Legislative framework for Regulating Telecommunication sector in Pakistan

ALI ASGHAR DG (Law and Regulation)PTA

SEQUENCESEQUENCE• History of Telecom Legislation in Pakistan• Current Legislation/Regulatory Framework• Pakistan Telecom ( Reorg ) Act 1996• Functions & Powers of Authority• Enforcement orders and penalties• Offences• Rules issued by Federal Government• Regulations issued by PTA• Policies issued by Federal Government• Conclusion

• The Telegraph Act 1885 / The Wireless Telegraphy Act, 1933

•A joint DG of Posts, Telegraph & Telephone

•Postal and Telegraph (Amendment) Act, 1962

•Pakistan Telecommunication Corporation Act, 1991 (PTC)

•Telecommunication Ordinance, 1994

•Pakistan Telecom (Re-Organization) Ordinance, 1995.

•Pakistan Telecommunication (Re-organization) Act, 1996

•Amendments in 2006

History of Telecom Legislation in Pakistan

Current legislation/Telecom Regulatory Current legislation/Telecom Regulatory Regime Regime

• Pakistan Telecommunication Reorg Act 1996.

• Rules issued by Federal Government (MOIT)

• Regulations made by PTA

• Policies issued by Federal Government (MOIT)

Pakistan Telecommunication Authority

Pakistan Telecommunication Company Limited

National Telecommunication Corporation

Frequency Allocation Board

Pakistan Telecommunication

Employees Trust

Pakistan Telecom Reorganization Act 1996

Salient Features of 1996 ActSalient Features of 1996 Act

• Establishment & Empowerment of the telecom Regulator

• Regulation of Telecom Industry and Services

• Transfer of telecom regime to private sector

• Powers of Federal Government to Issue Policy Directives

• Licensing Framework

• Enforcement Mechanism

• Offences & Penalties

• Establishment of PTCL as a Company

• Creation of National Telecom Corporation (NTC) 

• Formation of Frequency Allocation Board (FAB)

Establishment Of PTA

•Number of Members: 3 (by Federal Government)

•Tenure of Members: 4 years (extendable)

•Federal Government :

–MOIT- For issuance of Policy

–Cabinet division –For Administrative matters

Functions of the Authority

1.Regulate

• Establishment, operation and maintenance of

telecom system &

• Provision of telecom services in Pakistan.

2. disposal of applications for use of spectrum

3.Promote/protect interest of Consumers

Cont….Cont….4. Promote the availability of telecom services

throughout Pakistan with

– High quality

– Efficient

– Cost effective

– Competitive rates

5. Promote rapid modernization of Telecom

services & systems6. Investigate and adjudicate Complaints & Claims

against the licensees

Cont….Cont….

7. Recommend to the Federal Government on policies for :

• International telecommunication/ meetings;

• International Agreements on international traffic; and

• Account settlement.

8. Perform other functions as the Government may assign

9. Regulate arrangement amongst telecom service

providers for sharing their revenue

10.Ensure compliance with Universal Services Obligations.

Powers of the Authority Powers of the Authority •Grant and Renew licenses

• Monitor and Enforce licenses

• Refer applications for frequency spectrum to FAB

• Modify the licenses

• Regulate tariff for telecom services

• Regulate transfer of license

•Prescribe standards for equipments

•Regulate Access Promotion Contributions

•

Cont…Cont…

• Protect consumer rights

• Issue guidelines for interconnection

• Inspection of Telecom equipment or premises

• Summon any person for investigation and inquiry.

• Develop National Numbering Plan

• Issue regulations for powers & functions

• Levy fee

• Auction for licensing.

• Settle disputes between licensees

• Regulate Competition in the telecom sector

Responsibilities of the Authority

•Protection of rights of licensees

•Decisions and determinations to be passed through

• Equitable /non-discrimination

• Consistent & transparent manner.

