Audiotex Service Regulation, 2004



20th SEPTEMBER, 2004


S. R. O. 797(I)2004–In exercise of the powers conferred under Clause(O) of Sub-section (2) of Section 5 of the Pakistan Telecommunication (Re-organization) Act, 1996 (Act XVII of 1996), the Authority is pleased to make the following Regulations:



1.          Short title and Commencement. — (1) These Regulations may be cited as Audiotex Service Regulation, 2004.

(2) These Regulations shall come into operation at once.

2. Definitions. In these Regulations unless the Context or Subject otherwise requires:

(a)        “Act” means the Pakistan Telecommunication (Re-Organization) Act, 1996;

(b)        “Authority” means the Pakistan Telecommunication Authority established under Section 3 of the Act;

(c)        “Audiotex Service” means a value added Telecommunication Service that enables telephone subscriber to access a computer set-up established by a licensee for obtaining information of sorts including recorded entertainment programs at tariffs depending upon the type of information obtained;

(d)        “Company” means local Loop and Long Distance International Telecommunication system operator and service provider;

(e)        Competitive Services” means the Telecommunication/ value added services that may be provided by two or more Licensees;

(f)         “Gross revenue” means turnover or gross income exclusive of trade discount, shown on invoice of bills, derived from sale of goods or from rendering, giving or supplying services or benefits or from execution of contracts, for the licensed services or business;

(g)        “Information” within the special context of teleprocessing, information is deemed to mean any transmission of signals via communication channels;

 (h)       “Intelligence” means any speech, sound, data, signal, writing, image or video;

(i)         “License” means an authorization granted by the Authority for the establishment, operation and maintenance of Audiotex Service;

(j)         “Licensee” means the grantee or holder of a license;

(k)        “LDI operator” Long Distance and International fixed line telecommunication operator;

(l)         “Person” means any individual, partnership, association, joint stock company, joint venture, trust or corporation;

(m)      “Public Switched Telephone Network” means a Telecommunication system, which allows intelligence to be switched between members of the public;

(n)        “Public Telecommunication Operators” means entities licensed by the Authority to provide basic telephone service;

(o)        “Regulation” means the Regulation made under the Act;

(p)        “Service” means a set of functions/services offered to a user by a Licensee; and

(q)        “Terminal Equipment” means any apparatus directly or indirectly connected to any network termination point and used for sending, processing or receiving intelligence.

3.          Grant of License. — (1) The licensee shall provide Audiotex Services in Pakistan subject to terms and conditions contained in the Act, the Rules, the Regulations and the License issued thereunder.

(2) The license may be issued within seven days, after the applicant has fulfilled all the formalities.


Amendment, Renewal and Termination


4.          Term of the license. —The license under these regulations shall expire on the fifteenth (15) anniversary of the effective date, unless renewed or extended by the Authority prior to that date.

5.          Extension of the license. —The licensee may extend the terms of the license upon application to the Authority for an additional fifteen (15) years period provided the licensees performance during the license period remained satisfactory.

6.          Termination of the license. —The license shall remain in force in accordance with its terms until one of the following events occur, which shall constitute an event of termination:

(a)        Failure of the licensee to provide service to end-users within twelve (12) months of issuance of the license by Authority;

(b)        Continuous interruption of service for a consecutive or combined period of ninety (90) days over any six (6) month period; provided that the interruption is not a result of force majeure ; and

(c)        Bankruptcy, filing of any insolvency proceeding by the licensee or adjudication of the same in favour of creditors if such proceeding is filed against licensee, any proceeding or assignment of assets for the benefit of creditors, or any state of licensee which may be considered “insolvency” under the laws of Pakistan.

7.          License Fee. — (1) The licensee shall pay the following amounts to the Authority, —

(a)        Application fee Rs. 500/-(Five hundred only);

(b)        Evaluation fee Rs. 5000/-(Five thousand only);

(c)        Initial License fee Rs. 500,000/- (Five hundred thousand only);

(d)        Annual License Fee :

(i)         25% of the initial license fee plus 1.5% gross revenue of preceding fiscal year from licensed services; or

(ii)        50% of initial license fee or whichever is higher.

