Regulating to build consumer trust in phone-paid services
PhonepayPlus is the organisation that regulates products or services - such as competitions, TV voting, helplines, adult entertainment, downloads, new alerts or interactive games - that are charged to users' phone bills or pre-pay accounts.

8 Procedures and sanctions

8.1  Tribunals
8.2  Permissions
8.3  Complaint investigation
8.4  Informal procedure
8.5  Standard procedure
8.6  Emergency procedure
8.7  Information provider cases
8.8  Adjudication
8.9  Sanctions
8.10 Reviews
8.11 Oral hearings
8.12 Administrative charge

8.1    Tribunals

Whenever the rules of this Part or Part 11 of the Code require the constitution of a Tribunal, then it shall consist of three members who shall be:

  • the Chairman of the Code Compliance Panel or such of the two legally qualified Panel members as he shall nominate (who shall sit as Chairman of that Tribunal),
  • two persons who shall be drawn from the lay members of the Panel and/or the Board members entitled to undertake adjudicatory functions. The selection of the Tribunal members other than the Chairman shall be carried out as the Board may from time to time decide. 

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8.2 Permissions

All applications for permission required under this Code will be considered by a Tribunal which may grant or refuse any application for permission and in granting a permission may impose any condition which it considers to be appropriate. 

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8.3    Complaint investigation

8.3.1     PhonepayPlus will consider and, where appropriate, investigate all complaints which it receives, provided that the complaint is made within a reasonable period from the time when it arose.

8.3.2     PhonepayPlus, through its Executive, monitors premium rate services. The Executive can itself initiate an investigation where there appears to be a breach of the Code.

8.3.3     During investigations, or as part of the adjudication process, PhonepayPlus may direct any service provider or network operator concerned to disclose to the Executive, subject to the confidentiality provision set out in paragraph 1.5 and within a reasonable time period, any relevant information or copies of documents. This may include, for example, information concerning:

  1. call volumes, patterns and revenues,
  2. details of the numbers allocated to a service provider,
  3. details of services operating on particular premium rate numbers,
  4. customer care records,
  5. arrangements between networks and service providers,
  6. arrangements between service providers and information providers.

8.3.4     Throughout these procedures, PhonepayPlus will deal directly with service providers and network operators. PhonepayPlus may also deal with information providers in any case in circumstances where the service provider requests that PhonepayPlus deals directly with the information provider and:

  1. the information provider:
    • accepts full responsibility for the service and/or its promotion,
    • undertakes that, in the event that a breach is established and a sanction and/or administrative charge is imposed, it will be responsible for compliance and/or payment, and
  2. the relevant service provider undertakes that, in the event that the information provider fails to comply with any sanction and/or make any payment due, the service provider will retain responsibility for compliance and/or payment in respect of any sanction and/or administrative charge that has been imposed, and will comply on demand from PhonepayPlus without any entitlement to further process, and
  3. PhonepayPlus accepts that the case is one in which it is appropriate for it to deal with the information provider. The procedure in respect of cases in which PhonepayPlus is asked to deal directly with information providers is set out at paragraph 8.5.  

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8.4    Informal procedure

In appropriate cases where an apparent breach of the Code has caused little consumer harm, the Executive may use the ‘informal procedure’. Factors including the seriousness of the breach and the service provider’s case history will be taken into account when deciding whether the informal procedure should be applied. In such cases:

  1. The service provider will be contacted and informed of the apparent breach.
  2. If the service provider agrees that a breach of the Codehas taken place, the service provider will be required toremedy the breach and accept any condition that the Executive may require. No other sanction will be imposed nor any administrative charge levied.
  3. The service provider will be sent a letter confirming what has been agreed.
  4. If the service provider disputes the breach, the standard procedure may be invoked.
  5. A record will be maintained in respect of breaches of the Code dealt with through the informal procedure. 

