The Indian Telecommunication Bill 2022 provides a clear way for insolvency cases and stressed telecom assets

A number of improvements will be implemented as a result of the proposed Indian Telecommunication Bill 2022, such as the creation of a distinct set of guidelines for handling the financial ruin of financially troubled telecom assets, easing merger and acquisition regulations, and giving the government the authority to waive operator debts.

Senior figures claim that if a telecom provider declares bankruptcy, the new Bill will give the government control of the spectrum. To make the current Insolvency and Bankruptcy Code rules more clear, this is being done.

Since it was unclear if the spectrum controlled by the failing operator belonged to the Center or if banks could seize it, insolvency proceedings under the IBC did not fare well. Since spectrum is a public asset and the government owns it, according to DoT, it cannot be sold by banks as part of an insolvency proceeding. The struggling provider will continue to be the owner of the licence and spectrum under the new structure as long as it continues to offer services and make government dues payments. Additionally, if the carrier’s services are discontinued, the spectrum will be returned to the government.

Indian Telegraph Act 1885, Indian Wireless Telegraphy Act 1933, and The Telegraph Wires (Unlawful Protection) Act 1950 will all be combined into one law under the Indian Telecommunication Bill, which is likely to be submitted to parliament.

In addition, the government intends to establish a framework for handling financially troubled telecom firms. Discussion of these conditions comes as struggling provider Vodafone Idea struggles to reduce its overall debt of $2 lakh crore, of which over 75% is owed to the Center.

The Indian Telecommunications Statute will be compatible with the TRAI act, in addition.