(2) The licensee shall make payment of the annual license fee to the Authority in arrears but not later than 120 days of the close of financial year of the licensee.

 (3)       The licensee shall be liable to pay a penalty @10% on the outstanding amounts if the dues are not paid within due date.

(4)        All payments to the Authority shall be made through crossed bank draft or pay order or credited to the Bank Account of the Authority as specified by the Authority.

(5)        The Annual License Fee shall be paid not later than ninety (90) days after the closing date of the fiscal year of the licensee, according to its audited annual account. The licensee shall be responsible for the submission of annual financial statements indicating all business conducted in Pakistan during the preceding fiscal year and this statement shall be submitted to the Authority by the last day of the first quarter of the following fiscal year.


General Conditions of the License

8. Operation of the License.—(1) The licensee shall complete formalities (implementation plan, phasing plan, proposed tariff plan, details of equipment and services, quality assurance and other details, etc) within ninety days of the issuance of the license.

(2)        The licensee shall be responsible to install and have necessary technical, financial, managerial and other resources to ensure the provision of the services specified in the license and to implement the different plans approved by the Authority.

(3)        The licensee shall comply with the Authority’s directions for modernization of its system or for replacement, improvement of any apparatus, equipment used by it within the time prescribed by the Authority in this regard.

(4)        At any time after commencement of the operation, if any information mentioned above changes, the licensee will be under obligation to provide updated information 90 days prior to such a change.

(5)        The licensee shall ensure that the services established by him do not cause any damage or interference to any system and network of the company or any other telecommunication system and telecommunication service operator licensed by the Authority. The licensee shall also ensure that the circuits established by him operate strictly according to the recommendations laid down by the ITU.

(6)        The license shall, in the operation of its service comply with all the provisions of the Act and the Rules and the Regulations made thereunder and as upgraded/ modified on as required bases. In case of contravention of any provision of the Act or the Rules and the Regulations made thereunder or any term or condition of the license, the Authority may initiate action under Section 23 of the Act.

(7)        The licensee shall provide whatever information required about its licensed operation by the Authority as and when asked for, and appear before the Authority whenever called for to help investigate any matter concerning operation of its service. Delay/non-provision of information will be considered as violation of the license conditions.

(8)        The licensee shall not enter into any agreement or arrangements, which shall in any way, prevent or restrict competition in relation to the operation of any Telecommunication Service licensed by the Authority.

(9)        The licensee shall make satisfactory arrangements for inter-working between other licensed systems allowed to operate concurrently and in parallel, and shall make suitable accounting arrangements with the other licensees directly. The licensee shall execute separate agreement (s) with other licensees in this regard and shall submit to the Authority copy of such agreement (s) within ten (10) days of its execution.

(10)      The licensee shall not discontinue / terminate / wind-up its service or share of its service without prior approval of the Authority. A one year notice will be required to be served by either party to wind-up/ terminate this service and after settlement of all claims / obligations / accounts with other licensed data network operators, the Company, its customers and the Authority.

9. Monitoring. — (1) The Authority, or its authorized representative, shall supervise, monitor and regulate the operation of Audiotex Service/System.

(2)        The licensee shall provide at its own cost and set up suitable equipment at the premises as the Authority may indicate, enabling security agencies or Government to monitor the traffic, billing, and quality of service or any other aspect as the Authority may deem appropriate.

(3)        The Authority shall have the right to monitor all the traffic that goes through the system for quality of service purposes. The licensee shall ensure complete monitoring rights to theAuthority including prospective Interconnection Establishment/Company.

(4)        The Licensee shall furnish to the Authority, detailed information regarding links utilized, annual reports or any such information as may be required by the Authority.

