Own-initiative enforcement programme to give effect to General Condition 22 (Service Migrations)

05 November 2009

Complainant: Ofcom own-initiative
Complaint against: Communications providers offering broadband (DSL) services
Case opened: 14 February 2007
Case closed: 4 November 2009
Issue: Compliance with the MAC Broadband Migrations Process and general obligations applicable to migrations
Relevant instruments: General Condition 22 of the General Conditions of Entitlement (GC22)

Ofcom is today announcing the closure of the GC22 enforcement programme that was first opened in February 2007, following the introduction of the new rules on broadband migrations.

There has been a significant decline in the complaint numbers since the introduction of the GC22 rules; falling from 825 in March 2007 to 147 in September 2009 (the lowest level since the opening of the enforcement programme). Over the past 12 months, the total number of MAC-related complaints received by Ofcom has more than halved. The reduction in complaints, alongside the evidence gathered through our enforcement activity and analysis, indicates that compliance has improved considerably across the industry and that most consumers are able to move easily and quickly to a new broadband provider of their choice.

As a part of the enforcement programme, we issued Pipex UK Ltd and Pipex Internet Ltd (collectively Pipex) with a section 94 notification in December 2008 for contravention of GC22 (see details below). Since issuing the notification, we have seen a significant decline in the number of MAC-related complaints received by Ofcom against Pipex. We are content that Pipex has taken steps to comply with the notification and Ofcom has now ceased its monitoring of Pipexs compliance with the notification.

Given this marked and consistent improvement across the industry, we have decided to close the enforcement programme. However, Ofcom will continue to actively monitor the MAC-related complaint levels. We have written to the ISPs with whom we had engaged (those who were attracting the most number of complaints), warning them that should we see an increase in complaints, or identify trends relating to any ISP, whether we have written to them or not, we will not hesitate to open individual investigations, which would be published on the Competition and Consumer Enforcement Bulletin.

End of update note

Update note: 14 May 2009

Ofcom is today announcing a further six month extension of our broadband migrations enforcement programme, which aims to ensure that customers can switch between broadband providers quickly and easily.

In the past 12 months there has been a considerable decrease in the total number of MAC-related complaints received by Ofcom. Complaint numbers have declined substantially and are currently at their lowest levels since the introduction of the GC22 rules on broadband migrations. While this indicates that compliance is improving across the industry, the enforcement programme has been extended in order to allow us to:

  • continue monitoring broadband providers level of compliance with the rules;
  • continue enforcement action taken against particular companies; and to
  • continue our work aimed at protecting consumers and improving compliance across the industry.

As part of this work we will continue to assess the compliance of Pipex UK Ltd and Pipex Internet Ltd with the notification that we issued in December 2008 (see details below). This work will allow us to judge whether or not any further enforcement action is necessary.

End of update note

Update note: 19 January 2009

The non-confidential version of the notification issued to Pipex UK Ltd and Pipex Internet Ltd on 12 December 2008 under section 94 of the Communications Act 2003 has now been prepared and the document can be found at the relevant link at the bottom of this entry.

End of update note

Update note: 15 December 2008

Ofcom is today announcing that it has issued a notification to Pipex UK Ltd and Pipex Internet Ltd (Pipex) under section 94 of the Communications Act 2003. The notification sets out that we have reasonable grounds to believe that Pipex has failed to meet its obligations in relation to customers who wish to migrate to another broadband provider.

The notification against Pipex comes at a time when the overall number of complaints to Ofcom from consumers having difficulty in switching broadband provider has declined significantly. Customers wishing to change broadband provider need to obtain a MAC (migration authorisation code) from the provider they are leaving. This allows them to change provider with minimal interruption to their broadband service.

In 2007 Ofcom introduced a new regulation (known as General Condition 22) to ensure that all broadband providers issue a MAC within five working days of receiving a request from their customers. The notification highlights a number of occasions where Pipex failed to abide by these rules and requires them to ensure that they are compliant by the deadline of 23 January 2009.

We will closely monitor Pipexs performance to ensure that it does now comply with the rules. If, following the January deadline, we believe that Pipex has failed to take appropriate steps to comply with the notification we will consider whether further enforcement action is necessary.

Pipex also has until 23 January to make representations to Ofcom about the notification.

We will publish a non-confidential version of the notification on this Bulletin shortly.

