Telcos stare at penalties of ₹50 cr per violation

Kolkata: Bharti Airtel, Reliance Jio Infocomm and Vodafone Idea are staring at potential penalties of about Rs 50 crore per violation for failing to meet their minimum network rollout obligations amid the nationwide lockdown as the telecom department has not extended the compliance timelines beyond May 31.

The telcos have asked the Department of Telecommunications for a six-to-nine- month extension to complete their rollout targets. The compliance timelines are linked to the spectrum band assigned to them and the date of allocation.

The operators said network equipment imports have been severely hit by global lockdowns imposed after the Covid-19 outbreak. Besides, there have been difficulties in completing tower site acquisitions, drive tests and securing multiple approvals from state authorities and municipal bodies.

“Delays in import of network equipment, which are stuck at various ports across the globe, have resulted in critical delays in planned rollout and deployments,” Rajan Mathews, director general of the Cellular Operators Association of India, said in a letter to the DoT, a copy of which was reviewed by ET.

The bulk of the network equipment is imported from Ericsson, Nokia, Samsung, Huawei and ZTE.

Mathews, in his letter, also pointed out that meeting the network rollout compliance timelines is a big challenge “due to strict restrictions imposed by the state governments and various municipal authorities.”

“It would be unfair if the telecom service providers are to suffer from any of these penalties for a situation that can at best be described as force majeure,” Mathews wrote.

“The penalty exposure for a telco is around a hefty Rs 50 crore per non-compliance towards minimum rollout obligation targets, and the dates for the submissions are coming up in June,” a senior industry executive aware of the matter said.

The COAI urged DoT to extend the deadlines by six to nine months so that relief is afforded for forthcoming compliance timelines. The COAI represents Airtel, Jio and Vodafone Idea.

At press time, Airtel, Jio and Vodafone Idea did not reply to ET’s queries.

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