10. Accounting and Auditing. —The licensee shall maintain financial records and books of accounts in accordance with the laws of Pakistan. The licensee shall submit audited financial statement and summary of accounts to the Authority within three months of the closing date of financial year of the licensee. The financial statements and notes thereon shall show, apart from other, following information about the licensed Audiotex Service: __

(a)        Gross revenue (total amount accrued and billed/invoiced to the customers);

(b)        Description and amount of each cost element/item;

(c)        Gross profit, operating profit, profit before and after tax, carried forward profit/(loss);

(d)        Description and amount of each type of tax, duty, levy paid and payable to the Government of Pakistan; and

(e)        Description and amount of fees, dues/paid and payable to the Authority.


11. National Security. — (1) For reasons of national security and for the circumstances described in section 54 of the Act, the Federal Government may initiate action under the law.

(2)        The licensee shall comply with the requirements of national security and with other directions given by the Authority or its authorized nominees from time to time, for the purpose, and the same shall be binding on the licensee.

(3)        Notwithstanding anything contained in the license if subsequent to the issuance of the license at any time it come to the notice of the Authority that the licensee is undermining the national security or its operations are a national security risk, the license shall be deemed withdrawn automatically.

(4)        If the license stands withdrawn under Sub-Regulation (3), the licensee shall be informed, in writing, as soon as possible but not later than (14) days of the withdrawal.

(5)        The time license stands withdrawn, all the rights and liabilities granted under the license will cease and the said licensee status will revert back to an applicant who’s application has been refused by the Authority.

(6)        Services shall not be set-up in security sensitive areas. Such modes if covering places of security importance shall be got cleared from respective security related requirements.

(7) In case of war, emergency or internal strike, the Authority is empowered to suspend or close the service offered by the licensee.

12.        Inspection. — (1) The licensee shall allow inspection by an authorized representative of the Authority of any premises or telecommunication equipment and furnish to the Authority such information as may be required by it.

(2) The licensee shall make books and records of accounts available for inspection by the Authority. The licensee shall file all such accounting information with the Authority on an annual basis, beginning first financial year closing from the date of the license, in such form and containing such information as provided in these Regulations and as may be prescribed in writing by the Authority and required by the laws of Pakistan.


Specific Conditions of the License

13.        Technical Standards. — (1) The licensee shall comply with all technical standards set and imposed by the Authority from time to time, and shall submit to the Authority its plans for signalling, transmission, switching and synchronisation for the written approval by the Authority.

(2)        The licensee shall comply with related International Standard for the services provided under the license for Audiotex service equipment.

(3)        The licensee shall, within ninety days of issuance of the license, submit complete details about origin, make, type and specification of equipment and information about services planned by the licensee for approval of Authority or its authorized nominees.

(4)        The licensee shall install equipment employing state-of-the-art technology, fully compatible with the existing telecommunication system infrastructure of the country. The licensee shall ensure that a high grade of service is continued to be provided to the users.

(5)        On completion of installation, licensee shall invite experts of Authority for test and certification of quality and for approval of start of service. This approval to start the service shall be accorded, if terms and conditions of the license have been fulfilled and installation is found technically suitable for start of service.

(6)        The licensee may employ foreign experts to assist in establishment, operation and maintenance of licensed system and services in accordance with the relevant laws. The number of such foreign experts shall reduce gradually. After three years of operation of service foreign experts shall work only on highest management positions. The bio-data of foreign experts, if employed, shall be submitted prior to arrival for approval by the Authority sixty days in advance.

14.        Quality of Service. — (1) To the extent practicable, the licensee shall provide Video Conferencing service on 24 hours per day, seven (7) days per week basis, at any location in the service area without interruption except as necessary to perform routine maintenance during periods likely to result in the minimum disruption of service, in accordance with applicable international technology and operating standards (Performance parameters to be agreed upon). Such information shall be so advertised at least 24 hours in advance for general information.

(2) The Service Provider shall submit details in relation to quality assurance and grade of service plans to the Authority for approval within ninety days of award of the license.

