry, finance, or consumer affairs.
The TRAI may also appoint officers to perform the functions under this Act; such employees and officers are divided into nine divisions:
- Mobile network division
- Fixed network division
- Converged network division
- Quality of Service division
- Broadcast and cable services division
- Economic division
- Financial analysis, internal finance, and accounts division
- Legal division, and
- Administration and personnel division.
Tenure (Section 5)
All members, including the Chairperson, will hold the office for 3 years from the date they enter the office or until they reach the age of 65, whichever is earlier.
Role of the Chairperson
The chairperson will have the General power of superintendence and preside over the TRAI meeting.
The Central Government may, at its discretion, appoint a Vice-Chairperson of TRAI from among one of the members of the Authority to exercise and discharge the powers and functions of the Chairperson in their absence.
Criteria for removal of members
The Central Government may remove the members and the Chairperson on the following grounds:
- If the members are adjudged to be insolvent by the appropriate court.
- They are convicted of any offence involving moral turpitude per the Central Government.
- If he/she has become incapable and unfit for holding the post as a member of TRAI.
- If he/she is enthralled in any paid work other than the Authority’s duties, which is against the public interest.
- He cannot make proper decisions as a member/Chairperson due to unsoundness of mind.
The Chairperson will have the power to schedule meetings, and he/she shall preside over the meeting. In his/her absence, the vice-chairperson will preside over the meeting. If both the Chairperson and vice-chairperson are absent, then any other person may be chosen to head over the meeting.
Decisions in any meeting will be finalised based on the majority member’s decision. In case there is an equally conflicting decision, then the Chairperson/any other presiding member will give a casting vote.
Functions of TRAI (Section 11)
The following are the functions of TRAI:
- Make recommendations: One of the essential functions of the TRAI is to scrutinise the matter and make recommendations for them. TRAI can make recommendations on the following issues:
- Introduction of any new telecom service provider.
- Revocation of the licence of any service provider for non-compliance with the terms and conditions of the licence.
- Take steps to ameliorate competition among other service providers and foster efficiency in telecommunication services to help its growth.
- Suggest any technological improvement in the services provided by any service provider.
- Furnish measures for developing telecommunication technology and any other matter relatable to the telecommunication industry.
- Discharge of the functions: The TRAI has the following responsibilities to discharge, such as:
- Ensure that the service providers relent with the terms and conditions of the licence.
- Ensure the technical compatibility of different service providers and a good interconnection between them.
- Lay down the quality standards for each service provider and direct them to follow such standards.
- Make notifications on specific time intervals regarding the cost at which the telecom services will be provided to the consumers under the TRAI Act, 1997.
- Lay down and ensure the period for providing local and long-distance telecommunication circuits between different service providers.
- Make recommendations to the Central Government: The third responsibility of the TRAI is to make specific recommendations to the Central Government, although such recommendations are not binding upon the Central Government.
- The Central Government will consult with the TRAI concerning the need and timing of new service providers and the terms and conditions of the licence to be granted to the service provider. TRAI has a duty to forward its recommendation to the Central Government within 60 days from the date of such request of the Central Government.
- Suppose the Central Government disavows to accept the recommendation, then it may send it back to the TRAI to make modifications and direct the Authority to resend it after reconsideration.
- TRAI shall make reconsiderations within 15 days from the receipt of the reference from the Central Government.
- It also recommends the Central Government to make newer technologies and innovations in the telecom sectors.
- Protect the interest of the consumers: One of the significant responsibilities of TRAI is to protect the interest of the consumers in the best possible ways.
- TRAI shall work towards dealing with consumer complaints and ensure quality services.
- Levy fees and other charges may be determined by regulations.
What are the powers of TRAI?
TRAI has similar powers to a civil court when dealing with a civil case. The following are the powers vested in the TRAI by the TRAI Act:
- Requisitioning of information (Section 12): The TRAI can call for the service provider and ask them to furnish any information in writing or explain anything about its affairs. It may require any information from the service providers, either suo moto or upon an application made by any applicant.
- Appoint members for inquiry and investigation: The TRAI has the power to inquire into any matter relating to the service provided for disposing of any dispute or query put up by the consumers. It may direct some other person to conduct the inquiry as well.
