Trai ends differential tariffs

Telecom service providers have been barred from slapping discriminatory tariffs on subscribers who use third-party services.

While the restriction will apply to services like Internet use via dial-up and leased-line routes, telephone operators can continue to adopt a differential pricing strategy for phone calls originating and terminating on their networks (on net calls) and those connecting a subscriber with another operator (off-net calls).

In recent months some companies had opposed BSNL's decision to cut leased-line tariffs for its subscribers who had also opted for the state-owned company's leased line service.

BSNL, which offers its infrastructure to other operators, had not offered the same tariffs to some Internet service providers.

"Differential tariffs in the nature of vertical price squeeze shall be a case of discriminatory tariff since such differential tariffs adversely affect competition... ," Trai said while amending the Telecommunications Tariff Order.

Trai also mandated that in case of differential tariffs, operators would be required to define the eligibility criteria clearly for on-net and off-net calls.

Operators have been asked to conduct a "self-check" of existing tariff to ensure that the charges are consistent with the Trai guidelines.

Vertical price squeeze means differential tariff assuming the nature of anti-competitive conduct that may occur when an operator with significant market power controls certain key inputs required by competitors in downstream markets and where such operators or its affiliates use those key inputs to compete in the downstream market