The fines are for flouting licence conditions by denying Jio \adequate points of interconnection (PoIs) in 2016, which affected the quality of services. This comes shortly after the government unveiled a series of measures to help the debt-laden sector.
The Department of Telecommunications (DoT) has issued notices toVodafone IdeaNSE 5.78 % and BhartiAirtelNSE -0.84 % to pay ₹3,050 crore in cumulative penalties within three weeks for flouting licence conditions by denying Reliance Jio Infocomm adequate points of interconnection (PoIs) in 2016, which affected the quality of services. This comes shortly after the government unveiled a series of measures to help the debt-laden sector.
“The DoT has given the companies three weeks to pay the penalties,” a person familiar with the matter told ET. Airtel has to pay ₹1,050 crore and Vodafone Idea has to pay ₹2,000 crore.
The Telecom Regulatory Authority of India (Trai) had recommended fines of ₹1,050 crore each in 2016 on Vodafone India and Bharti Airtel for violating licence conditions over quality of service by not granting adequate PoIs to Jio in 21 circles each.
‘Frivolous and Motivated Allegations’
Idea Cellular was fined ₹950 crore for flouting rules in 19 circles. PoIs are required for voice calls to go through from one network to another – in this case, from Reliance Jio’s network to those of Bharti, Idea and Vodafone.
Vodafone and Idea merged in August, 2018. The DoT accepted the regulator’s recommendations in June 2019 but had not served the notices till now.
“We are deeply disappointed with the arbitrary and unfair demand based on Trai recommendations of 2016 relating to provisions of point of interconnect to a new operator,” an Airtel spokesperson said in a statement. “These allegations were frivolous and motivated. Bharti Airtel takes pride in maintaining high standards of compliance and has always followed the law of the land. We will challenge the demand and pursue the legal options available to us.”
Vodafone Idea did not respond to queries.
This follows the government’s mid-September announcement of wide-ranging reforms to provide relief to the debt-laden telecom sector and preserve a three-private player market. It announced a moratorium of four years on payment of government dues such as AGR and spectrum payments, among other major relaxations.
The demand notices – which adds to Vodafone Idea’s statutory dues of over ₹1.6 lakh crore – were issued on the day telecom secretary Anshu Prakash demitted office. New telecom secretary K Rajaraman assumes office today.
After a bitter public fight over grant of PoIs between Jio and incumbents Vodafone, Idea and Airtel in the lead up to the commercial launch of the Mukesh Ambani-owned telco, Trai had in October 2016 ruled that the actions of Airtel, Vodafone and Idea appeared to be aimed at “stifling competition” and were “anti-consumer” and “against public interest.” It had said that the three telcos deserved to have their licences revoked – the severest action that the authority could take – but, keeping in mind consumer inconvenience, it suggested the highest financial penalties of ₹50 crore for each circle.