Beefed-up Bill now better

Consumers will still be able to claim a refund from their phone company for incorrect billing under the new Communications Bill – but this right was only inserted late in the day, writes CONOR POPE

HOW MUCH DO lame jokes, cheesy ringtones or ridiculous horoscopes sent to your mobile phone typically cost?

(A) A couple of cent

(B) Five cent

(C) Free

(D) €2.50

Simply text Price Watch, followed by your answer, to 11*11 for a chance to win a fabulous prize. There is, of course, no fabulous prize – we’re far too cheap for that sort of carry on here – but, if you were to answer the question, you’d be best advised to go for D. While €2.50 might sound like a ridiculous price for content of such dubious merit, it is the going rate for a lot of services that people in Ireland are signing up for either intentionally or by accident every day.

The sky-high prices attached to many phone services, and the ease with which people can sign up for them, are the main reasons why the Irish premium rate phone sector has grown into an industry worth tens of millions of euro over the last decade – 76 million premium rate text messages were generated in the Republic last year alone. Many phone users have contacted Price Watch to complain about certain services and they are convinced that the business has grown so large, so quickly, because unscrupulous operators employ underhand tactics to get people to inadvertently sign up for expensive services that they have little interest in. The mobile phone companies are also frequently blamed for facilitating this carry on.

People complain that they didn’t know they’d signed up to services until they received their phone bills. Others complain that service providers fail to implement the “stop” command or insist they were never notified of a €20 spending limit. Problems are particularly widespread among children who can see their phone credit wiped out over and over again after inadvertently subscribing to services while requesting more information.

There are, undeniably, many legitimate companies offering services of real value to users just as there are many rogue traders. And consumers – particularly adult consumers who really should know better – should take great care when entering any competition or communicating in any way with such providers and pay particular attention to the terms and conditions so they will know what they are letting themselves in for.

In the last 10 years, companies selling mobile phone ringtones, wallpapers, games and quizzes have been forced by the industry watchdog RegTel to refund nearly €1,000 a week to consumers, a total of €460,000 since 1999.

Earlier this month RegTel expressed concern that consumers who had been ripped off could find it more difficult to seek financial redress once the new Communications Bill – currently being shepherded through the Dáil by the Minister for Communications Eamon Ryan – becomes law.

At the launch of RegTel’s final report before being swallowed up by telecommunications watchdog ComReg, its chairman Fred Hayden criticised some elements of the Communications Regulation (Premium Rate Services) Bill 2009. “It is the minister’s prerogative to bring about a re-organisation and legislative changes. But in the process he has failed to listen to the board and staff of RegTel who have direct experience of regulating a difficult sector for the past 15 years.”

Hayden warned that the new Bill did not include “the power to order refunds in cases of wrongdoing, a power that RegTel now exercises, thereby providing a powerful means of deterring wrongdoing by service providers”. He accepted that the new legislation included “powerful sanctions” to deal with unauthorised services, but said it failed to provide redress for consumers who wanted “a refund now rather than fines on offenders sometime in the future”.

Not including any reference to refunds was a curious oversight on the part of the minister but it was one he was quick to address when the proposed legislation reached committee stage last week.

Under last minute changes, ComReg was given powers to include the terms under which refunds could be made in the licences given to the providers of premium rate services. Ryan said that the changes to the bill gave explicit recognition to a consumer’s right to a refund where overcharging occurred.

The changes forced upon the minister were a victory for RegTel, its last hurrah perhaps. But it would have been a misreading of Hayden’s criticism of the Bill to suggest they were an indication of bitterness at the absorption of RegTel into ComReg. Insiders admit its amalgamation with ComReg makes perfect sense, not least because the legislation under which it was drawn up has long since passed its best-by date – it was set up in 1995 when there was only one phone company and virtually no-one had a mobile phone.

Despite the loose legislation, RegTel has done a reasonable job policing the sector. It has always operated on the basis of a voluntary code of practice and, while it was frequently accused by critics as being more of a telecommunications lapdog than watchdog, it bared its teeth to errant service providers more often than some of its counterparts.

At present, if a provider of a premium rate service breaches the voluntary code, RegTel can instruct the phone network not to carry the service or ask it to hold on to the revenue it has collected on the rogue provider’s behalf. Said provider then has two choices: toe the line; or take to the High Court (generally speaking). Although not always, the providers select the former route.

If the Bill had made no provision for refunds, RegTel feared that the first time ComReg demanded a service provider to pay a customer a refund, the providers could simply say the Oireachtas has approved legislation covering the sector and made no allowance for refunds.

Labour’s communications spokeswoman Liz McManus had been particularly vocal in calling for the minister to introduce a refunds clause and had promised to table amendments at the committee stage.

Rather than allow her take the lead, Ryan decided he had little choice but act. His amendments do not go into much detail as to how the refund system will work but the fact that they were mentioned at all should strengthen the Bill and block off one legal avenue down which rogues would have tried to flee in the future.

But this is not the end of the road. While opposition TDs welcomed Ryan’s belated recognition of the need for a reference to refunds, they claimed the wording was too weak and criticised the exclusion of broadcasters from its remit. There is no mention of television gameshows and contests decided by phone-in votes, critics say, and McManus predicts that rip-offs in this arena will flourish.