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8.5     Standard procedure

When the Executive receives or initiates a complaint, the ‘standard procedure’ will usually be used:

  1. The Executive will provide the service provider with all the necessary information about the complaint, including details of the service or promotional material which gives rise to the apparent breach of the Code, and will be referred to the relevant provisions of the Code.
  2. The service provider will be given a reasonable time in which to respond and to provide any information requested. This response will normally be required within five working days. In exceptional circumstances, a shorter time limit may be set but this will not be less than 24 hours.
  3. If the service provider fails to respond within the required period, the Executive will proceed on the assumption that the service provider does not wish to respond.
  4. The Executive will prepare a report, together with relevant supporting evidence, which will be placed before Tribunal which shall adjudicate upon the matter (’Tribunal’).
  5. The Tribunal may invite the service provider to make informal representations to it in person in order to clarify any matter or the service provider may request the opportunity to make such informal representations to the Tribunal.
  6. At any point in the course of a standard procedure, PhonepayPlus may inform the relevant network operator(s) of the apparent breach of the Code and direct that it withholds from the service provider any payments (relating to the relevant services) outstanding under the contract between it and the service provider. 

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8.6     Emergency procedure

8.6.1     Where it appears to the Executive that a breach of the Code has taken place which is serious and requires urgent remedy, the
‘emergency procedure’ will be used:

  1. The Executive will undertake an immediate investigation of the complaint.
  2. On completion, the Executive will notify its findings to any three people each of whom is either a member of the Code Compliance Panel or of the Board and entitled to undertake adjudicatory functions.
  3. If all three people so notified agree that there appears to be a serious breach of the Code requiring urgent remedy, the Executive will:
    1. use reasonable endeavours to notify the service provider (by phone, fax or e-mail) that the service appears to be in breach of the Code, that the emergency procedure has been invoked and that the service must be removed immediately,
    2. advise the relevant network operator(s) of the breach and direct that it withholds from the service provider any payments outstanding under the contract between it and the service provider,
    3. if the service provider cannot be contacted, or, having been contacted does not remove the service immediately, direct that the network operator(s) bar access to the relevant service(s) or number(s) forthwith.
  4. Once the service has been removed, the service provider will be provided with all the necessary information relating to the complaint and will be referred to the relevant provisions of the Code. The service provider will then be required to respond in writing within five working days.
  5. All relevant information including any response from the service provider will, in the absence of special circumstances, be laid before a Tribunal within 10 working days from the provision of the service provider’s response or as soon thereafter as is practicable.
  6. The Tribunal may invite the service provider to make informal representations to it in person in order to clarify any matter or the service provider may request the opportunity to make such informal representations to the Tribunal.
  7. The time limits set out in this Section may be extended at the discretion of the Chairman of the Tribunal if he considers that their strict application might cause injustice.

8.6.2     If, within 10 working days following the confirmation of use of the emergency procedure in a particular case, another case comes to the notice of the Executive which exhibits substantially the same characteristics, the Executive may, subject to the approval of one member of the Code Compliance Panel or one member of the Board entitled to undertake adjudicatory functions, proceed with the emergency procedure in that other case. The Executive will promptly inform the Chairman of the Code Compliance Panel of such action.

8.6.3    

  1. Within two working days following the making of a direction under paragraph 8.6.1, service providers may apply to PhonepayPlus for an urgent review of the use of the emergency procedure in the particular case.
  2. The application must be made in writing together with any supporting evidence setting out:
    1.  the grounds on which the service provider considers that the emergency procedure should not have been used in respect of the services and/or;
    2.  the grounds on which the service provider considers that access to the services or numbers should no longer be prevented.
  3. Subject to any requirement for further information, a Tribunal will consider the matter within two working days of receipt of an application for review and shall decide, through whatever process it decides, whether the prevention of access to the services or numbers should continue pending completion of the normal process under paragraph 8.6.1, or whether access should be permitted to some or all of the services or numbers concerned, and if so upon what, if any, conditions. 

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8.7    Information provider cases

8.7.1     In any case in which a service provider and information provider wish PhonepayPlus to deal directly with the information provider, the service provider must provide to PhonepayPlus:

  1. the service provider response to the case required under 8.5 or 8.6, together with a request in writing for PhonepayPlus to deal directly with the information provider in respect of the case, and
  2. the acceptance and undertakings of the service provider and information provider required in accordance with paragraph 8.3.4, in such form as PhonepayPlus may prescribe.

