Contents
Summary
Chapter
one – Introduction
Chapter
two – Comments on draft statement and the Director's response
Chapter
three – Conclusion
Annex
1 – Oftel's statement of policy on information gathering under
Section 145 of The Communications Act 2003
Annex
2 – Summary of the legal provisions
Summary
S.1 This document
includes at Annex 1 Oftel’s statement of policy on information gathering
under section 145 of the Communications Act 2003 ('the Act').
S.2 Essentially
the statement of policy cross-refers to recent Oftel statements that
have referred to policy on information gathering. In summary it is intended
that Oftel will seek all the information it needs to investigate a complaint,
a dispute, or own initiative investigation of a breach of condition,
using its formal powers under the Act. For other types of information
requests under the Act eg for statistical purposes and for market reviews,
Oftel hopes that these will be provided on a voluntary basis, but Oftel
will consider using formal powers if necessary.
S.3 Ofcom may from
time to time revise the statement as it thinks fit.
Chapter
1 – Introduction
1.1 The Communications
Act came into effect on 25 July 2003.
1.2 Ofcom will not
be in a position to assume its duties under the Act until late 2003.
By virtue of the Communications Act 2003 (Commencement No. 1) Order
2003 (SI 2003/1900 (C.77) the powers granted to Ofcom under Part 2 of
the Communications Act 2003 (the 'Act') have been conferred upon the
Director General of Telecommunications (the "Director") for
a transitional period until such time as those provisions are commenced
for Ofcom.
1.3 The Act gives
Oftel wide powers to request information for the purpose of carrying
out its functions under Chapter 1 of Part 2 of the Act, with respect
to electronic communications networks and services. Failure to comply
with an information requirement or providing false information, could
result in financial penalties being imposed by Oftel and/or criminal
proceedings. The Act also places restrictions on the exercise of these
powers which includes, that requests must be proportionate to the uses
to which the information is to be put, and persons
to whom requests are made must be given a reasonable period to provide
the information.
1.4 Section 145
of the Act places a duty on Oftel to publish and keep up-to-date a statement
of policy on how it will exercise its information gathering powers under
section 135 and 136 and how it will use any information obtained in
exercise of those powers. When exercising its information gathering
powers under sections 135 to 144, Oftel must have regard to this published
policy statement.
Chapter
2 – Comments on draft statement and the Director’s response
2.1 Oftel issued
a draft statement for consultation on 24 April 2003 (see www.oftel.gov.uk/publications/about_oftel/2003/info0403.htm),
with a deadline of 20 June 2003. Comments were received from NIACT and
BT. NIACT’s short response was supportive of the draft statement. BT’s
comments are set out below along with the Director’s responses.
BT’s comment
2.2 Paragraph A1.2
in the introductory section of the policy statement gives a high-level
summary of Oftel’s powers to request information and of the penalties
which may be imposed for non-compliance. In BT’s view, to give a balanced
picture of the relevant sections of the Bill, this paragraph should
also refer to the principal restrictions to the exercise of these powers
ie that requests must only be made in defined circumstances, requests
must be proportionate to the uses to which the information is to be
put, and persons to whom requests are made must be given a reasonable
period to provide the information.
The Director’s
response
2.3 Paragraph A1.2
has been amended accordingly.
BT’s comment
2.4 In paragraphs
A1.7 and A1.8 of the statement, Oftel states that it will use formal
powers to investigate complaints, carry out own-initiative investigations,
or in relation to disputes, and that other types of information request
will be made initially on a voluntary basis.
2.5 Two of the other
categories of information which Oftel will be empowered to request are
information required to ascertain or verify a) the amount of any administrative
charge payable by a provider and b) any financial contributions towards
the cost of the universal service obligation. In BT’s view, it would
not be appropriate to rely on informal means in order to obtain information
for these purposes. Indeed, Oftel has stated in its May 2003 document
"Implementation of the Authorisation Directive's provisions on
notifications and fees" that it will use formal powers under Clause
132 [now section 135] to obtain the information needed to calculate
administrative fees under the new framework. It is particularly important
that Oftel should be able to insist on and enforce the provision of
information for this purpose so that it can ensure that administrative
charges are set on a proportionate and non-discriminatory basis. We
therefore suggest that paragraphs A1.7 and A1.8 of the statement be
amended accordingly.
The Director’s
response
2.6 The use of formal
powers mentioned in the May 2003 document (see www.oftel.gov.uk/publications/eu_directives/2003/notfees0503.htm),
is necessary at this stage, in view of the particular need to quickly
ascertain and verify administrative charges during the transition to
the new regime. Different circumstances should apply in future years.
