Consumer involvement in telecommunications regulation

ACMA International Training Program 2006

Elizabeth Beal, Director

IntroductionCommunications Law Centre

A non-profit research, teaching and public education organisation specialising in media and communications law and policy

(http://www.comslaw.org.au)

Oz NetLaw An internet legal practice of the CLC providing legal information

and advice on internet and e-commerce related issues.(http://www.oznetlaw.net)

Lecture Outline

The role of NGOs (consumer & public interested organisations) in current regulatory framework:

Case Study: Communications Law Centre

Consumer protection framework Case Study: Unfair Terms in Telecommunications

Consumer Contracts

The CLC addresses consumer/public interest issues in telecommunications through:

Consultative & Co-regulatory forums Research Expert Advice Law Reform Public Education & Awareness

Consultative & Co-regulatory forums

Consultative & Co-regulatory forums The CLC participates in several consultative and co-regulatory forums relevant to telecommunications consumer issues:

– Australian Communications and Media Authority - Consumer Consultative Forum

– Australian Consumer and Competition Commission - Consumer Consultative Committee

– Australian Communications Alliance (incorporating ACIF) - Consumer Council

– Telecommunications Industry Ombudsman - Council– Telstra - Consumer Consultative Council

ACMA CCF

• The current Consumer Consultative Forum (CCF) was established in 1997 in accordance with the Australian Communications Authority Act 1997 and continues under the Australian Communications and Media Authority Act 2005.

• Previously met twice a year for consumer input – recent review has proposed a new CCF format supplementing the CCF meetings with an annual consumer conference.

ACMA CCF Terms of Reference

The terms of reference for the ACMA CCF are to:– assist the ACMA with consumer consultation on

matters relating to its telecommunications functions – ensure that consumer interests are adequately

considered in ACMA's decision-making and – assist in informing the community about

telecommunications service issues and matters relating to the industry

Issues for ACMA CCF ConsultationIssues to be considered by the CCF are issues that ACMA may address under the provisions of the Telecommunications Act 1997, and may include-but are not limited to:

– Access to services – Quality of service issues – Regulatory arrangements – Emergency services – Technological changes – Privacy

ACMA CCF MembersConsumer Organisations: Australian Consumers' Association (ACA), Consumers' Telecommunications Network (CTN), Council on the Ageing (COTA), Federation of Ethnic Communities' Councils of Australia (FECCA), Isolated Children's and Parents' Association of Australia (ICPA-Aust), Australian Federation of Disability Consumers (AFDC), National Farmers' Federation (NFF), Small Enterprise Telecommunications Centre Ltd (SETEL), Youth Action and Policy Association (YAPA)

Government Bodies: Aboriginal and Torres Strait Islander Commission (ATSIC), ACMA (Chair), ACCC, Department of Communications, Information Technology and the Arts (DCITA)

Industry/Policy Bodies: Australian Telecommunications Users Group (ATUG), Communications Law Centre (CLC), Telecommunications Industry Ombudsman (TIO)

Consultation with the ACCC“The Trade Practices Act sets out formal procedures for the submission of views and information on adjudication matters and conferences. Less formal arrangements have been established through contact with industry associations and consumer groups.”

- ACCC Annual Report 04-05, p 199

ACCC CCC

•The Australian Competition and Consumer Commission Consumer Consultative Committee meets to advise the ACCC on issues and trends affecting consumers that fall within the scope of the Trade Practices Act. It meets quarterly.

•Telecommunications issues have held the position of the highest area of consumer complaint to the ACCC for several years. The specific expertise of the CLC in this field is useful in providing information to other consumer representatives as well as Commission staff.