8.7.2     PhonepayPlus will (subject to any requirement for further information) determine within five working days thereafter whether it is willing to exercise its discretion to deal directly with the information provider in the relevant case.

8.7.3     If PhonepayPlus determines that it is willing to deal directly with the information provider, the case will be processed for the purposes of these rules as if the information provider was the service provider so that the information provider shall (together with any other rights or obligations) be entitled to require an oral hearing and to appeal to the Independent Appeals Body (IAB) in respect of the case, and shall be subject to any sanction duly imposed.

8.7.4     For the avoidance of doubt, the Tribunal may, in determining any sanction against an information provider, take into account to the extent appropriate any breach history of the information provider, including any involvement of the information provider in services where a breach was upheld against a service provider. Once a determination has been made under this paragraph, the service provider will have no further right to take part in the process as a party.

8.7.5     The Tribunal may, for good cause, determine at any time in the course of the process of a case that the case is not suitable to be dealt with other than directly with the service provider. If the Tribunal so determines, the case shall recommence as a case in which PhonepayPlus deals directly with the service provider and, in so far as practicable, no Tribunal member previously involved in the matter shall take further part in the process. 

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8.8    Adjudication

On the basis of the evidence presented, the Tribunal will decide whether there has been a breach of the Code. Each case will be considered and decided on its own merits. Service providers will be notified of the adjudication in writing. Where the adjudication has been made on the papers alone, or following informal representations in person, the notification will include reference to the service provider’s right to an oral hearing. 

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8.9    Sanctions

8.9.1     Once the Tribunal has determined that there has been a breach of the Code, the Executive will put before it the service provider’s details. These will include a list of any relevant breaches previously upheld, sanctions imposed on the service provider and any other relevant information.

8.9.2     The Tribunal has a range of sanctions which it may apply according to the degree of seriousness with which it regards any breaches. Having taken all relevant circumstances into account, PhonepayPlus may singularly or in any combination in relation to each breach:

  1. require the service provider to remedy the breach,
  2. issue a formal reprimand,
  3.  require the service provider to submit certain or all categories of service and/or promotional material to PhonepayPlus for copy advice and/or for prior permission for a defined period,
  4.  impose an appropriate fine on the service provider to be collected by PhonepayPlus,
  5. require that access to some or all of the service provider’s services and/or numbers be barred for a defined period and direct the relevant network operator(s) accordingly,
  6. prohibit a service provider, information provider and/or any associated individual found to have been knowingly involved in a serious breach or series of breaches of the Code from involvement in or contracting for the provision of a particular type or category of service for a defined period,
  7. prohibit a service provider, information provider and/or any associated individual found to have been knowingly involved in a serious breach or series of breaches of the Code from involvement in or contracting for the provision of any premium rate services for a defined period,
  8. require, in circumstances where there has been a serious breach of the Code and/or where an intent to mislead or defraud has been demonstrated, that the service provider pays all claims (or any specified category of claims) made by users for refunds of the full amount spent by them for the relevant service, save where there is good cause to believe that such claims are not valid.

 8.9.3     The failure of any service provider to comply with any sanction within any reasonable time period imposed on it by PhonepayPlus will result in:

  1. PhonepayPlus issuing a direction to all relevant network operators requiring suspension of access to some or all of the numbers allocated to the service provider until full compliance with PhonepayPlus sanctions has been achieved,
  2. a further breach of the Code by the service provider, which may result in additional sanctions being imposed.

8.9.4     If the Tribunal considers that it may wish to make a recommendation under paragraph 8.9.2f or 8.9.2g in respect of any named individual, PhonepayPlus shall first make all reasonable attempts to so inform the individual concerned and the service provider or information provider in writing. It shall inform each of them that any of them may request an opportunity to make informal representations to the Tribunal in person and of the right of any of them (or of PhonepayPlus itself) to require an oral hearing.

8.9.5     Where an individual (or PhonepayPlus) requires an oral hearing pursuant to the right set out in paragraph 8.9.4 but the associated individual fails, without good cause, to appear (either himself of through his representative) at an oral hearing which is properly established, then that oral hearing panel may make such a finding as it considers fit.

