The Australian Communications and Media Authority has formally warned iTalkBB Australia Pty Ltd, a telco service provider, to comply with the Telecommunications Consumer Protections Code (TCP Code).
iTalkBB’s offer pricing did not include a compulsory surcharge, and one Customer Information Summary (CIS) failed to include the necessary information to allow consumers to compare telco offerings on a like-for-like basis.
Under the TCP Code, providers must have a CIS for each of their current offers to allow consumers to compare offers across providers and with a view to finding one that best suits their needs.
‘Telcos need to be vigilant on providing clear and accurate information about their current offers for consumers to make informed choices,’ said ACMA Chairman, Chris Chapman.
As part of the ACMA’s annual CIS audits, the ACMA assessed two of iTalkBB Australia’s offers and accompanying CIS, and found iTalkBB was not compliant with the TCP Code.
iTalkBB could face further regulatory action if the breach is not promptly rectified.
‘Our annual audit found that several telcos had dropped the ball and their CIS were out-of-date. This is a very important document for consumers to use to assist in comparing offers, and we continue to monitor industry compliance with code requirements,’ Mr Chapman added.
The audit revealed that all the larger providers were compliant with obligations to have accurate summaries. However, some of the smaller to mid-sized providers didn’t and needed to be reminded of the requirement to keep each current offer’s CIS up to date and note all inclusions.
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Media release 38/2015 - 13 August
The TCP Code
The code was registered on 1 September 2012, and included a number of new obligations on telco providers to give greater protections to customers from confusing mobile plans, bill shock and poor complaint handling practices.
It delivered on the key recommendations of the ACMA’s Reconnecting the Customer report which proposed five substantial changes to make buying and using a mobile phone, or internet service, much simpler.
Critical Information Summary
The requirement for providers to have a CIS for each of their current offers has been in force since 1 March 2013.
An example is available here.
Content of Advertising
The TCP Code contains strict rules about how providers must advertise telco products and services to consumers. Any important conditions, limitations or restrictions need to be included.
There are a number of practices providers must not engage in, including making headline representations as to a price or offer where the overall impression is subsequently qualified by the fine print, which means that the offer is unachievable. In iTalkBB Australia’s case, the headline representations of $6.99 per month, for its home phone plan, and $49.99 per month, for its broadband plan, could not be achieved by its customers as a compulsory surcharge of three per cent was applicable.
The ACMA’s powers
Where the ACMA finds a breach of the TCP Code, it can:
- agree with the provider on steps it will take to remedy the breach or improve compliance
- give a formal warning
- give a direction to comply with the Code.
The ACMA is not able to impose a pecuniary penalty on the telecommunications provider for such breaches. However, if a provider, which has been given a direction, breaches that direction (for example, by contravening the TCP Code again), the ACMA can commence proceedings in the Federal Court seeking a pecuniary penalty.
Since the TCP Code was registered in September 2012, the ACMA has:
- issued 153 formal warnings
- given 27 directions to comply
- given one infringement notice for contravening a direction to comply.