The Department of Telecom is likely to disallow the transfer of mobile subscribers from Loop to Airtel’s network in Mumbai. According to senior DoT officials, Loop will soon be told to inform its subscribers to move out to any operator of their choice through Mobile Number Portability.

This follows telecom regulatory authority TRAI’s recommendation that since Loop’s licence is set to expire in November, the DoT must take a view on the deal in the interest of consumers. In June, TRAI had written to the DoT saying that the transfer of subscribers should be allowed only through the mobile number portability route. Airtel had announced that it would acquire Loop Mobile’s three million subscribers in Mumbai along with its infrastructure, that is 400 towers.

Unclear legal view

According to the regulator, subscribers’ consent has to be taken before they can be switched to another operator’s network.

However, the DoT’s initial view was in favour of allowing the deal on grounds that there was no bar on a slump sale under the existing licence conditions.

But no final decision was taken due to TRAI’s opposition.

The matter was referred to the legal advisor who opined that the ₹700-crore deal between Airtel and Loop can go ahead if there is no ban on a slump sale in the telecom licence conditions.

The problem is that the legal advisor did not give a clear-cut view and left it to the DoT to interpret the licence conditions. According to DoT officials, though there is no bar on slump sale and licence conditions make it mandatory for operators to inform subscribers at least 30 days before services are shut down.

Loop Mobile’s 20-year licence expires in November and the company was unable to win back spectrum to continue services. Airtel, on the other hand, won spectrum in Mumbai in the last auction round.

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