15.        Quality Measurement and Control.—The licensee shall within 180 days of the date of issuance of the license establish a quality measurement and control system for the Audiotex service, which shall include those standards, referred to in Regulation 13 and 14, and other parameters related to the standards of quality of service to be provided to the end-user.

16.        Events Initiating Investigations by the Authority for Failure to Perform.—The Authority is empowered by law to commence an investigation concerning the licensee’s performance when one of the following events occurs: —

(a)        Failure to comply with the service provision and regulatory/technical standards requirements;

(b)        Failure to comply with any of the performance obligations set forth in the license;

(c)        Partial or total interruption of the Audiotex Service for a continuous period of 72 hours in the service area;

(d)        When the licensee fails to comply with the quality requirements of the license;

(e)        When the licensee knowingly or negligently violates the confidentiality and secrecy provisions of the license;

(f)         When the licensee uses, installs or connects to the PTO’s terminals or equipment which has not been approved by the Authority, or damages

in any way the “PTO” network by use, installation or interconnection of equipment which is not approved by the Authority;

(g)        When the licensee provides telecommunications services, which are not authorized by the license;

(h)        When the licensee fails to provide information to the Authority as required by the laws of Pakistan and the license, and when the licensee fails to permit or impede inspections by the Authority as permitted by the laws of Pakistan as they exist or come into force from time to time;

(i)         When the licensee violates these regulation as they exist or come into force from time to time;

(j)         When the licensee construct or installs infrastructure not authorized by the license;

(k)        When any other violation of the terms of the license is brought to the notice of the Authority; and

(l)         Failure of the licensee to pay agreed license fees, and annual renewal fees. PART-V

Relations with Customers

17.        Contract of Services. —The licensee shall provide Audiotex service in accordance with the terms and conditions of the license to end-users.

18.        Tariff and Billing. — (1) The tariff of Audiotex service is forborne till such time the Authority feel necessary to regulate.

(2) The licensee shall publish rates and tariffs for the use of each service. For any revision in the tariff, the licensee shall submit the case with full justification, to the Authority for approval and the decision of the Authority there on shall be final and binding on the licensee.

Provided that the licensee shall, in turn, notify his users about any change in the rates thirty days before the enforcement of new rates, which shall be given adequate publicity.

(3)        In case of any dispute on payment of dues, the decision of the Authority shall be final and binding on the licensee and the company.

(4)        The licensee shall sign billing, collection and revenue sharing agreement with the company. The revenue shall be shared between company and the licensee as a result of collections of Audiotex revenues as per approved tariff. The revenue sharing shall be mutually agreed between company and the licensee from time to time.

(5)        The licensee and the Company shall prepare monthly accounts of billing statements from their own systems for settlement and mutual reconciliation. The settlement of account shall be done on monthly basis and also reconciled quarterly.

(6)        The licensee may either provide a uniform tariff service on nation wide basis through one platform (licensee’s Audiotex equipment) based in any major city of Pakistan. In that case subscribers of the Company shall have access to licensee from anywhere in the country irrespective of distance from the licensee system at a uniform tariff or the licensee may start his operation in any one major city initially and shall have to provide services in at least two major cities of Pakistan within one year of start of the service. The services at other places in Pakistan shall be expanded in a phased manner to cover the whole country as per direction of the Authority.

(7)        The licensee may either provide Audiotex premium rate and toll free services across the country irrespective of the distance at a uniform tariff, or the company shall plan three geographical zones for the Audiotex service across the country.

(8)        The tariff of the service shall be subject to the approval of Authority.

19.        Publication of Tariffs. — (1) Whenever there is change in tariff, the licensee shall make the new tariffs readily accessible to general public and publish them in at least two (2) newspapers with significant circulation throughout Pakistan fourteen (14) days before they are put into effect.

(2) The licensee shall send a copy of the publication or such part or parts thereof as appropriate to the Authority or to any person who may request such a copy.

