ICTA Requested Public Consultation On The Amendments To The Authorization Regime In The Electronic Communications Sector

The Information and Communication Technologies Authority ("ICTA") announced draft amendments to the authorization regime in the electronic communications sector on December 5, 2019, and published it for public consultation.¹ The draft documents published by ICTA are as follows: (i) Draft Regulation Amending the Regulation on Authorization in the Electronic Communications Sector ("Draft Amendment"),² (ii) Draft Notification Form, (iii) Draft Application Form for the Right of Use, and (iv) Draft Regulation on Authorization Periods and Competency Controls ("Draft Regulation on Authorization Controls"). The draft documents were published on ICTA's official website for 30 (thirty) days, and ICTA requested all stakeholders to submit their opinions on the draft documents by January 6, 2020.

ICTA's proposed amendments to the legislation focus, in particular, on the following issues: (i) requirements for authorization applications, (ii) review of applications regarding the right of use, (iii) administrative fees that each operator pays annually, and (iv) the operators' rights and obligations. The Draft Amendment includes the following requirements for the authorization applications:

• The applicants should not have been convicted of any criminal offenses regarding cybercrimes, crimes against national security, or the constitutional order and functions,
• Except for offenses of negligence, the applicants should not have been convicted of any of the crimes specified in Article 2 of the Draft Amendment and sentenced to a term exceeding five years.³ (Furthermore, there should be no pending investigations or criminal proceedings against the managers of the operator regarding establishment, operation and management of electronic communication facilities in violation of the provisions of Article 9 of the Law on Electronic Communications No. 5809),⁴
• The applicants should submit the information and documents requested in the relevant notification and/or required by the right of use application form. These may include:
• 1. information on the premises of the headquarters of the company, additional premises and facilities for providing services,
  2. number, qualifications, professional, technical and physical competence of the personnel or executives of the relevant company.

Furthermore, according to the Draft Amendment, if an operator does not provide services for two (2) years, which shall be determined based on the number of its subscribers, traffic information, net sales and other similar criteria, ICTA will cancel the operator's authorization. This article will be effective as of two years following publication of the Draft Amendment, if published as is.

The Draft Amendment also provides a transitional article for meeting the application requirements introduced by the Draft Amendment, known as Provisional Article 11 of the Draft Amendment. Accordingly, all operators with an authorization or the right of use must apply to ICTA by December 31, 2022, with the requested information and documents indicated above. If the relevant operators do not apply to ICTA within the said period, ICTA may cancel the relevant operators' authorizations.

According to Article 4 of the Draft Amendment, ICTA's notification to the applicants with incomplete documents no longer has to be provided in writing. Moreover, if an operator's notification form has any nonconformity or deficiency, they will not directly be subject to administrative fines or other sanctions (Article 3 of the Draft Amendment). The Regulation also sets forth certain changes to the deadlines for examination of the applications regarding the right of use (Article 4 of the Draft Amendment).

Furthermore, there are significant changes with respect to the annual administrative fees that the operators pay, based on their net sales in the income statement for the previous year. Accordingly, ICTA initially sets a base limit for the annual administrative fee in the amount of 10,000 Turkish Liras. The base limit is calculated by increasing the revaluation rate each year in accordance with the Tax Procedure Law No. 213. This procedure will be applicable for the net sales gained after January 1,2018, according to Article 5 of the Draft Amendment.

As for the rights and obligations of the operators, all operators with an authorization should seek and receive permission from ICTA prior to any transfer of shares that leads to a change of control. Additionally, if an operator does not renew its authorization, the provisions as to cancellation may become applicable and ICTA is empowered to cancel their authorization, according to Article 7 of the Draft Amendment.

On the other hand, the Draft Regulation on Authorization Controls revokes the authorization periods that are already defined in the regulation on the definition and scope of electronic communication services, networks and substructures. ICTA determines new periods for authorization and competency controls. If a company has an authorization through notification, it will be subject to competency controls after three (3) years of the said authorization, under Article 2(3) of the Draft Regulation on Authorization Controls. Moreover, the renewal periods for the operators whose authorization has expired could be designated as up to fifteen (15) years. The Draft Regulation on Authorization Controls also provides a timetable regarding authorization renewal periods and competency controls. Finally, concerning the operators that already possess an active authorization, if the beginning of the renewal period or the period for calculating the average number of employees with an undergraduate degree is before June 6, 2020, the periods provided under the regulation should be calculated based on June 6, 2020. On the other hand, the Draft Regulation on Authorization Controls sets the last date for competency controls and the renewal period of the authorizations as December 31, 2022, for all operators with an authorization.

This article was first published in Legal Insights Quarterly by ELIG Gürkaynak Attorneys-at-Law in March 2020. A link to the full Legal Insight Quarterly may be found here

Footnotes

1. See https://www.btk.gov.tr/kamuoyu-gorusleri/elektronik-haberlesme-sektorune-iliskin-yetkilendirme-mevzuatinda-yapilmasi-planlanan-degisikliklere-iliskin-kamuoyu-goruslerinin-alinmnasi (last accessed on December 30, 2019).

2. See https://www.btk.gov.tr/uploads/pages/elektronik-haberlesme-sektorunde-bazi-duzenlemelere-yonelik-kamuoyu-gorusu-alinmasi/elektronik-haberlesme-sektorune-iliskin-yetkilendirme-yonetmeligi-nde-degisiklik-yapilmasina-dair-yonetmelik-taslagi.pdf (last accessed on December 30, 2019).

3. Offenses committed against privacy and the sphere of private life, summary and aggravated embezzlement, corruption, bribery, theft, fraud, forgery, misconduct in public office, abuse of confidence, fraudulent bankruptcy and concordat, smuggling crimes, conspiracy to rig public tenders and procurements, usury, money laundering, tax evasion or participation in tax evasion.

4. See https://www.mevzuat.gov.tr/MevzuatMetin/1.5.5809.pdf (last accessed on December 30, 2019).

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