Understanding TRAI’s latest directive

The Telecom Regulatory Authority of India has issued a direction to all the broadcasters to comply with the provisions of the Telecommunication (Broadcasting and Cable) Services (Eighth) (Addressable Systems) Tariff (Second Amendment) Order, 2020 (NTO 2.0) that was notified on 1st January, 2020, to further improve the existing Telecommunication (Broadcasting and Cable) Services (Eighth) (Addressable Systems) Tariff Order, 2017 (“Principal Tariff Order”) notified by the TRAI in 2017.

The Direction appears to have been issued in the light of a major broadcaster having discontinued its low priced bouquet with effect from 01.08.2020 so that consumers subscribe to the higher priced bouquets. The TRAI in the said direction has also expressed apprehension that other broadcasters may follow the same steps thereby nullifying the very legal framework laid down for regulation of the broadcasting sector thereby resulting in total chaos.

From the direction it also appears that TRAI has received a large number of complaints asserting that the consumers are being denied the benefits of the NTO 2.0 due to the non-implementation of the same by some broadcasters. Complaints seem to have been received from certain DPOs as well, alleging that some broadcasters are extending old agreements with the DPOs whereas, are imposing new terms and conditions including prices to other DPOs. Moreover, DPOs having complied with their obligations under the NTO 2.0 are now unable to implement the remainder of the regulations due to non-performance by the broadcasters. Other concerns for the TRAI have surfaced as a vacuum has been created in the regulatory framework by the confusion in the applicable regulations resulting in the DTH operators & MSOs refusing to enter into RIOs offered by the broadcasters that are not compliant with the NTO 2.0.

The broadcasters and various stakeholders had challenged the provisions of NTO 2.0 before various High Courts, however, no interim orders have been passed. In fact, in the challenge before the Hon’ble High Court of Bombay, the High Court after hearing the matter at length for six hays had reserved its order on the interim relief on 4th March, 2020.

Even though there has been no judicial order directing a stay of the implementation of NTO 2.0, the broadcasters appear to have not only failed to implement the provisions of the NTO 2.0, but have started violating the provisions of the Principal Tariff Order, 2017 particularly in respect of reporting requirement and are furthermore disturbing the status quo by modifying the composition as well as the discontinuation of their existing bouquets that are beneficial to them but adversely affects interests of consumers, states TRAI in the Direction.

Since the High Courts are seized with the issue, the TDSAT has in a recent matter before it declined to pass any orders in respect of the implementation of the NTO 2.0 inter alia, observing that the TRAI as a regulator has powers to enforce the regulations if the High Courts do not intervene.

Though TRAI had till date not pressed for the enforcement of NTO 2.0 and had not taken any coercive actions, however, the ad-hocism that has arisen in the sector appears to have necessitated the TRAI to step up and issue the Direction notwithstanding the subject matter being sub judice before various High Courts.

The TRAI has now directed all broadcasters to report to it the name, nature, language, MRP per month of channels and MRP per month of bouquets of channels, or composition of bouquets and also amend the Reference Interconnected Offer (RIO) in compliance with the provisions of the amended regulatory framework and publish the same on their websites latest by 10th August, 2020.

Since the NTO 2.0 has been aggressively opposed by the broadcasters and other stake holders, it shall be interesting to see the how the next few days leading to 10th August, 2020 unfold.

(The author is Ritwika Nanda, Partner, Trust Legal)

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