20.        Complaint System. — (1) The licensee shall within 180 days of the date of issuance of the license establish an efficient and easy-to-use system to receive, process and respond to complaints or claims by end-users or other affected parties related to the Audiotex service.

(2) The licensee shall maintain a register of complaints and produce the same as and when required by the Authority within that time.

21. Code of Commercial Practice. —The licensee shall provide to each end-user during the first six months of its provision of the Audiotex service, a code of commercial practices, practiced internationally and approved by the Authority.


Relation with Other Operators

22. Interconnection with the Network. — (1) The licensee shall where necessary interconnect its own system with Company network. Authority shall facilitate in arranging such agreements if required by the parities. This interconnect agreement shall be signed before commencement of service. The agreed and signed copy shall be provided to the Authority.

(2)        The company shall try to modify its systems in respect of any interfaces/ software/ hardware changes / updates, etc., on mutually agreeable terms whenever required by the licensee. All disputes or differences between the licensee and the company shall be referred to the Authority whose decision shall be final and binding on both the parties.

(3)        The licensee shall install its equipment in its own building / premises unless a mutually agreeable arrangement can be settled between him and the company.

23. Interconnection Agreement.—The interconnection agreement shall include, without limitation, the following:

(a)        The method to be adopted to establish and maintain the connection;

(b)        The connecting points of the network in which the connection is to be made;

(c)        The necessary capacity to ensure reasonable quality of the signal, taking into account overall capacity of the interconnecting network; and

(d)        The way to ensure that any signal is received with a quality consistent with the recommendations of the International Telecommunication Union (ITU).

24.        Capacity and Quality for Interconnection. —The licensee shall meet any required installation capacity and demand of interconnection in services in accordance with the technical standards approved by the Authority.

25.        Settlement among the Licensee and the Company. —The licensee and the company shall agree on tariff (s) structure for calls that enter into each other networks. In case of non-agreement either party can refer to Authority for issuance of determination.

26.        Collection and Revenue Sharing. —The Company shall honour its obligations under the interconnection agreement (s) to collect and pay the revenue share to licensee.

27.        Responsibilities of the Licensee. —The licensee shall be responsible: __

(a)        for provision of necessary interface equipment to coordinate functioning with the company’s network;

(b)        for ensuring that protective management, monitoring and trouble shooting is performed in consultation with the company, in order to offer maximum reliability and up-time of service to the users;

(c)        for ensuring that appropriate measures are taken in respect of congestion management in the service so that the users have minimum level of difficulty in accessing the service;

(d)        for ensuring that a program is not launched which is likely to cause an excessive volume of access calls, without prior consultation and arrangement with the company;

(e)        for setting up a system to monitor the processing equipment and accessories capable of checking the quality of functioning of the system. The Authority may ask for the result of monitoring at any time;

(f)         for submitting plans of update and expansion of Audiotex service at the beginning of each calendar year by 30th January;

(g)        for ensuring that the subscribers are provided adequate support for use of his service;

(h)        for insuring that calls for most services, unless specifically requested , do not exceed ten minutes in duration;

(i)         for ensuring that the likely call duration and tariff for timed services is indicated to the user, and his consent obtained before the service is started;

(j)         for ensuring that programs available through his service do not mislead any person with respect to the content or cost of the service being offered;

(k)        for ensuring that the promotional material is not misleading in relation to the service actually provided;

(l)         for ensuring that the information available on his service is updated at regular intervals of time when required and should state at the beginning of the program that the following information is correct to a particular time;

(m)      for ensuring that the telephone subscribers are informed that they are not allowed to reproduce, re-distribute, re-transmit, publish, translate, transfer, or exploit, any information or other copyright material received through the service without legal authorization from the owner / service provider. Any subscriber can however, retrieve public domain information content through the service for his personal use or non-commercial re-distribution. The subscriber will be responsible for ensuring that a program / information content is in public domain;

(n)        for ensuring that the information content provided through the service are permissive in character and treatment and which does not come into direct clash with the accepted standards of morality and social values in Pakistan;

