Trai suggestion inconsistent, legally untenable: Reliance Jio

Telecom regulator has recommended increasing annual fee for Broadband Wireless Access spectrum, used for 4G services, to 3%

Raising issues over telecom regulator Trai's suggestions on spectrum charges, Reliance Jio Infocomm has said they will make the third round of auction inconsistent and legally untenable.

The Mukesh Ambani-led firm has also alleged that Trai recommendations favour incumbent telecom operators.

Trai has recommended increasing annual fee for Broadband Wireless Access spectrum, used for 4G services, from 1% to 3% which will put burden on RJIL as it is only player to have pan-India rights for these airwaves.

"Trai has suo-motu recommended that SUC rate for BWA spectrum should also be fixed at 3%... It is to mention that this issue was neither referred by DoT nor raised in the consultation paper. Also, it was not discussed during the open house discussions," RJIL said in a letter to the Department of Telecom.

The company said this recommendation is "arbitrary, inconsistent, out of context" and contrary to rules published in Notice Inviting Application (NIA), under which RJIL, formerly Infotel Broadband, purchased pan-India spectrum.

It said NIA terms are legally binding on both the government as well as the bidders and Trai too has held same view in the past.

"This retrospective change is, therefore, legally untenable, self contradictory, without any justifiable reason and benefits only a section of telecom industry by restricting competition," RJIL alleged.

It further said that Trai's reference to NIA document for auction of 2G spectrum in November 2012 and March 2013 to make the changes is not valid.

Trai's mentioning that "NIA clearly qualifies that the SUC rates will be as declared by government from time to time" is "factually incorrect and misleading in the context of NIA issued for auction of BWA spectrum in 2010", RJIL said.

The recommendation of Telecom Regulatory Authority of India has favoured incumbent service providers by suggesting reduction in annual fee charged by government for spectrum usage (SUC) from 3-8% to flat rate of 3% from April 1, 2014, it said.

"This recommendation is again in violation of the contractual obligations and the terms and conditions of allocation of spectrum to these operators and extends undue benefit to a few incumbent operators, besides overlooking the huge revenue loss of the exchequer," RJIL alleged.

The company has asked DoT to reject Trai's recommendation to increasing SUC on BWA spectrum as it had been given "without any consultation with the stake holders" and "is arbitrary, inconsistent and contrary to the provision of NIA dates February 25, 2010...Adversely affects RJIL alone which is the only operator having pan-India BWA spectrum."