Therefore, there is no need to amend paragraphs A1.7 and A1.8.
BT’s comment
2.7 BT considers
it essential that Oftel’s decision-making in market reviews is based
on comprehensive information. Without complete, high quality market
information, Oftel will be unable to assess accurately the effectiveness
of competition in the markets under review, and this could lead to the
making of unjustified Significant Market Power designations and the
imposition of inappropriate remedies. Similar considerations apply to
reviews of Universal Service designations and obligations. In view of
these risks, we believe the policy should state explicitly that Oftel
will move speedily to the use of formal powers when the voluntary approach
fails to deliver promptly information needed for market analysis or
universal service reviews.
The Director’s
response
2.8 The Director
believes that the current wording of paragraph A1.8 is sufficient.
BT’s comment
2.9 Paragraph A1.9
describes the standard process Oftel will follow when using formal powers:
a draft information request will be sent out, and recipients will be
given five working days to comment on the relevance of the information
sought, the availability of other relevant information, and the practicality
of providing the information in the given timescale.
2.10 BT believes
that Oftel should also seek and take into account comments on the proportionality
of the information request. Not only does Clause 134 of the Bill [now
section 137 of the Act] require that any information request be proportionate
to the use to which the information will be put; in addition, Oftel
will have a general duty under the Bill to have regard to the principles
of good regulation, one of which is proportionality.
The Director’s
response
2.11 The wording
of paragraph A1.9 has been amended to include the words "in particular",
and therefore makes it clear that comments can be made on a draft information
request on matters other than those set out in the paragraph, including
comments on proportionality.
BT’s comment
2.12 The final sentence
of paragraph A1.9 states that having received any comments from recipients
of information requests, "Oftel will then generally confirm or
amend the information request within two working days and would not
normally expect to agree to an extension of the deadline specified in
the final request".
2.13 In our view,
the sentence quoted above is ambiguous, and may be interpreted to indicate
inflexibility regarding response times. We believe this is unintentional,
particularly as Clause 132 of the Bill [now section 135 of the Act]
requires that persons required to provide information must be given
a reasonable period to respond.
The Director’s
response
2.14 The wording
of paragraph A1.9 has been changed to "…Following receipt of
comments Oftel will then confirm or amend the information request, generally
within two working days. Oftel would not normally agree to any subsequent
changes to the final request, including the deadline to the final request".
BT’s comment
2.15 BT agrees that
wherever possible, Oftel should use information already in its possession
in order to minimise the burden on stakeholders and ensure that decisions
can be taken within appropriate timescales. However, we would like to
note that in some cases, there may be a danger of using information
which is out-of-date or for purposes significantly different from those
for which it was originally collected. We suggest that before relying
on such information, it may be appropriate for Oftel to confirm with
stakeholders whether it is relevant in the context in which it is to
be used.
The Director’s
response
2.16 The wording
of paragraph A.11 has been changed to include "…If Oftel
already holds information then before relying on such information, where
appropriate, Oftel will confirm with the source of the information that
the information is still up to date and is relevant in the context in
which it is to be used".
BT’s comment
2.17 Annex 2 paraphrases
the relevant clauses of the Bill. We believe a more transparent approach
would be to reproduce the clauses themselves and to give any necessary
explanation in the form of a commentary. At the least, we suggest that
the headings in Annex 2 should be expanded to refer to the clauses to
which the following text refers. This would make it easier for stakeholders
to understand and verify Oftel’s interpretation of the legal provisions.
The Director’s
response
2.18 Annex 2 has
been amended to include headings which relate to the relevant section
under the Act.
Chapter
3 – Conclusion
3.1 The final statement
under section 145 of the Act and a summary of the legal provisions are
shown in Annex 1 and Annex 2 respectively.
Annex
1 – Oftel’s statement of policy on information gathering under
Section 145 of The Communications Act 2003
Introduction
A1.1 By virtue of
the Communications Act 2003 (Commencement No. 1) Order 2003 (SI 2003/1900
(C.77)), the powers granted to Ofcom under Part 2 of the Communications
Act 2003 (the "Act") have been conferred upon the Director
General of Telecommunications (the "Director") for a transitional
period until such time as those provisions are commenced for Ofcom.
