Experts warn that the removal of the waiver provision in the Telecom Bill could potentially harm the recovery of Vi, a telecommunications company.

The financially struggling telecom operator Vodafone Idea (VI) is set to face further challenges following the introduction of the Telecommunications Bill, 2023. The new regulation eliminates provisions that previously allowed for waivers of license fees, penalties, and charges. According to lawyers and analysts cited by The Economic Times (ET), this change will make it even more difficult for the beleaguered telco to raise additional funds.

The initial draft of the Bill included a framework that would have allowed financially troubled companies like Vodafone Idea to have their license fees waived. If these provisions had made it into the final bill, it would have provided some relief for VI.

However, the final version of the Bill has removed these powers to waive or defer fees, penalties, and charges. This development is expected to have a negative impact on Vodafone Idea’s financial situation. Manmeet Kaur, a partner at Karanjawal & Co, noted that the removal of these provisions is likely due to concerns about potential problems arising from the discretionary powers it would grant the government.

The original draft stated that such charges could be waived in specific circumstances to protect consumer interests, promote competition, ensure reliable and continuous telecom services, and maintain the availability of telecom networks and infrastructure in India.

Abhay Chattopadhyay, a partner at Economic Laws Practice, explained that the draft intended to establish a framework that would have allowed the government to assist struggling telecom companies.

With only four main players in the telecom sector, including Jio, Bharti Airtel, Vodafone Idea, and BSNL, experts argue that the survival of Vodafone Idea is crucial to prevent a duopoly situation in the industry. Jio and Airtel currently dominate the market.

The removal of provisions allowing for waivers of fees and charges in the Telecommunications Bill, 2023 presents another hurdle for Vodafone Idea, making its financial recovery even more challenging.,

The removal of the waiver provision in the Telecom Bill could have negative implications for Vi’s recovery, according to experts. The provision allowed telcos to seek relief in case of issues arising from the Supreme Court’s Adjusted Gross Revenue (AGR) verdict. Without this provision, Vi may face challenges in dealing with the hefty AGR dues, potentially impacting its financial health and recovery prospects. This development raises concerns about the future of Vi, which is already struggling with mounting debts and intense competition in the telecom industry.

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