TRAI and Competition

Authority: Overlapping and

Operational Isuues
Prof. S. P. Srivastava
Primary Concern

1. Appropriately identify issues of concern.

2. Ensure appropriate channelization of various concerns
to the appropriate forum and obtaining corrective action
at the earliest;
3. Establish a framework that avoids duplication of effort;
4. Conserve the Commission's resources and limit its
ambit only to matters of competition; and
5. Promote capacity building and developing expertise
both at the level of the competition regulator and the
sectoral regulator.
TRAI ACT997
 Preamble
 “an Act to provide for the establishment of

Telecom Regulatory Authority of India and the

Telecom Disputes Settlement and Appellate
Tribunal to regulate the telecommunications
services, adjudicate disputes, dispose of
appeals and to protect the interests of service
providers and consumers of the telecom sector,
to promote and ensure orderly growth of the
telecom sector and for matters connected
therewith or incidental thereto”.
 S. 11 “(1) Notwithstanding anything contained
in the Indian Telegraph Act, 1885, the
functions of the Authority shall be to (a) make
recommendations, either suo motu or on a
request from the licensor, on the following
matters, namely:…(iv) measures to facilitate
competition and promote efficiency in the
operation of telecommunications services so
as to facilitate growth in such services… (viii)
efficient management of available spectrum”.
Proviso (A) to section 14(a) of the
TRAI Act, 1997
 “Provided that nothing under this clause shall
apply in respect of matters relating to – (A)
the monopolistic trade practice, restrictive
trade practice and unfair trade practice which
are subject to the jurisdiction of the
Monopolies and Restrictive Trade Practices
Commission established under sub-section
(1) of section 5 of the Monopolies and
Restrictive Trade Practices Act, 1969”.
Section 38 of the TRAI Act, 1997
 states: “The provisions of this Act shall be in
addition to the provisions of the Indian
Telegraph Act, 1885 and the Indian Wireless
Telegraphy Act, 1933 and, in particular,
nothing in this Act shall affect any
jurisdiction, powers and functions required to
be exercised or performed by the Telegraph
Authority in relation to any area falling within
the jurisdiction of such Authority.”
Consumer Online Foundation v. Tata Sky
Ltd. & Other Parties [Case 2/2009],
 Dish TV submitted that the CCI could not claim
jurisdiction over this matter as Telecom
Regulatory Authority of India (TRAI) and Telecom
Disputes Settlement and Appellate Tribunal
(TDSAT) were already vested with the “jurisdiction
and responsibility to govern and regulate the
telecommunication industry covering telecom,
broadcasting and cable TV services….”. CCI held
that any matter that raises competition concerns
would fall within the purview of the Competition
Act, 2002 enabling CCI to exercise its jurisdiction.
CCI v. Fast way Transmission Ltd.
 The Supreme Court of India (Supreme Court)
has overturned the Competition Appellate
Tribunal’s (COMPAT) order and confirmed the
Competition Commission of India’s (CCI)
order confirming abuse of dominance by
multi-system operators (MSOs).
 Affirms the exclusive jurisdiction of the CCI

