28 April 2008

TOUGH NEW ENFORCEMENT MEASURES IN PHONE-PAID SERVICES MARKET

PhonepayPlus, the phone-paid services regulator, today announced a streamlined approach to enforcement with the creation of a new Code Compliance Panel. An updated Sanctions Guide, also published today, explains the approach the Panel will take when setting fines and other sanctions.

Taken together, these represent a more transparent, proportionate and accountable approach to the regulation of phone-paid services.

PhonepayPlus seeks to build trust in phone-paid services by regulating their content, promotion and overall operation through its Code of Practice. While the majority of premium rate services are enjoyed by millions of consumers without any problems, many users have been inconvenienced or left out of pocket and it is important that an effective enforcement regime is in place to help protect consumers from scams and bad practice.

In March 2007, PhonepayPlus (then ICSTIS) proposed a greater level of separation between the Board and the Adjudication Panel to enable the Board to focus on its strategic business and ensure increased efficiency and consistency in adjudications. On 28 March 2008, Ofcom approved amendments to the PhonepayPlus Code of Practice to allow the creation of the new Code Compliance Panel, which comes into effect today.

The Code Compliance Panel comprises six men and women, each with specialist legal or adjudicatory experience. Three are legally qualified and three serve as lay members.

The new Panel will adjudicate for the first time on 8 May 2008. It comprises:

• Experienced Chairman and Adjudicator David Cockburn who has served as regulator for trade unions and employer associations since 2001. He also recently acted as Chair of the Employment Law Committee of the Law Society, and is an employment judge and trained mediator. David was a solicitor in private practice for 29 years and a leading practitioner in employment law;
• Emma Boothroyd is currently an Adjudicator with the Solicitor's Regulation Authority and a highly experienced barrister and solicitor in the field of family law;
• Michelle Peters has worked as a solicitor for Clifford Chance in marketing law and intellectual property litigation. She is currently a business consultant in franchise management and is an Independent Member (Adjudicator) of the Direct Marketing Commission (formerly the Direct Marketing Authority);
• David Jessel is Commissioner to the Criminal Cases Review Commission and has been a Member of the Advertising Advisory Committee at the Advertising Standards Authority;
• John Trevor Williams has worked extensively on child protection issues, serving as Chairman of the Independent Child Protection Conference and Lay Partner on the Health Professions Council; and
• Maggie Redfern has worked as an Editorial Policy Advisor at the BBC and was a member of the Broadcasting Standards Commission, adjudicating on complaints about fairness, privacy and offence in radio and television broadcasting.

Commenting on his appointment and the creation of the Panel, David Cockburn said: "When things go wrong in the phone-paid services market, the results can be high-profile and damaging for all concerned,"

"PhonepayPlus has a long and trusted history of protecting consumers and I am delighted to be chairing this panel of professional, experienced adjudicators at such an important time in the market's development."

Sir Alistair Graham, Chairman of PhonepayPlus said: "We aim to pre-empt and prevent problems before they reach the market, and protect consumers when they do. Convergence means that the regulator must change to cope with new challenges, and the new Panel will provide a more transparent, proportionate and accountable approach to regulation."

The procedures for adjudications remain the same. Adjudications can be submitted for review by different members of the Panel and service providers can request a formal oral hearing at any stage. More information on the Code Compliance Panel can be found at www.phonepayplus.org.uk/about/PhonepayPlus/CodeCompliancePanel/default.asp.

An updated Sanctions Guide, also published today, sets out the factors which will assist the Panel in deciding which sanctions might be relevant to a given case. It includes criteria designed to ensure that the sanction is targeted, proportionate and appropriate to the particular breach or breaches of the Code of Practice. 

It identifies a number of aggravating and mitigating factors, such as the level of co-operation with the PhonepayPlus investigation by the party involved and past breach history. The Sanctions Guide is available at www.phonepayplus.org.uk/pdfs_guidelines/Sanctions_Guide_20080408.pdf.

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For further information, please contact:
PhonepayPlus press office on (020) 7940 7415 or (020) 7940 7447.

NOTES TO EDITORS

PhonepayPlus is the organisation (previously known as ICSTIS) that regulates phone-paid services - the goods and services that you can buy by charging the cost to your phone bills and mobile pre-pay accounts. Further details of its work can be found at www.phonepayplus.org.uk.

Under the Communications Act 2003, Ofcom has responsibility for the regulation of premium rate services. In December 2007 Ofcom confirmed that PhonepayPlus will act as the agency which carries out the day-to-day regulation of the PRS market on its behalf.

Sanctions

When PhonepayPlus upholds a breach of its Code of Practice, the company responsible must immediately amend the service and/or its promotional material so that it complies with the Code. PhonepayPlus has the power to impose fines of up to £250,000, order companies to pay full refunds to complainants, bar access to services and ban named persons from operating services.