The Hon. Kathiravelu Shanmugam Kugathasan

¶ 01 Hon. Deputy Chairperson of Committees, I wish to place before this House my views on amending the Sri Lanka Telecommunications Act, No. 25 of 1991. The Sri Lanka Telecommunications (Amendment) Act, No. 39 of 2024 is the most significant change to the country’s telecom regulatory framework since the 1991 Act. For over three decades, Sri Lanka’s telecom sector functioned under a law designed for a state-owned monopoly, and it failed to address the new digital environment, broadband, and the convergence of information technologies.

¶ 02 If we analyse the new features of this Amendment in detail, it transforms the TRCSL from a mere licensing authority into a modern market regulator. Expanding the Commission’s powers and updating technical standards are central themes.

¶ 03 The 1991 principal Act focused primarily on service providers to end-users. However, Section 17 of the Amendment brings telecommunications infrastructure service providers into regulation. Companies that provide towers, ducts and terrestrial facilities will now operate under the Commission’s direct supervision.

¶ 04 Section 5 introduces new governance tools, empowering the Commission to study market dynamics and conduct market analyses to understand competition. Crucially, the Commission can intervene to prevent or address the emergence of “Significant Market Power.” This will help detect anti-competitive conduct that could stifle innovation.

¶ 05 The introduction of Section 6 establishes a transparent, evidence-based tariff regulation framework, requiring tariffs to be impartial and cost-oriented. The law indicates that subsidies will generally be removed. Providing services without an approved tariff plan can attract fines up to ten million rupees.

¶ 06 Section 10A strengthens the management of scarce national resources like radio spectrum and telephone numbers, enhancing consumer choice. The Commission is empowered, in line with International Telecommunication Union guidance, to allocate spectrum and manage numbering plans. This will facilitate number portability, allowing consumers to switch providers without changing their number.

¶ 07 Under Sections 357 and 358, the Commission can mandate infrastructure sharing to reduce resource wastage, ensuring that a provider shares towers or infrastructure with others. The Commission will also advance social policy goals to ensure service availability nationwide. Given Sri Lanka’s location, strong measures are provided to protect submarine cables, including establishing a National Submarine Cable Protection Committee. Those damaging submarine cables may face fines up to 100 million rupees or imprisonment up to ten years.

¶ 08 Comparing in detail the Amendment with the 1991 Act, the move from Act No. 25 of 1991 to this Amendment shifts Sri Lanka’s telecom sector from administrative control to a market-driven model. The earlier framework centred on an “Authority” with focus on administrative controls. The Amendment strengthens the Commission as a composite body with technical, economic and social powers. The principal Act focused only on operators; the Amendment addresses both operators and infrastructure providers.

¶ 09 Previously, tariffs were set under ministerial oversight. The Amendment bases tariff-setting on legal economic principles. Sanctions under the old law were outdated and insufficient to deter large firms. For example, the fine for operating without a licence was only Rs. 10,000–50,000. The Amendment empowers the Commission to impose administrative penalties from Rs. 10 million to Rs. 100 million. While the principal Act gave general consumer protection, the Amendment adds number portability and quality monitoring.

¶ 10 Despite these advances, the Amendment has faced criticism from civil society and human rights advocates. Critics note that making the Commission’s Chair the Secretary to the Ministry could compromise independence. They also argue compelling private firms to share infrastructure they built with their own investment could violate Article 16 of the Constitution.