A1.2 The Act gives
Oftel wide powers to request information for the purpose of carrying
out its functions under Chapter 1 of Part 2 of the Act (eg to investigate
breaches of conditions and to carry out market reviews) with respect
to electronic communications networks and services. Failure to comply
with an information requirement or providing false information, may
result in financial penalties being imposed by Oftel and/or criminal
proceedings. The Act also places restrictions on
the exercise of these powers which includes, that requests must be proportionate
to the uses to which the information is to be put, and persons to whom
requests are made must be given a reasonable period to provide the information.
A1.3 Section 145
of the Act places a duty on Oftel to publish and keep up-to-date a policy
statement on how it will exercise its information gathering powers under
section 135 and 136 and how it will use any information obtained in
exercise of
those powers. When exercising its powers under sections 135 to 144,
Oftel must have regard to this published policy statement.
A1.4 This statement
sets out Oftel’s statement of policy on the exercise of Information
gathering powers under sections 135 and 136 of the Act.
A1.5 A summary of
the legal provisions is included in Annex 2. Neither this statement,
nor Annex 2, is intended to include a definitive interpretation of the
law; therefore reference should also be made to the text of the Act.
A1.6 In addition
to this statement reference should also be made to Oftel’s previous
statements on its regular market information data collection process
(Conclusions from a review of Oftel’s regular industry data collection,
23 July 2002, www.oftel.gov.uk/publications/market_info/2002/info0702.htm),
data gathering for EU market reviews (Data gathering for EU market
reviews, 19 September 2002, www.oftel.gov.uk/publications/eu_directives/2002/data0902.htm),
and on dispute resolution under the new EU Directives (Dispute resolution
under the new EU Directives, 28 February 2003, www.oftel.gov.uk/publications/eu_directives/2003/eud0203.htm).
Oftel’s policy
A1.7 In carrying
out its functions under Chapter I of Part 2 of the Act Oftel needs a
solid evidence base upon which to base its decisions. In order to meet
new deadlines Oftel will need to exercise its formal information gathering
powers more frequently. As a general rule, for casework, Oftel will
seek all the information that it needs to investigate a complaint or
own initiative investigation of a breach of condition, using its formal
powers under section 135 and 136. For
disputes formal powers will generally be used under section 191.
A1.8 For other types
of information requirements under the Act eg for statistical purposes
or to carry out a market review, Oftel hopes that information will be
provided on a voluntary basis and in particular that suppliers will
continue to contribute to its regular market information programme.
Oftel believes that there are benefits to suppliers in terms of efficient
and accurate decision making if a regularly updated and comprehensive
database is maintained. However, for these other types of information
requirements Oftel will consider using formal powers if necessary.
A1.9 If formal powers
are used Oftel’s standard practice is – and continues to be – to send
a draft of the information request and offer five working days for comment,
in particular on the relevance of the information sought, other relevant
data which may be available and the practicality of providing the information
in the given timescale. Following receipt of comments Oftel will then
confirm or amend the information request, generally within two working
days. Oftel would not normally agree to any subsequent changes to the
final request,
including the deadline to the final request.
A1.10 As set out
in section 137(3), any formal demands made by Oftel must be proportionate
to the use to which it intends to put the information, and must describe
the information required and state the reasons why it is required. Unless
the demand is for the purpose of determining who is liable to a charge
under section 38 (in which case other appropriate methods may be used)
any demand must be set out in a notice and be served on the person from
whom the information
is requested.
A1.11 Oftel holds
a significant amount of in-house information and collects a wide range
of data on various aspects of the industry. Wherever possible, Oftel
will draw from existing information sources, however, despite this comprehensive
evidence base there will remain specific areas where it is necessary
to collect additional data. If Oftel already holds information then
before relying on such information, where appropriate, Oftel will confirm
with the source of the information
that the information is still up to date and is relevant in the context
in which it
is to be used.
A1.12 The uses to
which Oftel proposes to put information obtained under section 135 and
136, derives from the types of information requirements permitted under
those sections (as set out in paragraphs A2.2 and A2.3 below). However,
Oftel is conscious of the need to ensure that the process of requesting
information minimises the burden placed on those from whom information
is requested. Oftel will seek to avoid unnecessary duplication of effort,
by relying, as far as possible, on its existing information sources.
Annex
2 – Summary of the legal provisions
PERSONS COVERED
BY AN INFORMATION REQUIREMENT
SECTION 135(2)
A2.1 Under this
section Oftel may require information, subject to limitations below,
from the following persons -
(a) a communications
provider;
(b) a person who
has been a communication provider;
(c) a person
who makes, or has made, any associated facilities available to others;
(d) a person,
other than a communications provider, to whom a universal service condition
applies or has applied;
(e) a
person who supplies electronic communications apparatus; and
(f) a person
not falling within the preceding paragraphs who appears to Oftel to
have information required by them for the purpose of carrying out their
functions under Chapter I of Part 2 of the Act.
