To operate lawfully, all businesses require various kinds of licenses, though there are some instances where an OSP license is not necessary. Read on to learn more!
The OSP license, established under the New Telecom Policy (NTP) of 1999, allows entities in India to offer various telecom services termed as ‘Other Service Providers’ (OSP). These services include telebanking, tele-trading, telemedicine, e-commerce, network operation centre, call centre, and other IT-enabled services. OSPs utilise telecom resources provided by authorised telecom service providers, such as Integrated Services Digital Network (ISDN), Public Land Mobile Network (PLMN), Public Switched Telecom Network (PSTN), and Telecom bandwidth. These resources must be obtained from telecom service providers holding a valid license under the Indian Telegraph Act, 1885. As per regulations set by the Telecom Commission in February 2000, OSPs are restricted to using telecom resources exclusively from authorised providers, cannot encroach upon the jurisdiction of other providers, and are prohibited from offering switched telephony services.
The Department of Telecommunications (DOT) mandates that these additional service providers, or OSPs, register as OSPs.
However, in some circumstances, obtaining an OSP license is not necessary. You can get in touch with Vakilsearch for more details; their legal professionals will respond to all of your questions and make the process hassle-free for you.
In this blog, we will talk about what an OSP license is and when it is not necessary to get one.
Types of OSP
- Domestic OSP
Within national borders, i.e., within India, domestic OSPs offer telebanking, teletrading, telemedicine, e-commerce, network operation centers, call centers, and other IT-enabled services.
- International OSP
Beyond national borders, i.e. outside of India, international OSPs offer telebanking, teletrading, telemedicine, e-commerce, network operation centers, call centers, and other IT-enabled services.
Circumstances In Which OSP License Is Not Required
The Department of Telecommunications recently released new OSP guidelines for Other Service Providers (OSP), which have eliminated the requirement for Registration for Other Service Providers (OSP). You can now simply register your Private Limited Company/LLP or Partnership Firm or obtain Shop and Establishment Registration to open your own Call Center.
The Department of Telecommunication released the New OSP Guidelines on June 23, 2021, to make operating call centres and BPOs in India easier. Several changes to OSP registration have been made following these guidelines, including,
- There will be no registration requirement for OSP centres in India, and the distinction between domestic and international OSPs has been eliminated. The businesses won’t be obliged to give the DoT bank guarantees. A bank guarantee in the amount of ₹1 crore per seat was previously required.
- Other service providers (OSPs) can now work remotely without having to deposit bank guarantees or register with the Department of Telecommunications (DoT), thanks to the department’s modified regulations.
- Due to the COVID-19 scenario, DoT earlier modified the rules for OSPs; nonetheless, the modifications are now permanent. The new DoT regulations allow OSPs to do their business from anywhere in India, including their homes.
Documents Needed for India OSP License Registration
The organisation must be a Private Limited Company in order to obtain an OSP Registration in India. Entrepreneurs who want to launch a call center, business process outsourcing (BPO), e-commerce site, or other IT-enabled services must therefore incorporate a Private Limited Company. OSP Registration requires the following documents in addition to the application in the required format:
- A Company’s MOA and AOA
- Currently Owned Shares
- List of Directors
- Appointing the Authorized Signatory: Resolution of the Board of Directors or of POAs.
- Private Limited Company’s Certificate of Incorporation Business Name and Activity
The above-mentioned documents must be sealed and certified by
- A public notary,
- Company secretary,
- Director of the company,
- Or statutory auditor.
Obtaining an OSP License in India: The Procedure
Any domestic or foreign OSP must have an OSP Registration/License, which must be issued by the Department of Telecommunications. The process to register as an OSP for both domestic and international OSPs is as follows:
- Companies eligible for OSP Registration must be registered under the Companies Act of 1956 or the Companies Act of 2013.
- To submit an application for OSP Registration to the DoT, use Form-I. On the Department of Transportation’s website, you can submit an online application for it.
- It is only possible to register for OSPs in one place. So, a business can have several OSP Registrations.
- To register multiple sites, the business should submit an OSP Registration application. The company may apply to the appropriate authorities for the remaining sites once it has received the registration certificate for the first location.
- The organisation must inform the DoT if it plans to modify or create a Point of Presence (POP). Along with the registration application process for OSPs (Other Service Providers), the processing feed must be paid.
Validity of OSP
After the date of issuance, the license remains in effect for 20 years. At the OSP’s request for renewal, the validity is extended for an additional 10 years.
However, if both parties agree, the request may be made in year 19 instead. However, the authority decides whether to grant the extension or not.
OSP License Compliance
The Annual Return must be filed within six months of the end of the fiscal year. The operations of the OSP during the prior fiscal year should be included in the return.
The continuation status of the OSP operations should also be discussed. In light of this, any company that fails to file the return for three straight years will have its registration cancelled after two years.
Conclusion
We hope that after reading this one has understood what an OSP license is and in what cases it is not required to get one.
Since obtaining an OSP license is a legal procedure, taking the help of experienced legal professionals at Vakilsearch can be the safest and most hassle-free way for your business.
FAQs
1. What services fall within the scope of the OSP License?
In addition to other IT services, license holders can offer telebanking, telemarketing, telemedicine, e-commerce, call centers, and other services.
2. Can an OSP License be transferred?
No, It isn't transferable.
3. Do I require more than one OSP License?
It depends on the setting. Every location of the company requires a separate OSP License. However, if you intend to grow, you can apply for a new license by submitting your current license and certificate of incorporation.
What types of businesses are exempt from needing an OSP license?
Certain categories of businesses are exempt from requiring an OSP license, including:
◉ Entities providing services exclusively within their own network without using the public telecom network.
◉ Companies offering IT-enabled services solely for internal use and not for commercial purposes.
◉ Businesses engaged in software development and providing services like software consultancy, design, and development, without using telecom resources for communication.
What is the cost of Other Service Providers license in India?
The cost of obtaining an Other Service Providers (OSP) license in India can vary depending on factors such as the type of services offered, the scale of operations, and any associated regulatory fees. The exact cost can be obtained by directly contacting the Department of Telecommunications or consulting a legal expert familiar with telecom regulations.
Who doesn't need an Other Service Providers license?
Businesses that exclusively operate within a single state and do not utilise telecom resources or services outside of that state may not require an OSP license. Additionally, entities providing services solely for internal use without commercial purposes, and those operating within their own network without using public telecom resources, may be exempt from OSP licensing requirements.
Are there any updates or changes to the OSP Guidelines?
Updates or changes to the OSP Guidelines are periodically made by the Department of Telecommunications to adapt to evolving technology, industry practices, and regulatory requirements. It is advisable to regularly check for any updates or amendments to ensure compliance with current OSP Guidelines.
If my business is only operating within one state, do I still need an OSP license?
If your business operates exclusively within one state and does not use telecom resources or services outside of that state, you may not require an OSP license. However, it is essential to verify this with the relevant regulatory authorities or legal experts to ensure compliance with applicable regulations and licensing requirements.
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