Reliance Jio is not keen on scrapping IUC charges now that it is charging consumers


Reliance Jio, which has now started charging for voice calls to other networks, has asked regulator Trai to stop the consultation process on a new timeline for removing Interconnect Usage Charges (IUC) and enforce 'Bill and Keep' regime under the IUC regulations from January 1, 2020.

"RJIL requests you to take note of RJIL's objections with respect to the present Consultation Paper and hopes that you will abort the current exercise, which is not only against the interest of the industry, but also the consumers and the public at large," it said in a letter to Trai Secretary.

Bill and Keep represents is an approach to interconnection charging in which the networks recover their costs only from their own customers rather than from the sending network.

The incumbents - Airtel and Vodafone - oppose the BAK model, saying this is a break away from the global practice of IUC.

In a consultation paper floated last month, Trai weighed deferring the date for scrapping IUC, levied by networks handling incoming calls from rival networks. Its abolition or reduction would help operators with more outgoing traffic than incoming calls.

The new consultation paper is to see if there is a need to revise the applicable date for scrapping IUC, given the continuing imbalance in inter-operator traffic. Earlier, Trai had decided to phase it out from January 2020.

Reliance Jio's decision to charge its customers comes after the Trai floated the consultation paper to extend the deadline to make IUC charges zero with effect from January 1, 2020 citing traffic asymmetry.

"Trai must forthwith stop the consultation process and enforce the BAK regime in terms of the 2017 IUC Regulations with effect from January 1, 2020," Jio said.

The operator said Trai's action of issuing the present consultation paper is barred by the principles of promissory estoppel and principle of illegitimate expectation.

In the letter 'Objections of Reliance Jio Infocomm Limited to the Issuance of the Consultation Paper on Review of Interconnection Usage Charges' to the Trai Secretary, Jio said: "At a time when the situation is ideal to implement the Bill and Keep (BAK) regime from 01.01.2020, this retrograde step manifested in the form of the present Consultation Paper is neither warranted nor sustainable."

The letter said the consultation paper "subsidises and incentivises the TSPs who, by design and astute planning, do not want to shift to IP-based technology".

Jio said the sole reason sought to be given by Trai for the present Consultation Paper is that "still many of the calls are getting terminated on the circuit switched networks and though the imbalance in the inter-operator offnet traffic is reducing, it still exists".

In a sharp attack on Trai and the incumbents, Jio questions if it is a designed asymmetric traffic created by the incumbents and goes on to say: "Trai fails to address as to whether this was a result of certain technological difficulties, or was it designed procrastination by these TSPs to avoid the implementation of the BAK regime. The data recorded by Trai in the Consultation Paper reveals that the default on part of these TSPs is not only a designed default, but also intended to maximize collection of unfettered revenues through termination charges. The present Consultation Paper has the effect of disincentivising technological progress and incentivising designed defaulters, and this cannot be purpose of any consultation process."

Terming the step by Trai as "retrograde, against consumer interest", Jio said RJIL's network has catapulted India to among the top 10 countries in the world in terms of mobile broadband internet access from its dismal rank of 155 out of 230 countries prior to its entry.

"The present Consultation Paper seeks to stifle the growth of the industry, and this is completely against consumer and public interest. As a sequence of these misconceived actions, pro-consumer TSPs like RJIL, who have adopted the latest technologies are now required to revisit their tariffs and charge customers for voice services and such a step will be against consumer interest."

The Ambani company said Jio has made significant investments based on Trai's regulatory predictability, and in its 2017 IUC paper, it is submitted that the present Consultation Process violates RJIL's legitimate expectations, whereby TRAI had mandated that the BAK regime shall be introduced for all calls from January 1, 2020.
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