- Conduct research and analysis: TRAI can conduct research and analysis on telecom industry trends, technological advancements, and consumer behaviour. This helps in shaping effective regulatory strategies and measures.
- Order for inspection of any documents or accounts: The TRAI may either direct any of its employees or appoint some other employees to inspect the records and statements of any service provider necessary for keeping track of the work of the telecom provider.
- Make recommendations and issue directions to the service provider (Section 13): TRAI may give directives and recommendations to the service providers on how to properly function in the public’s interest and make policies for them, coming up with different ideas and innovations.
- Make notifications in the Official Gazette: TRAI also has the power to make notifications in the official gazette of the rates at which telecommunication services are being provided within and outside India. The Authority shall ensure transparency while exercising its powers and discharging its functions.
What is Telecom Disputes Settlement and Appellate Tribunal?
In 2000, the Act was amended to introduce the Telecom Disputes Settlement and Appellate Tribunal. Being a tribunal, its primary function is to adjudicate disputes in the functioning of TRAI.
Section 14A of the Act deals with the tribunal, its objective, eligibility, terms of office, removal, etc. TDSAT has been defined under chapters IV and V of the Act.
Purpose of Establishing the Tribunal
Section 14 of the Act provides for the TDSAT’s objective, which includes the following:
- Adjudicating disputes between:
- Licensor and licensee
- Two or more service providers
- Service providers and a group of consumers
- To resolve disputes and receive appeals against the issues, directions, and orders of the TRAI.
Jurisdiction and Powers of TDSAT
Section 16 of the act states that the Tribunal shall have the same powers as the civil court has while adjudicating a case, such as:
- Call for the attendance of any person and examining him on oath,
- Ask for the discovery and production of documents,
- Take evidence on affidavits,
- Requisitioning any public document copies from any public office,
- Issuing commissions for the examining witnesses or documents,
- Reviewing its decisions,
- Dismiss an application for default or decide it ex parte,
- And any other matter which may be prescribed.
The tribunal has the power to regulate its own rules of procedure.
The TRAI Act of 1997 details guidelines to telecom providers for providing services. Because of the provisions of the Act, consumers have several choices of telecom operators. Furthermore, the Act also provides a way for redressal of grievances. The Act established two tribunals (TRAI and TDSAT), which work as a regulatory body for dealing with all the telecom services concerns, thereby eliminating issues of the telecom industry. The TRAI Act and its subsequent amendment has filled necessary gaps, and set the telecom industry on a robust path to progress. With the emergence of the digital age, the TRAI Act is even more relevant for ushering India into an era of digital dominance.
FAQs on TRAI Act
What tribunal bodies has the TRAI Act laid out?
The Act is about the Telecom Regulatory Authority of India and the Telecom Disputes Settlement and Appellate Tribunal, two tribunals dealing with the telecommunication sector of India.
What does TRAI do?
The TRAI is a statutory body established under Section 3 of the TRAI Act. TRAI sets rules and guidelines for telecom companies, ensures fair competition between service providers, protects consumers' interests, and promotes technological growth in the telecom industry.
Is TRAI an independent body free from government control?
TRAI is not entirely independent. Although the body has some autonomy, the government can issue binding directions, fund TRAI, and enact rules that TRAI must follow, as per Sections 25 and 35 of the TRAI Act.
Why was TRAI established?
TRAI was established to bring transparency and efficiency to the telecom sector. The TRAI aims to ensure quality services, prevent anti-competitive practices, and protect consumer rights.
Can TRAI make new rules on its own?
TRAI can propose new rules and regulations, but they need prior approval by the government. The government has the power to make these rules binding on TRAI.
What changes were introduced after the TRAI Amendment Act of 2000?
The amendment act mainly introduced two bodies, the Telecom Regulatory Authority of India and the Telecom Disputes Settlement and Appellate Tribunal. TRAI also improvised the telecom services for the consumers by introducing a few more innovations and research.
What kind of recommendations does TRAI provide?
TRAI provides recommendations to the central government on matters related to telecommunications, such as policies, licensing conditions, and pricing of services.