Authorization Obligation is on the Horizon for OTT Services

The law, known as the 'disinformation law,' entered into force after being published in the Official Gazette on October 18, 2022.

The new period for all OTT service providers, which provide 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, has started on October 18, 2022. No transition period was foreseen for the regulations concerning over-the-network service providers (known as OTT service providers), particularly the authorization obligation.

On the other hand, since secondary regulations have not yet been issued by the Information and Communication Technologies Authority (BTK), we can say that an uncertain transition period has begun in practice.

New Obligations for OTT Service Providers

The parliament adopted the draft law's provisions for OTT service providers with minor amendments. We have previously evaluated the obligations to be imposed on OTT service providers in detail. Please click here for our detailed bulletin on this subject.

In summary, OTT service providers must comply with the following obligations:

OTT service providers must apply for authorization to BTK through their fully authorized representatives, which they incorporated as joint stock companies or limited liability companies in Turkey and be authorized by BTK. Unauthorized OTT service providers will not be able to offer services to users in Turkey.

OTT service providers may also be subject to 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. Furthermore, although the notification obligation explicitly included in the draft has been removed from the law, OTT service providers may still be obliged to notify BTK of number of active individual and corporate users in Turkey, number and duration of voice calls, number and duration of video calls, number and duration of instant messages and other information to be detrmined by BTK at such intervals as BTK may stipulate. Existing operators are also subject to similar notification obligations.

OTT service providers that fail to comply with authorization and other obligations set by BTK will be subject to administrative fines ranging from TRY 1 million to TRY 30 million (these fines may increase by 122.93% based on the revaluation rate determined for 2023). In addition, 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, BTK 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.

Expected Developments

Although the articles added to the Electronic Communications Law, particularly the authorization obligation, entered into force as of October 18, 2022, it is considered that the authorization regime applied to operators providing conventional electronic communication services is not directly applicable to OTT service providers. Otherwise, if similar obligations applicable to existing operators are also required for authorization of OTT service providers, then OTT service providers may also need to have an office in Turkey, to employ certain number of employees and to appoint an authorized representative resident in Turkey.

BTK is expected to frame obligations of OTT service providers through secondary regulations and various decisions. BTK is expected to regulate the following issues through secondary regulations and decisions:

Authorization Obligation: BTK is expected to determine which OTT service providers will be subject to the authorization obligation as well as authorization conditions applicable to them. For example, within the framework of the definition of 'interpersonal communication services' under the European Union (EU) Directive 2018/1972, known as the European Electronic Communications Law, it may be decided that where communication services are a secondary element of the main service offered, such OTT services may be deemed out of scope. It is also expected that BTK will provide a deadline for OTT service providers to apply for authorization through secondary regulations.

Other Obligations: BTK is competent to determine which rights and obligations applicable to conventional operators can also be applied to OTT service providers. In this context, many obligations, such as the notification obligation, are expected to apply to OTT service providers. BTK may also decide to apply these obligations to be applied to OTT service providers in a different way depending on nature of OTT services provided. Provisions emphasized in the draft law but not included in the enacted article may be a reference point for BTK to determine how to decide on the scope of obligations applicable to OTT service providers based on nature of their services. In this context, BTK may base its decisions by considering criteria such as whether the OTT service provider offers the opportunity to communicate with numbering sources in the National Numbering Plan, number of users in Turkey or number of daily accesses to such services. We expect that OTT service providers that offer communication services with numbers and whose number of users or daily access is above a certain threshold will be subject to more severe obligations.

Conclusion and Recommendations

As mentioned above, the law does not provide for a transition period for these comprehensive regulations concerning OTT service providers. Even if BTK foresees a transition period, it is also possible that this period will not be granted or that a period long may not long enough for OTT service providers to complete the entire compliance process. In many areas, OTT service providers are expected to be subject to similar obligations as conventional operators.

In any case, OTT service providers will need a joint stock company or limited liability company in Turkey for authorization in this new period. Therefore, we recommend OTT service providers that do not yet have a company in Turkey start the company establishment process as soon as possible.

It would also be helpful to conduct preliminary studies on which obligations may apply to OTT service providers. Analyzing the obligations imposed on operators providing traditional electronic communication services in this context and preparing for these possible obligations will accelerate the compliance process.

Tagged with: Media, Entertainment, BTK, OTT, Gün + Partners, Begüm Yavuzdoğan Okumuş, Yalçın Umut Talay