Vodafone Idea loses legal challenge over TRAI PoI penalties

CommsUpdate: The Delhi High Court has dismissed a plea from Vodafone Idea challenging a penalty imposed on the cellco for allegedly denying sufficient points of interconnection (PoIs) to then-newcomer Reliance Jio Infocomm in late 2016, the Economic Times writes.

Vodafone Idea had sought the cancellation of a recommendation from the Telecom Regulatory Authority of India (TRAI) to fine incumbent cellcos INR500 million ($6 million) per circle where Jio was deemed to have been provided insufficient PoIs.

The incident pre-dated the creation of Vodafone Idea in August 2018 through the merger of Vodafone India and Idea Cellular, and both cellcos were issued penalties: INR10.5 billion for Vodafone (21 circles) and INR9.5 billion for Idea Cellular. As such, the total fine for the merged entity stands at INR20.0 billion.

Vodafone Idea says fines were arbitrary

Vodafone Idea argued that the regulator’s decision to impose the fines were arbitrary and beyond the scope of the TRAI’s powers and the terms of existing regulations and requested that the penalties be quashed. The Delhi High Court has now rejected that request.

As noted by TeleGeography’s GlobalComms Database, Jio launched commercial services in September 2016 with a promotional offers that provided customers with free services until 31 March 2017.

Jio customers initially experienced a high rate of failure for cross network calls, with Jio blaming the incumbents for withholding the provision of PoIs.

For their part, the incumbent cellcos claimed that the volume and asymmetry of calls resulting from Jio’s provision of free services would congest their networks.

TRAI sides with Jio (again)

TRAI sided with Jio and went as far as threatening the cancellation of licences for the alleged infraction.

Notably, the period saw the TRAI rule in favour of Jio through a series of judgements and decisions, leading to accusations that the regulator was deliberately favouring the newcomer.

For example, the company escaped regulatory intervention or repercussions on several counts for its disruptive ‘Welcome’ offers. In one case it faced no penalty for effectively extending the promotion beyond the legal limit on the grounds that a name change and a minor adjustment to the terms were sufficient to classify the promotion as a distinct offer.