Update note: 14 November 2008

Ofcom is today announcing the extension of our broadband migrations enforcement programme, which aims to ensure that customers can switch between broadband providers quickly and easily.

The general improvement in complaints figures reflected in our last update on this case has been maintained in the past three months, however we are continuing to actively monitor these complaints figures and some other areas where improvements may be required.

We have therefore extended the enforcement programme by a further six months in order to decide whether to pursue any necessary enforcement action and to continue our monitoring of the industrys compliance with GC22.

End of update note

Update note: 15 August 2008

Ofcom is today providing an update on our enforcement programme which aims to ensure that customers can switch between broadband providers quickly and easily.  In February this year we announced an extension of our enforcement programme for a further six months because we were still receiving too many complaints from consumers who were not getting their MACs on time or were having other problems switching their broadband provider. 

The focus of the extended programme has been direct engagement over the course of six months with the broadband providers who were the subject of the most MAC -related complaints from consumers.  As a result of this action, these companies have reviewed their processes and procedures for providing consumers with MACs and made a range of improvements to these processes.

As a result of these improvements, the overall number of MAC -related complaints received by Ofcom has decreased substantially.  We will continue to monitor the compliance of these companies, and that of the rest of industry, to ensure that consumers can switch broadband providers without delay and with minimum inconvenience. To this end, the enforcement programme has been extended by a further three months.

End of update note

Update note: 28 May 2008

Non-confidential versions of the notification issued to Prodigy on 14 April 2008 under section 94 of the Communications Act 2003 and the notice issued to Prodigy under section 139 of the Act have now been prepared and are available from the link below.

End of update note

Update note: 14 April 2008

As part of this programme Ofcom has investigated consumer complaints that Prodigy Internet Ltd (Prodigy) is failing to comply with its obligations under GC22 (broadband migrations) and GC14.7 (membership of a dispute resolution scheme). We have concluded that there are reasonable grounds to believe that Prodigy has failed to comply with these obligations and have issued Prodigy with a notification under section 94 of the Communications Act 2003 (the Act).

Specifically, contrary to the requirements of GC14.7, the notification sets out evidence that Prodigy failed to comply with adjudication decisions made under the dispute resolution scheme and failed to pay the costs of those hearings. In addition, Prodigy has failed to maintain membership of a dispute resolution scheme.

Having investigated complaints made to Ofcom by consumers over a number of months, we have also set out evidence of Prodigy failing to provide MACs to some of its customers within five working days of receiving a request from them, and in some cases failing to provide MACs at all, contrary to the requirements of GC22.

Prodigy has until 15 May 2008 to cease its contraventions of GC14.7 and GC22 and to remedy the consequences of these contraventions. Failure to do so will lead Ofcom to consider issuing an enforcement notification under section 95 of the Act and/or imposing a financial penalty on Prodigy under section 96 of the Act.

A non-confidential version of the notification is being prepared and will be published shortly.

End of update note

Update note: 14 February 2008

Last February Ofcom introduced General Condition 22 (GC22), which amongst other measures, imposed a deadline of five working days for internet service providers (ISPs) to provide customers with a Migration Authorisation Code (MAC). The MAC is used by a consumer when switching from one providers service to another, where that service is being provided via DSL. In the 12 months since the introduction of this General Condition and the opening of Ofcoms enforcement programme to ensure compliance with this condition, the number of MAC -related complaints received by Ofcom has fallen, from 825 in March 2007, when the programme began, to 517 in January 2008. In the same period, the number of consumers requesting a MAC from their ISP has increased. Although the level of compliance with GC22 has therefore improved significantly over the period of the enforcement programme, we are concerned that the rate of improvement has not been maintained in recent months.

Ensuring that consumers are able to switch their broadband supplier quickly, easily and with minimal service disruption remains a priority for Ofcom. We have therefore decided to extend the GC22 enforcement programme for a further six months. Industry players should now expect that Ofcom may proceed directly to individual notifications of contravention without any further warnings where our investigation of an ISP demonstrates sufficient evidence of contravention of GC22.

During the period we will continue to provide support to the Office of the Telecommunications Adjudicator in its work to develop new processes with the industry that will facilitate broadband migrations.

End of update note

Update note: 14 November 2007

Ofcom has imposed a penalty of 30,000 on Prodigy Internet Ltd (Prodigy) following the failure of Prodigy to comply with requirements to provide information to Ofcom.

