The Hindu Business Line : TRAI wants to be heard on licence fees for ISPs

IN what could become the next big controversy in communications sector, the Telecom Regulatory Authority of India (TRAI) has asked the Department of Telecom (DoT) to seek its recommendations on the policy decision to impose entry fee and licence fee on Internet Service Providers. This is the first time that the telecom regulator has made such a request after the DoT has already announced its decision.

In a letter written to Mr Nripendra Misra, Secretary, DoT, the telecom regulator has said that the Government should have in the first place sought the views of TRAI since it involved creation of a new category of licence called ISPs with Virtual Private Network.

"Since TRAI's recommendations are required for issuing the terms of a licence, it is logical that they should also be obtained at the time of modification of a licence earlier granted. I would request you to refer the issue to TRAI for opinion before finalising the Government decision in this matter," said the letter by its Chairman, Mr Pradip Baijal.

The telecom regulator has said that the ISP with VPN licence is a new licence for the service provider, especially since this will be distinct from the current ISP licence. The DoT had announced its decision last month to impose a licence fee of 8 per cent of the annual revenues on ISPs apart from an entry fee ranging between Rs 1 crore and Rs 10 crore. The department had not taken the recommendations of the telecom regulator before announcing the decision, which irked not only the TRAI but also the ISPs. DoT on its part said that it was not required to seek the telecom regulator's recommendations, since it was a decision which sought to expand the scope of the existing ISP licence. TRAI had earlier sent a letter to DoT suggesting an entry fee of Rs 25 lakh.

Meanwhile, the ISPs are chalking out their strategy to challenge the DoT decision which includes legal recourse. "We will await the final guidelines of the policy from DoT before finalising our next move," said Mr Amitabh Singhal, President, Internet Service Providers Association.

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