8.9.6    Refunds

  1. Where payment of refunds has been imposed as a sanction in accordance with 8.9.2h, it is the responsibility of the service provider to pay all claims for refunds as required by PhonepayPlus, except those where there is good cause to believe that any such claim is not valid.
  2. If money that would otherwise have been paid to the service provider has been retained by a network operator in accordance with a direction from PhonepayPlus or other obligation under the Code (‘a retention’), and if the service provider satisfies PhonepayPlus that it is unable to comply with the sanction without recourse to the money so retained, it may pass details of payable claims to the network operator which shall make the refund payments due from the retention.
  3. If the service provider fails to deal promptly with claims made for refunds, PhonepayPlus (without prejudice to taking action against the service provider under paragraph 8.9.3) may direct any network operator which has a retention to deal with claims for refunds and pay the refunds from the retention.
  4. If PhonepayPlus has not issued directions under paragraph 8.9.6c, the obligation of the network operator shall cease three months after completion of the PhonepayPlus adjudication process and any time period for appeal to the IAB or the conclusion of such appeal or, if sooner, when the retention has been fully expended.
  5. If there is a retention remaining following payment of all claims for refunds or at the end of the three-month period, it must be used to discharge in whole or in part PhonepayPlus fines and/or administrative charges outstanding and payable by the service provider. If any retention remains thereafter, the network operator shall be entitled to deduct from the retention its costs and expenses arising from dealing with refunds. 

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8.10    Reviews

8.10.1     On reasonable grounds, a Tribunal may, at its discretion, review determinations made in respect of applications for prior permission and adjudications and/or sanctions.

8.10.2     A service provider or applicant for prior permission may request a review by setting out in writing the case for such a review.

8.10.3    Review procedure
Having received a written request setting out the reason why a determination made in respect of an application for prior permission or an adjudication and/or sanction should be reviewed, the Chairman of the Code Compliance Panel will decide whether the review is merited in which event a Tribunal will carry out the review.

8.10.4     Following such written request, the Chairman of the Code Compliance Panel may suspend any sanction imposed pending a review. 

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8.11    Oral hearings

8.11.1     Any service provider, applicant for permission or associated individual (‘the applicant’) may, by notice in writing to the Executive, require that an oral hearing be held:

  1. in the event of a refusal by a Tribunal to grant prior permission to provide a service, or only to grant it upon condition,
  2. following receipt of any communication from the Executive alleging a breach or breaches of the Code,
  3. in respect of any adjudication made by a Tribunal without an oral hearing,
  4. in the circumstances of an intention to make an order under 8.9.2f or 8.92g.

8.11.2     The applicant must, within such written notice, provide details of the allegation or decision in respect of which the oral hearing is required and set out clearly the applicant’s case in respect of the relevant
allegation or decision.

8.11.3     Such written notice may be provided to the Executive at any time up to 10 working days after receipt by the applicant of written notification of a decision by PhonepayPlus or at any time prior to the adjudication being made where the oral hearing is required following an allegation of a breach of the Code.

8.11.4     PhonepayPlus may require at any stage of its processes that an oral hearing be held.

8.11.5     Oral hearings shall take place before a Tribunal appointed for the purpose.

8.11.6     The applicant is entitled to appear at the oral hearing in person or to be represented. The Executive will attend the oral hearing in order to put the case against the applicant and may instruct a representative to act on its behalf.

8.11.7     The enforcement of sanctions imposed pursuant to an adjudication is not automatically suspended by written notice requiring an oral hearing. The applicant may apply in writing to the Chairman of Tribunal (‘the Chairman’) setting out the grounds on which the sanction should be suspended. Unless the Chairman considers that there are exceptional reasons in the particular case to grant the application, he will only do so if he is satisfied that not to do so would give rise to undue hardship, and that to do so would not give rise to a significant risk of public harm. If an applicant has not been granted a suspension of sanction but has not complied with the sanction, the Chairman may stay the oral hearing.