ACCC CCC MembersComprises of consumer, community and welfare organisations from around Australia. Members during 2004/2005 were:

– Australian Consumers’ Association– National Council on Intellectual Disability– National Children’s and Youth Law Centre– Australian Financial Counselling and Credit Reform Association– Tangentyere Council– Federation of Ethnic Communities’ Council of Australia– Communications Law Centre– Consumer Law Centre Victoria– Consumers’ Federation of Australia– Country Women’s Association of Australia– Tasmanian Council of Social Service– Public Interest Advocacy Centre

ACIF Consumer Council•The ACIF Consumer Council (the Council) was an initiative to ensure adequate and appropriate broad consumer input into ACIF processes and activities, particularly, in Code development. The Council works in parallel with, and is complementary to, the existing ACIF Structure.•The roles and responsibilities of the Council are based upon providing broadly-based consumer input to ACIF, including input to the ACIF Strategic Plan and input to the ACIF Works Program.•The scope of the Council is not limited to the work and role of ACIF. Council meets with some of the other Government and industry departments involved in the telecommunications industry including ACMA and theTIO.

ACIF CC MembersThe Council comprises up 14 members as at (January 2006) from a wide range of consumer representative and public interest representative:

– Consumers Telecommunications Network– Outback Digital Network– Dr Christopher Newell (ACIF Disability Council)– Australian Council of Social Services– Australian Seniors Computer Clubs Association– Australian Telecommunications Users Group– Communications Law Centre– Country Womens' Association of Australia– Ethnic Communities' Council of Victoria– Internet Society of Australia– National Council of Women of Victoria– Small Enterprise Telecommunications Centre Limited– Telecommunications Consumer Group SA– Collective of Self Help Groups

Recent ACIF CC Reforms Reduced from 14 members to 9;

Reduction in number of meetings;

Each member has to go through an ACIF selection process.

Role of TIO Council•The Council's role is complementary to that of the Ombudsman in that the Ombudsman has responsibility for the day-to-day operation of the TIO Scheme and the Council's role is to provide policy advice to the Ombudsman and to the Board.

•The Council's role as an intermediary between the Ombudsman and the Board ensures the independence of the Ombudsman.

Responsibilities of TIO Council•to determine policies and procedures within the framework of the Constitution of TIO Limited; •to recommend to the Board a person to be appointed as the Ombudsman; •to recommend to the Board the termination of the appointment of the Ombudsman if required; •to make recommendations, if it thinks fit, to the Board concerning the appointment and termination of an Acting Ombudsman and a Deputy Ombudsman; •to monitor the Constitution and make recommendations to the Board on amendments thereto where necessary; •to receive and consider recommendations from the Ombudsman for amendments to the Constitution; •to provide advice to the Ombudsman on resource allocation; •to receive and consider the TIO's financial budgets and business plans; •to refer financial budgets and business plans to the Board with comments and recommendations; •to make recommendations to the Board as to the appropriateness, scope and timing of a review of the TIO Scheme; and •to provide advice to the Ombudsman on the promotion of the TIO Scheme and the preparation of the Annual Report.

TIO Council Composition•The Council comprises at least seven representatives. There are currently five industry representatives and five public interest/user group representatives (including a staff member from the Communications Law Centre), with an independent Chairperson. •The TIO Board appoints an independent Chairperson of the Council, who is not associated with any Member of TIO Limited. Before appointment of the Chairperson, the Board consults with the Minister for Communications and the Minister responsible for Consumer Affairs Policy.

Role of TCCC•The TCCC has the following objectives:

– Improve Telstra's knowledge and understanding of the interests and concerns of consumers and particular groups of consumers

– Improve consumers' knowledge and understanding of Telstra's policies and activities and the environment in which it operates

– Provide structured opportunities for consumer representatives to provide input into Telstra's decisions and on specific initiatives

– Provide structured and networking opportunities for Telstra and consumer representatives to explore initiatives of mutual benefit

TCCC Member Organisations•Federation of Ethnic Communities Councils Australia•Isolated Children's Parents' Association•Small Enterprise Telecommunications Centre•Councils on the Ageing•Australian Seniors Computer Clubs Association•Australian Council of Social Service•Communications Law Centre•Indigenous Remote Communication Association•The Internet Society of Australia•Australian Financial Counselling & Credit Reform Association•Youth Affairs Council of Victoria•National Council of Women in Australia•Central Land Council•Australian Federation of Disability Organisations•Consumer Telecommunications Network