•Expeditious disposal of applications

•opportunity of hearing to affected persons

•Fair competition in the telecom sector

•Protection and safeguarding interests of users

Issuance of Enforcement ) Orders and Issuance of Enforcement ) Orders and penalties (section 23)penalties (section 23)

• In case of contravention of any provision of Act / rules or any term or condition of the license,

• show cause notice and enforcement order– levy fine up to 350 million rupees; or

suspend or terminate the license,– impose additional conditions or appoint an

Administrator

Offences and penaltiesOffences and penalties• Whoever establishes, maintains or operates a telecom

system or service in contravention of Act /rules/ regulations or the conditions of a license;

• dishonestly obtains any telecom service, with the intent to avoid payment;

• unauthorisedly transmits any false, fabricated, indecent or obscene intelligence;

• intentionally modifies or interferes with the contents of a message sent by means of a network;

• prevents or obstructs the transmission or delivery of any intelligence;

• Intercepts or unauthorisedly discloses the contents of intelligence;

• damages, removes, interferes or tampers unauthorisedly deciphers the contents

• intentionally obstructs an officer of the Authority or the Board in the exercise of his functions or powers

• makes unauthorized use of the radio frequency spectrum

• Every offence shall be punishable with imprisonment which may extend to three years, or with fine which may extend to ten million rupees, or with both.

Rules Issued Under section 57 of the Act

Access Promotion Contribution Rules, 2004Access Promotion Contribution Rules, 2004

– To promote the expansion of infrastructure.

– Distribution of fund between LDI and LL operators

– Approval of accounting rates

– International telephony services agreement

– APC contribution and APC for universal service fund.

– reporting requirements for the purpose of

reconciliation.

Pakistan Telecommunication Rules, 2000Pakistan Telecommunication Rules, 2000

procedures for:

• Grant of license

• monitoring, compliance, enforcement and early

termination of licenses

• Determination of significant market power (SMP)

• Interconnection agreements

• interconnection disputes resolution

• Tariff related matters and Appeals.

Research and Development Funds Rules, 2006Research and Development Funds Rules, 2006

In order to:

– Enhance the national ICT related to human resources.

– Develop knowledge based ICT industry

– allocation of funds to the key priority areas in ICT sector

• Obligation to deposit 0.5 % of the gross revenue from

the licensed services.

• Procedures for administration, control and

management by the Federal Government.

Universal Services Fund Rules, 2006Universal Services Fund Rules, 2006

• To expand the basic services including access to the

internet.

• The provisioning of telecom services, systems or

electronic services in un-served and under-served

areas of Pakistan.

• Contribution by the licensee shall be 1.5% .

Regulations issued by the PTA

Access Promotion Contribution Regulations, 2005Access Promotion Contribution Regulations, 2005

• International telephony service agreements.

• The constitution of consortium for the purpose of

negotiating bilateral accounting rates.

• Mode of payment from LDI to LL licensee .

• The transfer of APC for USF.

• The Criteria of calculation of APC.

Accounting Separation Regulations, 2007Accounting Separation Regulations, 2007

• For the determination of revenue earned from

the licensed services,

• the licensees are required to prepare separated

accounts, and submit report which includes:

• Profit and Loss statement;

• Balance Sheet information

• Return on Capital Employed & Supporting Notes

Protection from Spam, Unsolicited, Fraudulent and Protection from Spam, Unsolicited, Fraudulent and Obnoxious Communication Regulations,2009Obnoxious Communication Regulations,2009

• To ensure and protect the interest of consumers

• Measures and procedure to control…..

• Establishment of a “Do Not Call” (DNCR) Register

• Registration and management of tele-marketing by

operators to control over unsolicited calls.

• Complaint handling procedure

Class Licensing & Registration Regulations, Class Licensing & Registration Regulations, 20072007

• to regulate the issuance of CVAS licensing.

•The authorization of value added services for:

–Class licensing for voice value added services.

–Class licensing for data value added services.

• Registration of certificates for registration services.

