ISP License stands for Internet Service Provider License, which is a legal document that authorizes a business entity to provide internet services to their clients. This document is issued by the Department of Telecommunications (DoT). Individuals are ineligible to apply for obtaining the license directly. To obtain the license, first, they need to incorporate a company under the provisions of the Companies Act, 2013, and then apply to the DoT for an ISP authorization for the company.
It is essential to ensure the company fulfills prescribed eligibility criteria set forth by the Department before applying for the license so as to avoid rejection or any delays in approval. Once these requirements are met, the company can then proceed with application process for obtaining the license.
Only a non-individual entity, i.e., a company registered under Companies Act, 2013, is eligible to apply for this license. This very line suggests that individuals cannot directly apply for or obtain this license. Doing so will be considered a non-compliance with the prescribed eligibility criteria and lead to rejection of the application. As a result, your money and efforts will go in vain.
The requirement exists because providing internet services involves large scale infrastructure, strict regulatory compliance, national security obligations and significant financial resources. All of these things are better managed by a formally structured corporate entity.
Apart from the primary requirement that the applicant must be a company incorporated under the Companies Act, 2013, there are several other conditions that need to be fulfilled before applying for the internet license. Below, we have explained some of the most important conditions one by one:
The Memorandum of Association of applicant entity should clearly mention telecom or internet services as one of the main business activities it'll undertake.
A board resolution must be passed to authorize the filing of an ISP application for the company.
The company and its promoters/directors should not have a history of violations pertaining to telecom or serious regulatory issues. Also, they must be willing and able to follow all the rules, obligations and conditions mentioned in the license agreement.
All the important company documents must be in place such as the Certificate of Incorporation, Articles of Association, Board Resolution and Power of Attorney.
As part of documentation requirements, details of all directors and shareholders must be available like their PAN cards, Aadhaar cards and Director Identification Numbers.
If the company has foreign investment, the foreign shareholding must be within telecom sector limits set by the government. If it exceeds allowed limit, obtaining prior government approval is a must.
Different ISP registration categories have different financial requirements. Category A (National) and Category B (State) licenses have high minimum net worth requirements as well as entry fees. Category C (District) is usually the most affordable option for new businesses.
After the initial approval of your application and receipt of the Letter of Intent (LOI), the company will be required to submit Performance Bank Guarantee (PBG) with the Department. The amount totally depends on the operational service.
A non-refundable application processing fee must be paid while submitting the application. So, it is necessary to have the required funds while filing the application.
Also Read: How Do ISPs Make Money?
Prior to filing an application for an ISP license with the DoT, it is necessary to learn about all the eligibility requirements. Failure to meet even one requirement can lead to delays or, in the worst case scenario, rejection of the application. If you have any doubts in your mind regarding eligibility requirements, you can get in touch with our ISP licensing experts at Registrationwala for professional guidance.
Q1. Is LLP eligible to apply for and obtain an internet service provider license from DoT?
A. No, LLP is ineligible to apply for and obtain this license. Only a company registered under Companies Act 2013 is eligible for it.
Q2. Is board approval required for filing an ISP application?
A. Yes, board approval is most certainly required. A board resolution authorizing the company to apply for the ISP License must be submitted at the time of application filing.
Q3. Are sole proprietorships eligible for ISP registration?
A. No, sole proprietorships are ineligible for this registration. Only companies registered under the Companies Act, 2013 are eligible for this registration.
Hey there, I'm Dushyant Sharma. With the extensive knowledge I've gained in past 8 years, I have been creating content on various subjects such as banking, insurance, telecom, and all the important registration and licensing processes for various companies. I'm here to help everyone with my expertise in these areas through my articles.
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