TCCC Issues Previously Discussed•Improving communications services in rural, regional and remote Australia •Consumers and next generation communications technologies •Simplifying Telstra’s customer contracts•Remote Indigenous communities – understanding the user environment in order to develop appropriate telephone services •Consumer codes and consumer protection – the effectiveness of the self-regulatory regime in delivering appropriate consumer protections •Telstra's Corporate Social Responsibility reporting •Researching the impact of the Access for Everyone program for people on low incomes •New mobile data features and the socially responsible use of mobile phones •Mobile culture – investigating the ways in which wireless networks are changing our society and our use of the home telephone •The converging regulatory environment for broadcasting and communications •Broadband takeup – the technologies, the prices, credit management issues, community sector usage

The CLC addresses consumer/public interest issues in telecommunications through:

Consultative & Co-regulatory forums Research Expert Advice Law Reform Public Education & Awareness

Research

CLC Research Includes:•Not So Special: Telecommunications Contracts, Disability and Unfair Practices (2006)•Going Going Gone Online Auctions, Consumers and the Law (2006)•Model consumer contract for telecommunications (2004)•Counting the cost: low income households and telecommunications (2002) •One size fits none: Australian telecommunications household profiles (2002)•Unfair practices and telecommunications consumers (2001-02) •Mobile matters: young people and mobile phones (1999)

Expert Advice

CLC Expert Advice Includes:•ISP Consumer Contracts Compliance with Victorian Unfair Terms Legislation – commissioned by CAV (August, 2006)•Fair Trading Act 1999 (Vic) Compliance Review: Unilateral Variation & Early Termination Clauses (Feb, 2006) commissioned by Consumer Affairs Victoria (CAV)•Mobile Phone Contracts: Compliance with Victorian Unfair Terms Legislation – commissioned by CAV (March, 2004)•Telecommunications Consumer Contracts: Compliance with the ACIF Consumer Contracts Industry Guideline (2003) commissioned by the ACA (now ACMA)• Consumer Experiences with Selling Practices (1999) commissioned by Australian Communications Industry Forum (ACIF)

CLC Expert Advice (cont …)•The CLC and its staff regularly receives requests to provide an opinion on telecommunications issues due to the expertise of the CLC and staff in the area. Informal and formal requests for our views are received from government, industry and consumer organisations including:

– DCITA, Senate Committees, (government)– ACCC, ACMA, CAV (regulators)– ACIF, TIO, TISSC (industry organisations);– ACA, CTN (consumer organisations)

•The media also regularly requests the CLC to comment on telecommunications issues

Law Reform

Independent from industry & government

While the CLC regularly undertakes research and other activities in association with industry, regulators or other government bodies, its role as an independent advocate for the public interest is always maintained. The CLC frequently provides submissions to public inquiries and reviews, arguing for policy outcomes that do not necessarily reflect the interests of the industry or government entities with which it has been involved

CLC submissions to public inquiries & reviews include:

•Australian Communications Industry Forum’s (ACIF) issues paper, A Single Consumer Code for Telecommunications (2005)•Senate Environment, Communications, IT and the Arts References Committee, Legislation Committee, Inquiry into the Australian Communications and Media Authority (January 2005). The CLC Director, attended the Senate Committee hearings in Canberra and provided oral evidence to support the CLC’s written submission.•Internet Industry Association IIA Codes of Practice – Internet and Mobile Content (December 2004)•Office of the Federal Privacy Commissioner - Review of the Private Sector provisions of the Privacy Act (December 2004)•Australian Communications Authority (ACA) Interim Consumer Protection Principles and Procedures for Premium Rate Services (First Submission) (March 2004)

