Delhi HC stays government order to end 3G roaming pacts
Telecom operators heaved a big sigh of relief as the Delhi High Court granted a stay on the government directive that sought telcos to stop their 3G roaming pacts, which allowed them to offer the third generation mobile data service outside their licenced zones.
The court in its stay order asked the telecom department to avoid taking any ‘coercive’ measures against the service providers. “Department of Telecommunication (DoT) will not take any coercive action against the petitioner which will respond to the show-cause notice within 60 days,” Justice Rajiv Shakdher is quoted as saying.
Earlier, Bharti Airtel had moved the Delhi HC against the DoT’s show-cause notices. The DoT had asked the leading telecom companies to stop their 3G roaming pact with immediate effect. Read our previous coverage here. Bharti Airtel in its petition had said that the show-cause notice could have an adverse impact on the customers, who were benefiting from the 3G arrangements. Moreover, the DoT directive breached “Article 14” which states equality before law.
According to a Business Standard report, if the 3G roaming pact is held illegal by the court, telcos may have to pay up to Rs. 50 crore per circle as penalty. “This might not have any impact in near term but it means their investments for 3G will not pay off. If the DoT cancels the roaming pact they will lose out on whatever revenue they were making on 3G and any future prospect of revenue. Besides telcos are yet to recover the investments they made for 3G,,” the report quotes Ankita Somani, research analyst, Angel Broking as saying.
The Cellular Operators Association of India estimates about 30 million customers are using 3G services, while 20 percent of them use 3G roaming services. If the 3G arrangement is cancelled, services to these 30 million users could be disrupted.
Source: Economic Times
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