to deal with anti-competitive conduct even in

regulated sectors with special sectoral
regulators.
Facts
 The case in question concerns information filed by a broadcaster of a television
channel against a group of MSOs (part of the same group) who carried the
aforesaid channel to viewers of Cable TV.
 In the cable television market, the role of an MSO is to downlink the broadcasters’
signals, decrypt any encrypted channels and provide a bundled feed constituting
of multiple channels to the last-mile cable operators (LCO). The LCO then re-
transmits these signals to the subscribers in its area of operation through the
cable network.
 In the cable television market, MSO functions are regulated under the
Telecommunication (Broadcasting and Cable Services) Interconnection Regulation
2004 (Broadcasting and Cable Interconnection Regulations) framed by the TRAI.
 The CCI found that the group of MSOs were inter-related and constituted a
“group” in terms of the Competition Act. Additionally, the CCI found that the
group occupied a dominant position in the relevant market for provision of cable
TV services in Punjab and Chandigarh.
 the MSOs challenged the jurisdiction of the CCI claiming that a dispute between a
broadcaster and an MSO falls within the exclusive jurisdiction of the TDSAT.
Supreme Court Observation
 The Supreme Court noted that the term denial of market
access “in any manner” is of wide import and must be
given its natural meaning. Accordingly, the Supreme
Court noted that once the existence of a dominant
position is proved, the question of whether the denial of
market access is being done by a competitor or not is
irrelevant. The only relevant factor, according to the
Supreme Court, is the denial of market access due to
unlawful termination of the CPA.
 Supreme Court have implicitly recognised that the CCI’s
jurisdiction to protect competition under the Competition
Act can co-exist with that of sectoral regulators or other
authorities (even if the underlying facts are the same).
C.C.I. v. Bharti Airtel. AIR 2019 SC
113.
 Facts:
Reliance Jio Infocomm Limited filed an application under
Section 19(1) of the Competition Act, 2002 which states that
the commission may inquire into certain agreements and
dominant position of enterprise, alleging abuse of dominant
position and cartelization by Bharti Airtel, Idea Cellular
Limited, Vodafone India Limited (collectively, the ‘IDOs’) and
the Cellular Operators Association of India for the violation of
section 3 & section 4 of the Act.
Further Jio alleged that the cartel restricted it to enter into the
telecom market by denying the sufficient number of Point of
Interconnection (‘PoI’) to it. Further, Jio filed an application
before TRAI to look into the conduct of IDO and the COAI.
Issues:
 Were Vodafone/Airtel/Idea (called IDOs or
incumbent dominant operators) under any
obligation to provide POIs;
 2. Whether the demand for POIs made by Jio

was reasonable or not; and

 3. Whether IDOs have provided sufficient

number of POIs to Jio in conformity with the

licence conditions.
Continued:
1. All three were held to be jurisdictional aspects and
accordingly, TRAI was given the first instance to
investigate. As per this logic, once the jurisdictional
aspects are determined by TRAI, the next question
would be whether it was a result of any concerted
agreement among the IDOs and whether the COAI
facilitated the same.
2. By recognising the distinct functions of the CCI vis-à-
vis detection of concerted action, the SC stated that it
was within the exclusive domain of the CCI to find out
whether the particular case was in fact that of
cartelisation and whether it had an appreciable adverse
effect on competition within the relevant market in
India. In this way, the SC did not oust the jurisdiction of
the CCI entirely. .
4. The SC further held that the CCI is delegated
with an important role to curb anti-competitive
practices in the relevant markets of India and
this responsibility delegated to CCI should not
be washed away completely and “the ‘comity’
between the CCI and TRAI is to be maintained”.
5. The jurisdiction of the CCI is not outset
completely with regard to telecom sector but the
CCIs jurisdiction is pushed out to the later
phase, once the issue is decided by the TRAI.
Conclusion
 By recognising the distinction between the underlying
prerogatives of TRAI and CCI, the Supreme Court seemed to
put forth the view that both regulators’ functions are not
mutually exclusive – i.e. not substitutable but rather
complementary. In principle, this is a good finding.
 But at the same time, the court regarded CCIs investigation as
being indirectly dependent on that of TRAI’s by stating:
“Once that exercise (investigation of jurisdictional aspects) is
done and there are findings returned by the TRAI which lead
to the prima facie conclusion that the IDOs have indulged in
anti-competitive practices, the CCI can be activated to
investigate the matter going by the criteria laid down in the
relevant provisions of the Competition Act and take it to its
logical conclusion.”
Issues for further deliberation
 what would the course of action be if the telecom
regulator does not find any breach?
 Is it not that the Supreme Court’s approach seems
to have somewhat diluted the per se legal standard
accorded to Section 3 of the Competition Act (the
mere presence of collusion is in itself punishable)?
 TRAI having specialised knowledge about the
subject matter, might miss out on clearly identifying
the presence or absence of collusion, something
that only CCI’s general perspective (cutting across
sectors) and experience brings to the table.