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New Regulations Expected For OTT Service Providers


With the bill known as ‘law against disinformation’,  there are several provisions specifically related to the Law on the Regulation of Internet Broadcasts and Prevention of Crimes Committed through Such Broadcasts (“Law No. 5651”) and the Press Law. The amendment proposals related to the Law No. 5651 and the Press Law have been on the agenda for a while of the publication of the bill.

In addition to these issues discussed widely, with the bill, ‘over the top’ (OTT) services are also planned to be included in the scope of the Electronic Communications Law No. 5809 (the “ECL”). Although there may be some changes in provisions of the bill due to further studies by the committees at the parliament, the bill is expected to be enacted as is or with minor changes. In the current draft of the bill, there is no interim period envisaged for OTT service providers and it is understood that the lawmaker intends the obligations (especially the authorization requirement) be enforceable as soon as the bill is enacted. Therefore, it is important for OTT service providers to conduct certain studies for the upcoming regulations in advance.

Except for certain provisions related to content providers and hosting providers, there are not any regulations applicable to all internet-based communication services known as OTTs and it has been agenda of the regulator to cover these services for the last 15 years. It has been emphasized that although there have been extensive obligations applicable to similar services of operators subject to the ECL, there is no general regulations applicable to OTT services and there are no needs for additional investment or no infrastructure costs for such services to be provided in Turkey. It has been argued that this difference cause difficulties for the operators to compete with these services. Especially with regard to the OTT services provided with the numbers included in the national numbering plan (VoIP etc.), authorization requirement is still one of the issues legally controversial.

The operators subject to supervision of the Information and Communication Technologies Authority (“ICTA”) are required to obtain the authorization appropriate for their services and to comply with the corresponding administrative obligations. Briefly, being a telecom operator in Turkey requires establishing a company in Turkey, having a certain infrastructure, and making other investments (including but not limited to investments related to physical presence and human resources etc.). On the other hand, OTT services are being considered as value added services provided through software based on internet service obtained by individuals independently although they were also covered with the broad ‘electronic communication’ definition under the ECL considering the nature of the relevant services but they are not regulated until now.

The increasing use of OTT services for communication thanks to faster internet services also substantiates the need to regulate OTT services. In this respect, crucial amendments are on the agenda with regard to the OTT services with new articles planned to be added to the ECL.

Authorization Requirement

In case that the bill is enacted as is, OTT services will be included in the scope of the ECL. In this respect, OTT service is expected to be defined as ‘interpersonal electronic communications services within the scope of audio, visual, written communications provided to the end users or subscribers having internet access, independently from the operators and internet services, through a publicly available software’. In this respect, OTT service providers will be obliged to be authorized through their fully authorized representatives, which they incorporated as joint stock companies or limited liability companies in Turkey.

Even though all the service providers within the scope of the definition is required to be authorized, secondary legislation may also be expected to be implemented especially for interpretation or clarification of certain elements (especially the phrase ‘interpersonal electronic communications services’) mentioned in the definition. The definition in the bill may also be criticized as it is not clear enough and it should also give a room for possible exemptions from envisaged obligations. European Union (“EU”) Directive No. 2018/1972 known as the European Electronic Communications Code defined ‘interpersonal communications services’ specifically and did not include OTT services enabling interpersonal and interactive communication as a minor ancillary feature linked to another service.

With regard to the definition for ‘social network providers’ added to the Law no. 5651, with interpretation, ICTA clarified that the platforms that provide social interaction related content with as a secondary and additional service can be deemed to be out of the scope of the relevant definition. It can be discussed that such an interpretation might be made for OTT services as well by ICTA with their secondary legislation. On the other hand, although EU Directive acknowledges that it is not appropriate for such services to be subject to a general authorization regime, authorization requirement stipulated under the bill is being criticized as a burdensome obligation which is not suitable to nature of these services. Moreover, definition and authorization obligation under the bill does not give an authority to ICTA to narrow the scope of the definition by providing certain thresholds.

As the new regulations seem to require authorization to be made through representatives incorporated as a company, this also refers to a legal regime different from regulations related to appointment of legal representatives and general authorization regime applicable to the operators. With the secondary legislation, it is expected to be clarified how authorization will be made and what the role of the representatives in Turkey will be.

Reporting Obligations

In accordance with the proposed amendments to the ECL, OTT service providers may be obliged to notify ICTA within certain periods determined by ICTA about number of active individual and business users in Turkey, number and duration of voice calls, number and duration of video calls, number of instant messages and other information to be determined by ICTA.

ICTA may issue secondary legislation and take resolutions to clarify the scope of the service provides to be subject to these obligations and applicable notification periods. It may be no surprise that the relevant reporting obligations may be heavier for number-based service providers (including providers services through VoIP) and platforms having significant number of subscribers/users.

Other Obligations

ICTA will be able to regulate OTT services with broad authority. With the enactment of the bill, all the OTT service providers offering their services in Turkey will be obliged to comply with further regulations of ICTA. By taking into account the reasoning of the bill, it is expected ICTA to impose obligations on consumer rights, personal data protection (including restrictions on cross-border data transfer) and service quality as well as further reporting obligations and financial obligations.

Sanctions

OTT service providers failing to comply with the authorization requirement and other obligations of ICTA may be subject to an administrative fine amounting from 1 million Turkish Liras to 30 million Turkish Liras pursuant to the bill. In addition, as stipulated under the bill, if the administrative fine imposed by ICTA is not paid in due time and the obligations arising from the regulations are not satisfied by the relevant OTT service provider upon ICTA’s notice, ICTA may decide to reduce the internet traffic bandwidth of the relevant OTT service provider up to 95% or block access to the relevant application or website.

In conclusion, the effects of the mentioned amendments that might substantially affect the business model of the global actors will be controversial. On the other hand, the sanctions to be applied may raise further discussions as long as they also affect communication rights of users. We recommend that the upcoming regulations about the OTT services be closely followed up by the relevant service providers.

Special thanks to Merve Arslanhan for her contributions.

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