8.11.8    Procedures for hearing

8.11.8.1    Pre-hearing process

  1. The Chairman will give such directions as he considers necessary for the fair and speedy hearing of the oral hearing.
Such directions may include, for example, directions for:
    • the exchange of statements of case,
    • the admission of facts before the hearing,
    • the disclosure of documents,
    • the provision of expert reports,
    • the exchange of witness statements,
    • the preparation of agreed bundles of documents,
    • the submission and exchange of outline arguments,
    • the provision of security for the administrative charges of PhonepayPlus.
Directions may be given as to the date by which such actions shall be taken. Where it appears reasonable in all the circumstances, the Chairman may strike out a case or take such other steps as he sees fit where any direction is not followed.
  1. The Chairman may convene a conference for the purpose of providing directions or may deal with directions by correspondence or phone, as he sees fit.
  2. Not less than 10 working days before the date of the oral hearing, the applicant shall be notified in writing (at the address of the applicant last made known to PhonepayPlus) of the day, time and place of the oral hearing.
  3. Within five working days of receipt of the notice specifying the date of the hearing, the applicant shall inform the Executive in writing of whether he intends to appear in person at the hearing and the name of any person who will be representing him at the hearing.
  4. The Chairman may vary any of the time limits set out in these procedures.


8.11.8.2     If the applicant is neither present nor represented at the hearing, and the Tribunal has no cause to believe there is a good
reason for the applicant’s absence, the matter shall be determined by Tribunal as it sees fit in the absence of the applicant.

8.11.8.3    The hearing
In respect of alleged breaches of the Code of Practice:

  1. The Executive shall outline the grounds of the case, and call such witnesses and refer to such documents as it is entitled to do.
  2. The applicant shall then be entitled to respond to the case put by the Executive and to call such witnesses or present any written statements or other documents as he is entitled to do.
  3. The Executive shall then be entitled to address the hearing panel.
  4. The applicant shall be entitled to reply.
  5. A witness in person may be cross-examined. A witness who has been cross-examined may be re-examined.
  6. The Chairman of the Tribunal may question any witness at any time.

In respect of a case concerning an application for permission, the Chairman shall adopt such procedures as he shall deem to be most convenient.

The Chairman of the Tribunal shall have the power to vary any of these procedures at any time and to adjourn the hearing if satisfied that it is in the interests of justice to do so.

8.11.8.4     Confidential information
The Tribunal shall be entitled to consider and act upon confidential information without directly or indirectly disclosing to the applicant (or the Executive as the case may be) the source of that information, provided that the other party is given a reasonable opportunity to rebut its substance.

8.11.8.5    Recording
A sound recording shall be made of the oral hearing. Recordings will be made available to the Executive and the applicant.

8.11.9    Public hearing
An oral hearing shall be conducted in private, unless the applicant or the Executive otherwise requires. If an oral hearing is in public, either party may request that any part of the hearing be conducted in private and any such application shall itself be heard in private.

8.11.10    Powers of the Tribunal
The Tribunal shall decide the matter dealt with in the oral hearing entirely afresh. For the avoidance of doubt, the Tribunal:

  1. may impose a greater or lesser sanction than that previously imposed by the Tribunal which dealt with the matter previously,
  2. may reverse a decision to issue or refuse a permission,
  3. may set such conditions on a permission as it sees fit,
  4. must agree to impose such sanctions, permissions and/or conditions, and administrative charges or otherwise dispose  of the matter as may be jointly agreed by the Executive and the applicant and which has been agreed by the Chairman of the Code Compliance Panel, or if he is unavailable by one of the legally qualified Panel members (‘adjudication by consent’).

8.11.11    Decision and publication
The Tribunal shall, as soon as is practicable after the hearing, provide a reasoned written decision. All decisions, whether reached through written or oral process, shall be published by PhonepayPlus and may identify any network operator, service provider and information provider concerned. Publication will be effected by placing the written decision on the PhonepayPlus website and in any other way that PhonepayPlus shall determine. 

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8.12    Administrative charge

All service providers found to be in breach of the Code may be invoiced for the administrative and legal costs of the work undertaken by PhonepayPlus. Non-payment within the period laid down by PhonepayPlus will also be a breach of the Code and may result in further sanctions being imposed. PhonepayPlus may direct that the relevant network operator withholds and passes to PhonepayPlus the sum(s) due from the payments outstanding under the contract between the network operator and the service provider.

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