CATEGORIES OF
INFORMATION REQUIREMENTS
SECTION 135(3)
A2.2 Under this
section Oftel may request information for any one or more of the
following purposes, including –
(a) investigating
possible breaches of conditions or other requirements imposed under
Chapter 1 of Part 2 of the Act, or of the code, or of a transitional
scheme after the cessation of the application of the electronic communications
code;
(b) ascertaining
or verifying the amount of any administrative charge payable under section
38, or of any financial contribution towards the cost of complying with
universal service obligations;
(c) ascertaining
whether a condition set under section 45 continues to be effective;
(d) designating
a universal service provider under section 66;
(e) carrying
out a review under sections 66 or 70 (see note one
below);
(f) identifying
markets and carrying out market analyses for the purposes of Chapter
1 of Part 2 of the Act;
(g) assessing
whether any network access question has arisen which gives rise to a
duty under section 105 (see note two below) and
considering any matter while exercising that duty; and
(h) statistical
purposes connected with Oftel's functions under Chapter 1 of Part 2
of the Act.
SECTION 136
A2.3 Under this
section Oftel may also require communications providers and persons
making available associated facilities to provide Oftel with information
necessary
to enable Oftel:
(a) to carry out
comparative overviews of the quality and price of public electronic
communications services;
(b) for related
statistical purposes.
LIMITATIONS ON
INFORMATION REQUIREMENTS
SECTION 137
A2.4 Under this
section Oftel may not use their powers to request information relating
to a potential breach of a general condition unless Oftel’s investigation
is in response to a complaint; they have reason to believe that a breach
has occurred; they have decided to investigate to see whether the condition
is being complied with; or the condition concerns sharing the burden
of providing a universal
service.
A2.5 Any demands
made by Oftel must be proportionate to the use to which it intends to
put the information, and must describe the information required and
state the reasons why it is required. Unless the demand is for the purpose
of determining
who is liable to a charge under section 38 (in which case other appropriate
methods may be used) any demand must be set out in a notice and be
served on the person from whom the information is requested.
NOTIFICATION
OF CONTRAVENTION OF INFORMATION REQUESTS
SECTION 138
A2.6 Where Oftel
has reasonable grounds to believe that a person is or has been in breach
of any requirement under section 135 or 136, they may notify that person
accordingly, and allow him a specified period of time (usually one month)
in which to make representations to Oftel, and to take steps to comply
with the notified requirement.
PENALTIES FOR
CONTRAVENTION OF INFORMATION REQUIREMENT
SECTION 139
A2.7 Under this
section where a notified provider has not complied with a requirement
notified under section 138, has not remedied the consequences of the
notified contravention and no proceedings for an offence under section
144 have been brought, Oftel may impose a penalty. In deciding on the
amount of a financial penalty, Oftel are required to consider whether
the penalty is appropriate
and proportionate, and to take account of any representations made by
the person concerned and any steps taken by him to comply with the condition
or restriction in question. The maximum fine that may be imposed under
this section is £50,000. Secretary of State may by order amend this
provision
so as to substitute a different maximum penalty.
SUSPENDING SERVICE
PROVISION FOR INFORMATION CONTRAVENTIONS
SECTION 140
A2.8 This section
gives Oftel a power to suspend or restrict a person's entitlement to
provide electronic communications networks, electronic communications
services and/or associated facilities where Oftel is satisfied that
that person is in serious and repeated breach of any requirements imposed
on him under section 135 or 136, that the requirements are not requirements
imposed for the purposes connected with the carrying out of Oftel's
functions in relation to SMP apparatus conditions and that an attempt
by the imposition of penalties under section 139 or the bringing of
proceedings for an offence under section 144, to secure compliance has
failed. The suspension or restriction must be appropriate and proportionate
to the seriousness of the repeated contraventions.
A2.9 A direction
by Oftel under section 140 may suspend entitlement generally or in relation
to particular networks, services or facilities and may take effect indefinitely
or for a fixed period. Where Oftel exercise these powers, it must allow
the person in question to make representations to it and, if appropriate,
Oftel may revoke the suspension or restriction. A direction may also
include, where appropriate, conditions to protect the customers of the
contravening provider, including the payment of compensation.