As part of its ongoing investigation into Prodigys compliance with GC22 and GC14.7, Ofcom issued a notice to Prodigy under section 135 of the Communications Act 2003 (the Act') requiring the provision of specified information. As Prodigy failed to comply with this notice, a notification under section 138 of the Act was issued to Prodigy on 31 May 2007. Prodigy also failed to comply with this notification.

Ofcom considers that Prodigy has failed to provide all the required information. Given Prodigys ongoing failure to comply with the section 135 notice and having followed the procedures set out in the Act, Ofcom has decided to impose a penalty of 30,000 on Prodigy. A non-confidential version of the penalty notice issued to Prodigy on 9 November 2007 under section 139 of the Act is currently being prepared and will be published shortly.

Ofcom's investigation into the activities of Prodigy continues.

End of update note

Update note: 13 August 2007

Over the last six months we have collected information from broadband providers in relation to the migration of broadband customers. This information, along with complaint data received by Ofcom, has been used to monitor compliance with GC22. Where we have identified comparatively high complaint levels we have held discussions with the relevant broadband provider to identify the cause of the complaints and bring about compliance with GC22. Where this approach has not succeeded, we have taken a more formal approach. Since the introduction of the enforcement programme, the number of complaints received by Ofcom about broadband migration issues has fallen by about half, from around 480 complaints per week at the start of March to around 250 complaints per week at the start of August.

Ensuring that consumers are able to migrate their broadband services quickly, easily and with minimal service disruption remains a priority for Ofcom and Ofcom has therefore decided to extend its programme of monitoring and enforcement of GC22 for a further six months.
In this period Ofcom will continue to monitor compliance with the rules on broadband migration, where necessary taking action to enforce those rules. Ofcom will also continue to provide support to the Office of the Telecommunications Adjudicator in its work to develop new processes with the industry that will facilitate broadband migrations.

End of update note

Update note: 8 June 2007

Following complaints that Prodigy Internet Ltd (Prodigy) was failing to comply with its obligations under GC22, Ofcom issued Prodigy with a notice under section 135 of the Communications Act 2003 (the Act) (the notice) on 25 April 2007. The notice required Prodigy to provide Ofcom with specified information by the deadlines of 27 April 2007 and 3 May 2007 to assist Ofcoms consideration of Prodigys compliance with GC22 and GC14.7 (requirement to implement and comply with a dispute resolution scheme). Prodigy failed to provide the required information by the deadlines and has, to date, failed to provide the information.

Ofcom has therefore issued Prodigy with a notification under section 138 of the Act (the notification), requiring Prodigy to provide the specified information. If Prodigy does not comply with the notification, Ofcom may impose penalties under section 139 of the Act or bring proceedings under section 144 of the Act.

A non-confidential version of the notification has been prepared and is available from the link below.

End of update note

Ofcom has launched an active enforcement programme to monitor compliance by broadband providers with new rules on broadband migration and, if necessary, to take action to enforce those rules.

On 13 December 2006, after public consultation, Ofcom imposed a new General Condition, GC22, governing the obligations of broadband providers to customers who are seeking to migrate between DSL -based broadband services. GC22 entered into force on 14 February 2007.

Under GC22, all broadband providers must use the MAC Broadband Migrations Process (the MAC process) if they receive a migration request from an end-user, customer or another provider. Details of the MAC process are set out in Annex 1 to GC22.

If the MAC process does not apply, communications providers are required to facilitate migration in a fair and reasonable manner, ensuring that migration is carried out within reasonable timescales and with minimal loss of service.

Ofcoms active enforcement programme will gather information from broadband providers about migrations and consider evidence of non-compliance, including numbers of complaints received by Ofcom. However, as now, Ofcom will not investigate individual consumers complaints.

Ofcom may initiate separate investigations of named providers which will be announced via Ofcoms Competition Bulletin or may move directly under this programme to take action where, for example, Ofcom has reasonable grounds for believing that a communications provider is contravening GC22. In that case, Ofcom will announce its action via an update to this Competition Bulletin entry.
If you are a consumer and wish to discuss this case please contact Ofcoms Advisory Team on 020 7981 3040 or 0300 123 3333.

Case Leader: Rapinder Newton ( e-mail:rapinder.newton@ofcom.org.uk)
Case Reference: CW/00946/02/07