Jyotsna JayaramPartner
Akshaya ParthasarathySenior Associate
Amala GAssociate
Key Developments
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Telecom department issues additional Know Your Customer instructions for business connections
In May 2024, the Department of Telecommunications (DoT) issued additional instructions on Know Your Customer (KYC) requirements for obtaining business connections clarifying that undertaking KYC verification of end users is optional in certain scenarios (KYC Instructions).1
In August 2023, the DoT discontinued the erstwhile bulk connection regime applicable for issuing mobile connections to companies, partnerships, etc., and introduced a new ‘business connections’ category for regulating the issuance of mobile connections to business entities. The DoT had also prescribed the KYC verification procedures to be undertaken by telecom service providers offering business connections, which the KYC Instructions have further clarified.2
Pursuant to these KYC Instructions, undertaking the KYC of end users is optional where the end users of the business connection are not identifiable, such as in the case of SIM cards obtained for research, development and testing activities for a specified purpose. However, telecom service providers must ensure that the following conditions are fulfilled in those circumstances:
- The mobile connection is issued only by the telecom service provider’s employees.
- Before issuing the connection, an undertaking is obtained from the subscribing entity setting out the use cases having no end users of the business connections such that the telecom service provider can satisfy itself that the use case provided is realistic.
- Physical verification of the subscribing entity’s address and premise is carried out before issuing the connection.
- The connection is provided with limited call/SMS/data facilities for a definite validity period which can be a maximum of one year at a time.
- The number of connections issued to any given entity is less than hundred.
- The connections must not be used for machine-to-machine connections.
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Telecom regulatory authority issues further directions to address spam complaints
On 24 June 2024, the Telecom Regulatory Authority of India (TRAI) issued directions to certain telecom companies under the Telecom Commercial Communications Customer Preference Regulations, 2018 (TCCCPR) to improve their mobile applications and web portals in relation to receiving and processing spam (also known as unsolicited commercial communications or UCC) complaints (TRAI Directions).3
Customers must be able to register spam complaints and their preferences for receiving messages on the mobile applications and/or web portals of the concerned telecom company. The TRAI Directions require telecom companies to modify their mobile applications and/or web portals to:
- prominently display options/hyperlinks for the registration/modification of preferences and for the registration of UCC complaints on the first view of the main page,
- enable a mechanism in mobile applications that informs customers about granting permissions to access call logs and other details,
- ensure that, with customer consent, essential details such as the senders’ number/header, date of UCC, SMS text, etc., are auto populated when customers register UCC complaints on mobile applications, and
- apply the necessary validations at the backend to prevent invalid entries while UCC complaints are registered.4
Telecom companies are required to comply with these directions and furnish a compliance report within 45 days from the date of issuance of the TRAI Directions. Access service providers must submit performance monitoring reports monthly.
Additionally, TRAI issued guidelines on 18 June 2024 to access service providers, reiterating the important regulatory requirements under the TCCCPR. These guidelines focused on the registration requirements for senders and message headers, confidentiality requirements and customer protection. Telecom companies are required to comply with these directions and furnish a compliance report within 15 days from the date of issuance of the guidelines.
In the coming months, several interesting developments may be expected in the telecommunications space. Recently, several provisions of the new Telecommunications Act, 2023 (Telecommunications Act) have come into effect, and the remaining provisions are likely to be brought into effect in due course (to read our detailed update on the Telecommunications Act, click here). Further, the newly elected government has unveiled its plans to tackle online and phone frauds with the involvement of all stakeholders in its 100-day plan.
[1]Please see the DoT’s circular on additional KYC instructions for business connections here: https://dot.gov.in/sites/default/files/20052024.pdf?download=1
[2]Please see the DoT’s circular on discontinuation of bulk connections here: https://dot.gov.in/sites/default/files/KYC.pdf?download=1
[3]https://www.trai.gov.in/sites/default/files/PR_No.34of2024.pdf
[4]https://www.trai.gov.in/sites/default/files/Directionss_24062024_1.pdf