CLC submissions (cont…): •ACA Interim Consumer Protection Principles and Procedures for Premium Rate Services (Second Submission) (March 2004)•Standing Committee of Officials of Consumer Affairs Unfair Contract Terms Working Party: Unfair Terms Discussion Paper – March 2004•Senate: Regional Telecommunications Inquiry – September 2002•Senate Select Committee: Australian Telecommunications Network Inquiry – July 2002•Australian Broadcasting Authority: Adequacy of Local News and Information Programs on Commercial Television Services in Regional and Rural Australia – February 2002•Fair Trading Advisory Council, NSW Department of Fair Trading: Infomercial Inquiry – November 2001•Productivity Commission: Inquiry into Telecommunications Competition Regulation – September 2001•ACA: Development of Code for Internet Service Providers – August 2001

Public Education & Awareness

Public Education & AwarenessResearch and consumer information made publicly available

Public education & awareness projects

Media coverage

Research & consumer information publicly available

CLC & UNSW press, Australian Telecommunications Regulation: the Communications Law Centre Guide (2004) an in-depth telecommunications law publication now in its third editionCLC, Communications Update covering news, analysis and opinion on media, communications and online issues Books Chapters: eg The Law Handbook (9th ed), Redfern Legal Centre PublishingJournal articles: eg Telecommunications Journal of AustraliaPrevious research available at www.comslaw.org.auConsumer Information available on www.comslaw.org.au & www.oznetlaw.net

Public education & awareness projects

CLC Seminars & ConferencesGuest Speakers at other seminars/conferencesFunded/commissioned public education & awareness campaigns:

– eg TPA Consumer Trust (current)- Public Education and Awareness Campaign: Consumer Rights and Benefits in the Selection and Transfer of Telecommunication Service

Media CoverageMedia Releases

Letters to the Editor/opinion pieces

NGO Funding in Telecommunications

•Government Grants (DCITA Telecommunications Representation Grant)•Commissioned Projects (Regulators & Industry)•Funds for Independent Research (Philanthropic Trusts & Government Trusts)•University/Academic Sector: (Victoria University & UNSW)•Unfunded Work (a large portion is unfunded)•Other organisations have membership fees to fund activities (eg Australian Consumers’ Association (ACA)). ACA also charges a fee for full access to its Choice magazine.

CLC & DCITA Grant•ACIF Consumer Council Sitting Fees (ongoing)

•One size fits none: Australian telecommunications household profiles (2002) funded primarily by the Department of Communications, Information Technology and the Arts’ Telecommunications Consumer Representation and Research program

•Unfair practices and telecommunications consumers (2001) funded by the Commonwealth through DCITA’s Telecommunications Consumer Representation and Research Program and the Telecommunications Industry Ombudsman.

CLC Commissioned Research•Fair Trading Act 1999 (Vic) Compliance Review: Unilateral Variation & Early Termination Clauses (2006) commissioned by Consumer Affairs Victoria (CAV)•Mobile Phone Contracts: Compliance with Victorian Unfair Terms Legislation – commissioned by CAV (March, 2004)•Model consumer contract for telecommunications (2004) – commissioned by the Australian Communications Authority (ACA) (now replaced by ACMA)•Telecommunications Consumer Contracts: Compliance with the ACIF Consumer Contracts Industry Guideline (2003) commissioned by the ACA (now ACMA)• Consumer Experiences with Selling Practices (1999) commissioned by Australian Communications Industry Forum (ACIF)

CLC Projects funded by Philanthropic/Government Trusts

• TPA Consumer Trust (administered by ACCC): Public Education and Awareness Campaign – Consumer Rights and Benefits in the Selection and Transfer of Telecommunication Service (current)•Not So Special: Telecommunications Contracts, Disability and Unfair Practices (2006) funded by the Reichstein Foundation•Counting the cost: low income households and telecommunications (2002) funded by the Victorian Consumer Credit Fund (Consumer Affairs Victoria)•Mobile matters: young people and mobile phones (1999) funded by the Victorian Consumer Credit Trust and the Federal Government.

Is funding of NGOs in current regulatory

framework a concern?

Consumer protection frameworkCase Study: Unfair Terms in Telecommunications Consumer Contracts

2001 (CLC Research)CLC, Unfair practices and telecommunications consumers (2001) funded by the Commonwealth through DCITA’s Telecommunications Consumer Representation and Research Program and the Telecommunications Industry Ombudsman.

