A Detailed Look at the Revised Guidelines of IP-1 License

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A Detailed Look at the Revised Guidelines of IP-1 License

Department of Telecommunication, through its latest notification dated: 22nd December 2021, introduced revised guidelines for Registration of Infrastructure Providers – Category – I (IP-I). IP1 license is the business permit that allows the licensee to deliver passive infrastructure to TSPs and ISPs. This article explores the amendments DOT has introduced to the traditional regulations for IP-1 Licenses.

An infrastructure provider is a business entity that provides passive telecom resources to TSPs and ISPs. Such resources entail:

1. Right of Way
2. Duct Space
3. Dark Fibres
4. Cell Towers

Recently, the Department of Telecommunication – the issuer of the IP-1 Registration – provided a notification that brought forth amendments to the license guidelines.

Let us take a look at those modifications.

But first, let’s explore the guidelines that have remained as they were.

Guidelines of IP-1 Registration that remain the same

The following are the guidelines for the Registration of Infrastructure Providers that have remained the same.

1. The applicant must be an Indian company incorporated under the Companies Act, 2013.
2. Applicant must provide the documents as specified in the official notification.
3. The applicant must make all the arrangements concerning the Right of Way.
4. Any modification in the infrastructure of the applicant’s company must be as per the provisions under the Companies Act, 1956/2013.
5. DOT will inform the applicant about the approval or rejection of the application within 15 days of submission.
6. The applicant company must provide the telecom resources, including, Right of Way, Duct Space, Towers, and Dark Fibres, for rent, lease, or sale basis.
7. After the applicant acquires the IP 1 License, they must agree with Telecom service providers within 15 days.
8. After becoming an Infrastructure Provider, the applicant must adhere to the terms and conditions of IP-1 Registration.
9. The application processing fee is INR 5,000/-

The changes that DOT has introduced to the IP-1 license are all due to one point: modification in regulations related to Foreign Direct Investment.

Modified Guidelines for Foreign Direct Investment

Department of Telecommunication allowed 100% FDI into India’s Telecom Sector this year. The revised regulations about that decision.

1. Entities belonging to the following countries can only utilize the government route to invest in Indian Infrastructure Providers:
2. Countries that share borders with India
3. The country in which lives the beneficial owner of the IP-1 company
4. If the entities wish to transfer the ownership of Foreign Direct Investment, they have to do so under the government route.
5. The government will consider both indirect and direct foreign investment to calculate the total FDI.
6. The applicant company, investment companies, or Indian promoters will comply with the relevant FDI policies of the government.
7. Foreign Direct Investment will be subject to Indian laws and not the country from which the investment originates.
8. FDI, Foreign Equity, Investment Companies, FIPB, etc., will have the same meaning as defined by the Department of Promotion of Industry and Internal Trade (DPIIT) in its FDI policy.

Conclusion

The changes the government has brought forth for IP1-registration in India are due to its recent modifications in rules about foreign direct investment. If you want to keep in touch with such amendments about any telecom license in the future, contact Registrationwala.

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