SUSPENDING APPARATUS
SUPPLY FOR INFORMATION CONTRAVENTIONS
SECTION 141
A2.10 This section
gives Oftel a power to suspend or restrict a person from supplying electronic
communications apparatus where Oftel is satisfied that that the person
is in serious and repeated breach of any requirement of Oftel to provide
information for the purpose of section 135, and that an attempt, by
the imposition of penalties under section 139 or the bringing of proceedings
for an offence under section 144, to secure compliance has failed. The
suspension or restriction
must be appropriate or proportionate to the seriousness of the repeated
contraventions.
A2.11 A direction
by Oftel under section 141 may require a person to cease supplying electronic
communications apparatus generally or in relation to particular electronic
communications apparatus. The direction may take effect indefinitely
or for a fixed period. A direction may also include, where appropriate,
conditions to protect the customers of the contravening supplier, including
the payment of compensation. When Oftel exercise these powers, it must
allow the person in question to make representations to it and, if appropriate,
Oftel may revoke
the suspension or restriction.
PROCEDURE FOR
DIRECTIONS SUSPENDING SERVICE PROVISION/APPARATUS SUPPLY FOR INFORMATION
CONTRAVENTIONS
SECTION 142
A.2.12 Under this
section , unless the case is urgent, before exercising its powers under
sections 14037 and 141, Oftel must notify a contravening provider or
supplier of the proposed direction, allow him at least one month to
make representations and consider each representation made by him. The
meaning of an urgent case is set out in section 142(4) and (5). Such
a case arises where there is a serious threat to public safety, public
health or national security or a serious economic or operational problem
that makes it inappropriate to give a contravening provider or supplier
time to make representations.
A2.13 If a case
is urgent, Oftel may give a direction without consulting the contravening
provider or supplier. However, as soon as practicable after giving a
direction in an urgent case, Oftel must provide the relevant contravening
provider or
supplier with an opportunity to make representations and to propose
steps to remedy
the contravention.
ENFORCEMENT OF
DIRECTIONS SUSPENDING SERVICE PROVISION/APPARATUS SUPPLY FOR INFORMATION
CONTRAVENTIONS
SECTION 143
A2.13 Under this
section it is an offence for any person to provide an electronic communications
network, an electronic communications service or an associated facility
while he is subject to a direction issued under section 140 suspending
his entitlement to do so or where he does so in contravention of any
restriction
specified in the direction. It is also an offence for any person to
supply electronic
communications apparatus while he is subject to a direction issued under
section 141 suspending his entitlement to do so or where he does so
in contravention
of any restriction specified in the direction. A person found guilty
of either
offence will be liable to a fine.
OFFENCES IN CONNECTION
WITH INFORMATION REQUIREMENTS
SECTION 144
A2.14 Under section
144 it is an offence for any person to fail to provide information in
response to a demand from Oftel under section 135 or 136- and any such
person shall be liable to a fine. However, subsection (2) makes provision
for a defence where it is not possible for the recipient of a notice
to provide the information within the period specified by Oftel but
the recipient has taken all reasonable steps to provide the information
after that period. No proceedings for this offence may be brought in
respect of failures for which Oftel has
imposed a financial penalty under section 139.
A2.15 It is also
an offence intentionally or recklessly to provide Oftel with any false
information in response to a request under section 135 or 136 and a
person guilty of this offence is liable to a fine and/or imprisonment.
OFTEL'S POWER
TO REQUIRE INFORMATION IN CONNECTION WITH DISPUTE
SECTION 191
A2.16 This section
gives Oftel powers to require parties to disputes and other persons
to provide them with information that enables Oftel to:
(a) decide whether
it should handle a dispute;
(b) determine
whether it needs to consult the regulatory authorities of other EU Member
States; and
(c) consider
and determine a dispute.
A2.17 Information
requested by Oftel must be provided within the period specified by Oftel.
Requests for information under section 191 may be enforced by Oftel
using the procedure set out in clauses 138 to 144 (paragraphs A2.6 to
A2.15 above).
Notes:
1.
Section 66 - Designation of universal service providers. Section 67
- Subject matter of universal service conditions. Section 68 - Tariffs
etc. for universal services. Section 69 - Directories and directory
enquiry facilities. Section 70 - Review of compliance costs.
2. Section 105 allows Oftel to exercise their
powers under Chapter 1 of Part 2 of the Act, to set, modify or revoke
(a) access-related conditions authorised by section 73(2) or (4); and
(b) SMP services conditions authorised by section 87.
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