• Procedure for the grant of license and fees

Consumer Protection Regulations, 2009Consumer Protection Regulations, 2009

• Service provisioning, Interruption and disconnection

• Procedure for disconnection of services by operators

• Licensees to refrain from unfair commercial practices,

misleading actions or omissions and concealment of facts

and avoid deception of average consumers.

• Tariff and billing should be advertised as approved

• Redressal of consumer grievances

– Complaint handling by the operator

– Complaint handling by the authority

Fixed line Tariff Regulations, 2004Fixed line Tariff Regulations, 2004

• Provisions regarding settlement of Tariff of Non-SMP

operators .

• Flexibility in Impositions of Price with respect to basket

services at any date and frequency.

• Submission of information regarding financial statements to

the authority.

Interconnection Disputes Resolutions Interconnection Disputes Resolutions Regulations, 2004Regulations, 2004

• For handling disputes between the licensees related

to interconnection,

• prescribe procedure for handling and investigating

such disputes.

Number Allocation & Administration Number Allocation & Administration Regulations, 2011Regulations, 2011

• Under section 5 of the Act, the Authority is empowered to

develop national telecommunication numbering plan.

These regulations provide:

• The establishment, maintenance and operation of telecom services.

• Organizations having the authority to issue short codes and

Universal access numbers are also dealt under the provisions of

these regulations.

Telecom and terminal equipment installer regulations, Telecom and terminal equipment installer regulations, 20122012

• Registration of minimum standards of installing the

telecom equipment ( wired or wireless).

• Provisions of uninterrupted access to multi-play

telecom services/broadband by using latest technology.

• Regulations apply to access networks (wired or

wireless) and Telecom equipment

• PTA guidelines on in-house telecom wiring may be

referred where applicable

Broadband Quality of services regulations, Broadband Quality of services regulations, 20142014

1. Applicable to all BSPs in order to define the key

performance indicators (KPI’s) for broad band services.

• KPI’s will act as benchmarks for the determination of

quality of broadband services

• Testing methodology for the quality of services.

• Technical & non technical services standards for BSPs

Mobile Number Portability Regulations, 2005Mobile Number Portability Regulations, 2005

• Provisions regarding the subscriber of MNP to port

from one operator to another.

• Rights and obligations of donor/recipient operators

and the subscribers of the MNP.

Monitoring and Reconciliation of International Monitoring and Reconciliation of International Telephony Traffic Regulations, 2010Telephony Traffic Regulations, 2010

All LDI licensees are obliged to:

•enforce the accurate presentation of the total traffic

terminated.

•Monitor the information passing through equipment with

access providers and licensee.

•Reconciliation of traffic terminated.

•Measure and record of the billing verification

•Detection and control over grey trafficking.

PTA (Functions & Powers) Regulations, 2006PTA (Functions & Powers) Regulations, 2006

• Procedure for grant of licenses

• Application process for licenses

• Procedure to entertain the complaints

• Procedures for hearing after show cause notice

• Procedure for appeals

• Matters relating to transfer of license

• Issues regarding fee and other charges etc.

Type Approval Regulations, 2004Type Approval Regulations, 2004

• The Authority is empowered to determine and type

approve telecom terminal equipment.

• prescribe detail procedures for:

– Obtaining type approval certificate

• List of models not type approved in Pakistan.

Protection from Health Related Effects of Radio Base Protection from Health Related Effects of Radio Base Station Antennas Regulations, 2008Station Antennas Regulations, 2008

• To ensure compliance with the preventive

measures

• To follow the requirements for installation of

antenna,

• procedure for Antenna installation and safety.

Policies made by Federal Government

Powers of the Federal Government to issue the Powers of the Federal Government to issue the directivesdirectives

• The Federal Government may issue policy directives to

PTA whose compliance is to be ensured.

• The directives can be issued regarding:

• The number and terms of the licenses granted,

• The framework for the telecom sector

• The nationality and region to whom the licenses

for the network is to be issued.

• the requirements for the national security.