Unfair practices and telecommunications consumers (2001)

The Project examined:

– EU Directive and UK legislation on unfair terms

– Australian law– Australian experience in telecoms and other

industries

EU Directive and UK legislation on unfair terms

•Focus on Substance and procedure•Coverage: standard form contracts•Obligations: unfair terms not binding; plain intelligible drafting•Annex of particular terms: “grey list”•Adequate and effective means to prevent continued use of unfair terms•Resulted in UK telecoms contract revisions

Australian law

•Common law doctrine of unconscionable dealing•Trade practices and fair trading laws•Contracts Review Act (NSW)•Industry-specific regulation

Australian experience in telecoms and other industries

•Telecoms: TIO, ACCC, DFT/FTT complaints data; provisions in standard agreements•Other industries: real estate, retirement villages, consumer finance•Current consumer remedies: strengths and weaknesses

Unfair practices and telecommunications consumers (2001)

The Report provided the following options: – Independent amendment of potentially unfair contract

terms by industry– Existing regulatory agencies adopt new strategies– Amend telecoms-specific regulation: code?

standard?– Amend Federal and State general consumer

protection legislation

2002 (Industry Guideline)

Australian Communications Industry Forum (ACIF) developed an industry guideline on the two topics of unfair terms and intelligibility and clarity of contract information. The ACIF Consumer Contracts Guideline (ACIF G601:2002) was published in December 2002.

2003 (CLC Submission toACA on Guideline)

In early 2003 the Australian Communications Authority (ACA now ACMA) sought comment from industry and consumers on the operation of the Guideline. The CLC submitted its Report on Fair Terms in Telecommunications Consumer Contracts (2003) (unfunded), which concerned unfair terms in mobile phone standard forms of agreement, measured against the fairness threshold set by the ACIF Consumer Contracts Guideline.

2003 - CLC Report on Guideline Commissioned by ACA (now ACMA)

The CLC reviewed consumer contracts for compliance with the requirements of the Consumer Contracts Guideline for:•fixed line •mobile services,•internet (both dial-up and broadband) services. The CLC found that all providers and all types of services breached the Guideline.

See, CLC, Telecommunications Consumer Contracts: Compliance with the ACIF Consumer Contracts Industry Guideline (2003) (published by ACA now ACMA)

ACA Request for Industry Code

Following the completion of the report, the ACA wrote to the ACIF requesting that the ACIF develop a Code in relation to consumer contracts and present it for registration within 180 days.

2003 – VIC Consumer Law Amendment

In October 2003, the Fair Trading Act 1999 (Vic), was amended so that the use of unfair terms in consumer contracts is now prohibited (see Part 2B).

2004 – CLC Model Contract Commissioned by ACA

To assist with the development of the Code the CLC drafted a Model Consumer Contract for the telecommunications industry, covering fixed line mobile and internet services. This was presented to the ACA on 30 January 2004.

- see Model consumer contract for telecommunications (2004) published by ACA (now ACMA)

2004 – Mobile Phone Report by CLC Commissioned by CAV

In March 2004, Consumer Affairs Victoria (CAV) commissioned the CLC to report on the use in Victoria of unfair terms in consumer contracts for mobile phone services. The report found that there was industry non-compliance with the Fair Trading Act 1999 (Vic).

2006 - CLC Reports Commissioned by CAV

•Fair Trading Act 1999 (Vic) Compliance Review: Unilateral Variation & Early Termination Clauses (March 2006) commissioned by Consumer Affairs Victoria (CAV)•Fair Trading Act 1999 (Vic) Compliance Review: ISP Contracts (scheduled to be completed July-August 2006)

Unfair Terms & SFOAs

The use of SFOAs is an important legal issue for unfair terms in telecommunications consumer

contracts. The interpretation of what the effect is of the permitted use of SFOAs pursuant to the

Telecommunications Act is uncertain. This issue is important for consumers as it affects whether they

provide informed consent particularly when the contract is varied.