TRAI Announces New Telecom Interconnection Regulations 2026, Rules To Come Into Effect From January 1

New Delhi: The Telecom Regulatory Authority of India (TRAI) on Tuesday released “The Telecommunication Interconnection (Third Amendment) Regulations, 2026” which will come into effect from January 1, 2027.

Interconnection in telecommunications refers to the technical, operational, and commercial arrangements that connect two or more telecom networks, allowing telecommunications traffic to flow between them and enabling users of different service providers to communicate seamlessly, according to an official statement.

The amendment modernises the existing interconnection regulatory framework to align with contemporary network architectures and facilitate a transition from the existing interconnection at Long Distance Charging Area (LDCA) and Short Distance Charging Area (SDCA) level to the Licensed Service Area (LSA) level of interconnection.

The shifting of traffic to LSA-level POIs would simplify routing and support more efficient management of scarce numbering resources, and would also result in benefits such as lower latency, and enhanced service reliability, according to the official statement.

Existing traffic, in terms of Minutes of Usage (MoUs), at the LDCA/SDCA-level points of interconnection (POIs) will be migrated to LSA-level POIs within three years, in a phased manner. Thereafter, all traffic will be handed over or taken over at the LSA or Service Area level POIs.

The amendment regulations provide for establishment of IP-based interconnection by service providers. All new interconnections established after these regulations come into force will be IP-based interconnections.

All existing POIs working on E1/TDM-based interconnection will be migrated to IP-based interconnection within a period of three years, in a phased manner. The migration to IP-based interconnection improves bandwidth efficiency, call quality and end-to-end call performance.

For IP-based interconnection, maximum call-handling capacity at a POI would be determined having regard to the concurrent session-handling capability and link bandwidth, while maintaining the desired Quality of Service in accordance with the TRAI’s relevant Regulations.

A specific regulatory framework has been introduced for the surrender of POIs. Earlier, the regulations had only the provision of “disconnection” of a POI, which is for stoppage of exchange of traffic at the POI. This is a step taken by a service provider for reasons attributable to the other service provider, in exceptional circumstances arising out of differences between them.

On the other hand, the process for surrender is intended for voluntary surrender of a POI by a service provider for its own operational requirements, such as on account of reduction in traffic, withdrawal of services from an area or re-routing of traffic, thereby improving financial efficiency.

The existing bank guarantee framework has been retained; however, the validity of bank guarantees furnished on reassessment, and the interval for such reassessment, have been extended from six months to 12 months. A revised methodology has also been introduced for determining the ceiling on bank guarantees for POIs, including IP-based interconnection.

A specific provision has been introduced to address delayed payment of interconnection charges or interconnection usage charges. The rate of interest shall be mutually agreed between service providers, subject to a ceiling of the State Bank of India’s one-year Marginal Cost of Funds-based Lending Rate (MCLR) plus two percent.

The amendment regulations prescribe reporting requirements for monitoring the shifting of traffic from LDCA/SDCA-level POIs to LSA-level POIs, and migration from E1/TDM-based to IP-based interconnection.

For effective implementation of the regulations, a graded financial disincentive framework has been prescribed for contravention of provisions of these regulations. This revision makes the enforcement of the regulatory framework more effective, proportionate and commensurate with the nature and seriousness of the contraventions covered under these Regulations.

The provisions for interest on delayed payment, reporting requirements, and financial disincentives will enable effective enforcement of the regulations.

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