2012 Irish Premium Rate Industry-why they went squealing to the courts
Premium-rate service providers win order to stay sections of new code
June 02, 2012
A body representing providers of premium services to mobile phones have secured a High Court order staying sections of a new code of practice for the industry due to be introduced next Tuesday.
Phone Paid services Association Ltd (PPSA) which represents more than 50 providers of premium rates services (PRS), such as text based competitions, charity donation services, peer-to-peer chat services, ring tone and video clips, claimed the new code would immediately put them out of business and allow foreign firms take over the market.
The action brought by the PPSA and two other Irish registered PRS providers Modeva Interactive and Zamano Plc is against the Commission for Communications Regulation (Comreg), which regulates the sector.
Comreg and the State had opposed the application.
They claim the new code of practise is required in order to protect consumers and improve confidence in the sector.
It also claimed the application was an abuse of process as similar proceedings between the parties are currently before the Commercial Court.
In his ruling at the High Court late on Saturday evening Mr Justice Kevin Cross said he was prepared to grant PPSA permission to bring a challenge against sections of the new code from the PRS sector.
The Judge made orders staying certain sections of the new code which the plaintiffs argue will put them out of business. The remaining parts of the new code that are not subject to the proceedings will come into being on June 5th.
The Judge said he was satisfied the plaintiffs had made out an arguable case and had crossed the low threshold required to grant leave to bring proceedings.
He was also satisfied damages would not be an adequate remedy, and that the balance of convenience favoured the granting of the stay.
He rejected Comreg’s claims the plaintiff’s action amounted to an abuse of process, or that their action had been brought out of time.
The stay, the Judge added will remain in place until further order.
The full hearing of the judicial review proceedings will be determined at a later date.
In their action PPSA Modeva and Zamano are seeking various orders including one staying Comreg's decision, made on April 5th last to introduce the new code of practise.
They want the code, or in the alternative certain sections of the code re-assessed.
The plaintiffs claim the new code would significantly increase their costs and customer acquisition rates. These additional costs would make their business unviable and result in their immediate closure.
Previously the sector was regulated under a code introduced in 2008, which was similar to codes in other EU state. The new regulations are more severe than what is in operation in other jurisdictions, it was claimed.
The new code would only apply to Irish based PRS providers and not to those located in other EC countries.
It would result in Irish providers being eliminated and their business being taken over by foreign based competitors, it was claimed.
In addition the plaintiffs claim they would not be able to upgrade their technology in time to meet the June 5 deadline.
Lawyers for Comreg denied all of the plaintiff’s claims.
Comreg’s lawyers claimed it has received thousands of complaints relating to Premium Rate Services from the public, and that the sector needs to be regulated.
Ultimately the code will be to the benefit of the industry, it claims.
so what are the proposed consumer protection measure that would 'significantly increase their costs
' and affect their 'customer acquisition rates
Premium Rate Services Code of Practice Update
As a result of a last-minute application to the High Court on Friday 31 May by
Modeva Interactive, Zamano plc and the Phone Paid Services Association, the High Court granted a stay on the implementation of Sections 4.15, 4.22, 5.13-5.15 and 5.64 of ComReg’s new Code for PRS providers. This new Code was due to come into effect in its entirety on 5 June 2012 but as a result of the Order of the High Court the new Code will come into effect but not the sections referred to above.
4.15 The following information must be spoken as part of any invitation to
purchase on radio or TV:
(a) the name and description of the PRS,
(b) where it is not a Subscription Service, the cost of the PRS if the cost is
greater than €2,
(c) where it is a Subscription Service, the fact that it is a Subscription
Service and the charge per period and that charge period.
4.22 PRS Providers must ensure that the phrase "Subscription Service" and the name of the service are clearly provided:
(a) in the case of promotions on television:
(i) at the top of the screen in a prominent, highly visible and stationary manner for the duration that the call to action is displayed,
(ii) in a font at least 33% of the size of the call to action, and
(iii) in the voice-over for the promotion.
(b) in the case of online promotions or promotions in print:
(i) in the main body of the advertisement in a prominent and highly visible manner and not part of the promotion footer, and
(ii) in a font at least 33% of the size of the call to action.
(c) in the case of any voice over promotions,
(d) in the case of promotions by SMS, MMS or WAP, in a manner so that it
is viewable without the need for scrolling.
5.13 When an end-user requests to subscribe to a Subscription Service, and prior to an end-user incurring any charges, the PRS Provider must send a
standard, dedicated, SMS Subscription Request Message, as set out in Sections 5.14 and 5.15 below, to the nominated mobile phone number, at no
charge to the end-user.
5.14 A Subscription Request Message must not contain any links or promotional material and must clearly:
(a) commence with the phrase "Free Message" or "Free Msg" in the SMS
header, or as the first words in the body of the text,
(b) include a description of the Subscription Service to include the PRS name that will allow end-users to identify the PRS, which must be the name used consistently through all promotions and delivery of the service,
(c) provide an age warning, where appropriate,
(d) include any sign-up cost,
(e) include the basis for calculating charges including any:
(i) charges for each message received,
(ii) charges for each message sent, and
(iii) charge per charge period and the relevant charge period.
(f) instruct the end-user to send a plain dedicated SMS, with a
KEYWORD, to a particular short code in order to subscribe.
5.15 Subscription Request Messages must follow the format of the example
SUBSCRIPTION REQUEST MESSAGE
To subscribe to [name of service and optional description] for [signup cost] and [cost of service in €] per [billing frequency - message
received/time] and confirm that you are over 18 yrs, text AGREE [or
other unique keyword for the service] to Short Code 5XXXX.
apart from the Irish Courts being a feckin ass - so they are whinging that to market and promote their services properly and transparently like most other retailers would cost to much and hinder them from acquiring 'customers'.....which explains why tens/hundreds of thousands of their customers
have been alleging everything from scam to out right theft from accounts.
Last edited by El Gringo; 03-June-2012 at 23:52.