Important Policies issued by Federal Government

Deregulations Policy

2003

Cellular Policy

2004 Broadband Policy

2004

USF & R&D Policy NGMS Policy 2013Telecom Policy

Review(Under Progress)

Technology Neutral - 2 New LicensesTechnology Neutral - 2 New LicensesTechnology Neutral - 2 New LicensesTechnology Neutral - 2 New Licenses

Open AuctionOpen AuctionOpen AuctionOpen Auction

Highest Bid – US$ 291 MillionHighest Bid – US$ 291 MillionHighest Bid – US$ 291 MillionHighest Bid – US$ 291 Million

Warid & TelenorWarid & TelenorWarid & TelenorWarid & Telenor

Role-Out Obligations – 70% Tehsil HQs Role-Out Obligations – 70% Tehsil HQs (US$ 15M Performance Bond)(US$ 15M Performance Bond)Role-Out Obligations – 70% Tehsil HQs Role-Out Obligations – 70% Tehsil HQs (US$ 15M Performance Bond)(US$ 15M Performance Bond)

Existing Operators to Pay the Same Amount for RenewalExisting Operators to Pay the Same Amount for RenewalExisting Operators to Pay the Same Amount for RenewalExisting Operators to Pay the Same Amount for Renewal

Cellular Mobile Policy - 2004

Spectrum auction for NGMS- 2100 MHs & 1800 MHs Spectrum auction for NGMS- 2100 MHs & 1800 MHs Spectrum auction for NGMS- 2100 MHs & 1800 MHs Spectrum auction for NGMS- 2100 MHs & 1800 MHs

Auction for 3G/4G held in April 2014Auction for 3G/4G held in April 2014Auction for 3G/4G held in April 2014Auction for 3G/4G held in April 2014

Total Bid/Auction Price – US $ 1.128 BillionTotal Bid/Auction Price – US $ 1.128 BillionTotal Bid/Auction Price – US $ 1.128 BillionTotal Bid/Auction Price – US $ 1.128 Billion

Highest Bidders- Zong, Telenor, ufone ,MobilinkHighest Bidders- Zong, Telenor, ufone ,MobilinkHighest Bidders- Zong, Telenor, ufone ,MobilinkHighest Bidders- Zong, Telenor, ufone ,Mobilink

NGMS Policy - 2013

Roll out obligations – 20 % converge of existing sites in 9 Months Roll out obligations – 20 % converge of existing sites in 9 Months Roll out obligations – 20 % converge of existing sites in 9 Months Roll out obligations – 20 % converge of existing sites in 9 Months

Period of license term –15 years Period of license term –15 years Period of license term –15 years Period of license term –15 years

Policy directive for Web Content ManagementPolicy directive for Web Content Management

To ensure the effective mechanism for proper monitoring, evaluation and

control of the contents available on the internet.

•to establish the mechanism by ensuring that :

–The web contents are not in violation of constitution or local laws.

–The web blocking does not effect the fundamental rights of the

citizens.

–The relevant stakeholders have been consulted

–The web monitoring cell will be strengthened

Technical implementation of Mobile Banking including Mobile Technical implementation of Mobile Banking including Mobile Money Transfers and RemittancesMoney Transfers and Remittances

• access to financial services through alternative mechanism.

• The SBP may allow the licensees to take part in M-Banking activity on their own

• The FIs will be responsible to protect fraud and risks.

• Third Party Services provider will be involved in case of multiple financial institutions

• The regulations should be made based on the following parameters:

– Eligibility of offering M-Banking services.

– Network Conditioning.

– Transaction data security and integrity.

– Third Party Services Providers.

– Quality of services and SLA benchmarks

Conclusion Conclusion

• Primary & Secondary Legislation require consultation with all stakeholders

• Clear and unambiguous drafting to avoid disputes and litigation

• Consistent Review and modifications

• Effective Monitoring and Enforcement Mechanism

• International Best practices to be adopted as per country specific requirements

• Q &A

Thanks