By Pritha Lahiri, a student of Institute of Law, Nirma University.
Background:
Recently, the Department of Telecommunications (DoT) has introduced amended guidelines[i] for the Other Service Providers (OSP). The Other Service Provider (OSP) is a Company registered under the Companies Act, 2013 or Limited Liability Partnership (LLP) that uses telecom resources provided by authorised Telecom Service Providers to provide application services such as telebanking, telemedicine, tele-education, tele-trading, e-commerce, call centre, network operation centre, and other Information Technology enabled services (ITes).[ii] These revised simplified guidelines will be replacing the earlier guidelines released back in November 2020 (2020 Guidelines). Former IT and Communications Minister, Mr Ravi Shankar, while introducing the revised rules revealed that India has one of the largest Business Processing Outsourcing (BPO) Industries which is expected to rise by double digits, reaching 3.9 lakh crores by 2025. The amended guidelines are aimed at giving the BPO industry a boost and placing India as one of the world’s most competitive I.T jurisdictions. It is further expected to provide an impetus to India to its Atma Nirbhar Bharat Campaign which seeks to make the country and its people self-sufficient in all ways. The present article seeks to trace the developments of the released guidelines along with listing down its probable effects on the BPO and the IT Enabled Services Industry (ITes). Why was OSP Rules Introduced? In the 1990s, Information Technology Industry in India experienced exponential growth in the country and along with that, a slew of new OSPs, both voice and non-voice based, have entered the market. The sector needed little capital but yielded high profits, prompting a significant number of people and businesses to start their own OSPs. To keep track of the usage of the resources by these OSPs, the Department of Telecommunication (DoT) introduced the first set of rules in 1999 requiring all the OSPs to register themselves. At that time, a regulatory embargo was required considering it was a very new system for everyone and there was a very different requirement on the networks which meant that there was always a possibility of it being misused. 2020 OSP Rules- A brief fact-check: The 2020 OSP Guidelines was a baby step towards creating a friendly regime for the OSPs. It removed the registration requirement along with removing all the compliance requirements like furnishing bank guarantees. The concept of Remote work was also introduced, providing flexibility to the employees of the industry. The guidelines enabled the use of VPNs to share infrastructure for internal communication providing a secured transmission of information. It also prohibited circumventing the International Long Distance Operator (ILDO) and National Long Distance Operator (NLDO) jurisdictions. While these guidelines proved to be a boon for the industry, it was still silent on topics such as cloud-based hosted contact centres, permissible connectivity between OSPs and remote agents in the event of work outside the OSP centre, and so forth. Revised OSP Rules of 2021- Key Changes and its implications: Going a step further, the DoT released revised guidelines for Other Service Providers (New Guidelines), which further simplify and supersede the 2020 guidelines. Following are the key changes in the revised guidelines-
Background:
Recently, the Department of Telecommunications (DoT) has introduced amended guidelines[i] for the Other Service Providers (OSP). The Other Service Provider (OSP) is a Company registered under the Companies Act, 2013 or Limited Liability Partnership (LLP) that uses telecom resources provided by authorised Telecom Service Providers to provide application services such as telebanking, telemedicine, tele-education, tele-trading, e-commerce, call centre, network operation centre, and other Information Technology enabled services (ITes).[ii] These revised simplified guidelines will be replacing the earlier guidelines released back in November 2020 (2020 Guidelines). Former IT and Communications Minister, Mr Ravi Shankar, while introducing the revised rules revealed that India has one of the largest Business Processing Outsourcing (BPO) Industries which is expected to rise by double digits, reaching 3.9 lakh crores by 2025. The amended guidelines are aimed at giving the BPO industry a boost and placing India as one of the world’s most competitive I.T jurisdictions. It is further expected to provide an impetus to India to its Atma Nirbhar Bharat Campaign which seeks to make the country and its people self-sufficient in all ways. The present article seeks to trace the developments of the released guidelines along with listing down its probable effects on the BPO and the IT Enabled Services Industry (ITes). Why was OSP Rules Introduced? In the 1990s, Information Technology Industry in India experienced exponential growth in the country and along with that, a slew of new OSPs, both voice and non-voice based, have entered the market. The sector needed little capital but yielded high profits, prompting a significant number of people and businesses to start their own OSPs. To keep track of the usage of the resources by these OSPs, the Department of Telecommunication (DoT) introduced the first set of rules in 1999 requiring all the OSPs to register themselves. At that time, a regulatory embargo was required considering it was a very new system for everyone and there was a very different requirement on the networks which meant that there was always a possibility of it being misused. 2020 OSP Rules- A brief fact-check: The 2020 OSP Guidelines was a baby step towards creating a friendly regime for the OSPs. It removed the registration requirement along with removing all the compliance requirements like furnishing bank guarantees. The concept of Remote work was also introduced, providing flexibility to the employees of the industry. The guidelines enabled the use of VPNs to share infrastructure for internal communication providing a secured transmission of information. It also prohibited circumventing the International Long Distance Operator (ILDO) and National Long Distance Operator (NLDO) jurisdictions. While these guidelines proved to be a boon for the industry, it was still silent on topics such as cloud-based hosted contact centres, permissible connectivity between OSPs and remote agents in the event of work outside the OSP centre, and so forth. Revised OSP Rules of 2021- Key Changes and its implications: Going a step further, the DoT released revised guidelines for Other Service Providers (New Guidelines), which further simplify and supersede the 2020 guidelines. Following are the key changes in the revised guidelines-
- The revised guidelines have defined ‘Voice-based BPO Services’[iii] to refer to the call centre services by the OSPs globally and the calls are made to the customer via Public Switched Telephone Network (PSTN)/ Public Land Mobile Network (PLMN)/Integrated Services Digital Network (ISDN) (Public Network). This clarification has been a welcome move in separating non-voice based BPO from the ambit of the OSP Rules leading to the rules being more specific and avoiding confusion created due to the earlier guidelines which didn’t segregate the BPO Services.
- It has given a proper definition to ‘Toll bypass’[iv] to mean the illegal carriage of voice calls between Public Network (a) at the domestic end in India and a foreign country; or (b) of two cities in India, by using the OSP’s network, as opposed to the network of the authorised Telecommunications Service Provider (TSP). The new definition has provided more clarity on the term which will lead to the efficient formulation of call structures.
- The 2021 guidelines have also done away with the distinction between domestic and international OSP centres. This allows a single call centre to service both international and national customers. It has led to the industry adopting a simpler working model with less infrastructure cost.
- OSPs can now interconnect using any wide-area networking (WAN) technology over National Private Leased Circuit (NPLC)/MPLS VPN, such as SD-WAN[v]. The reduction of interconnection limitations and the use of distributed architecture could pave way for seamless knowledge transfer as well as allowing players to juggle their resources at their convenience, based on orders and workload.
- All OSPs (including domestic OSPs) are permitted to have their Electronic Private Automatic Branch Exchange (EPABXs) at foreign locations.[vi] Companies will now be able to use their global EPABX for their contact centres in India, as well as implement global technologies that are not available on Indian EPABXs.