(o)        for ensuring that the text / dialogue or language transmitted through his service is not obscene, abusive or likely to;

(i)         impair accepted moral standards and social values;

(ii)        give offense, violate or infringe upon the rights of any section of the public or injure the feelings of any class of persons; or

(iii)       hurt national sentiments;

(p)        for ensuring that the service shall not create problem or shall not be unsuitable directly or in directly as to:—

(i) bring contempt to the country or its people or tends to undermine integrity or solidarity of state;

violate any provisions of the constitution of Pakistan or the relevant law of Pakistan for the time being in force; promote or support sedition, terrorism, anarchy or violence in the country;

(iv)       bring contempt to the Defence Forces, Police Force or any other institution of Government of Pakistan or to divulge any secret information relating to Defense and other services; and

(v)        contain any propaganda in favor of any foreign state having bearing on any point of dispute or against a friendly foreign state likely to impair good relations.

(q)        for ensuring that the service shall not in any way undermine Islam or ridicule, disparage or attack any religion, sect, caste or creed;

(r)        for ensuring that the service shall not glorify, vice, crime, violence, bribery, corruption or other social evils;

(s)        for ensuring that service shall not fan racial, sectarian, parochial, linguistic, regional or class hatred;

(t)         for ensuring that programs available through its service do not induce an unacceptable sense of fear or anxiety in the general public;

(u)        for ensuring that information / programs available on its service will not be used as a device for unethical practices or advice;

(v)        for ensuring that all communication related to specialized information should be conveyed in a manner that properly reflects the seriousness of the subject matter of the advice;

(w)       for ensuring that promotional material aimed at or readily accessible to an audience of minors will include statements indicating that the agreement of parents / guardians should be sought before calling the program;

(x)        for ensuring that programs, either wholly or in part, designed for an audience of young persons will not include language or reference to practices that a reasonable parent or guardian would not wish his or her child to know about;

(y)        for ensuring that all advertising will conform to the laws and applicable advertising standard of the country; and

 (z) for ensuring that no advertisement may include any obscene or indecent message or picture.

28.        Responsibilities of the Company. — (1) The Company shall make necessary arrangements to provide lines for the Audiotex circuits and to keep these lines in good working order.

(2)        The company shall provide lines for installation of the Audiotex Service within thirty days of the written request of the Licensee, wherever technically feasible.

(3)        The Company shall try to modify its system on mutually agreeable cost / terms whenever required by the Licensee.

(4)        All disputes or differences between the licensee and the company shall be mutually discussed and settled. In case of non-settlement matter shall be referred to the Authority whose decision shall be final and binding on both the parties.

29.        Sanctions. — (1) In the event that the Authority determines, after an investigation, that the licensee has committed an infraction, or that the licensee has breached the license, the Authority without prejudice to Section 23 may impose one or all of the following sanctions:—

(i) A public apology by the licensee, at its own cost for its infraction in a newspaper of general circulation in the area of service to run for two (2) consecutive days;

Temporary suspension of the benefits of the license as they flow to the licensee, or in the case of serious infractions termination or revocation, cancellation of the license, and other action authorized to the Authority in the interest of the public;

Outage credits to be given to end-users for continuous interruption of service for a period exceeding 120 hours in the service area; and

(iv) Any other sanction as may be appropriate in accordance with the laws and Regulations in force in Pakistan and applicable to the service.

PART-VII General

30.        Assignment of Rights. —The licensee shall not assign, transfer, subcontract, dispose of, or in any manner alienate the license or any part thereof, or any benefit or interest therein or thereunder without the prior written consent of the Authority.

31.        Force Majeure. —Without prejudice to their rights under the license, neither the licensee nor the Authority shall be held responsible nor suffer financial loss should his performance hereunder be delayed or prevented by circumstances of force majeure which shall include but not be limited to lockout, strike, riot, mutiny, civil commotion, fire, accident, act of God, war, government action or other reasons beyond the reasonable control of either party hereto.