Investigation into Cloud M’s provision of number portability

Ofcom has today published non-confidential versions of the final decisions document and the Confirmation Decisions issued to Cloud M on 29 November 2018:

Confirmation Decisions under s96C and s139A of the Communications Act 2003 (PDF, 1.0 MB)

Following an investigation, Ofcom has concluded that Cloud M has, in the respects notified under section 96A of the Communications Act 2003 (the “Act”), been in contravention of requirements imposed under General Condition 18¹ (“GC18”). Specifically, Ofcom has concluded that Cloud M contravened GC18 by failing to:

• provide Number Portability in the shortest possible time and on reasonable terms and conditions (GC18.1);
• provide Portability as soon as was reasonably practicable (GC18.5);
• provide reasonable compensation to the relevant customer in light of what we consider to be an abuse of porting (GC18.9); and
• set out information regarding porting compensation in clear, comprehensive and easily accessible form for its customer (GC18.10).

Accordingly, on 29 November 2018 Ofcom issued a Confirmation Decision to Cloud M under section 96C of the Act confirming its provisional decisions and imposing a penalty of £50,000 in respect of the contraventions. The Confirmation Decision also requires Cloud M to pay £1,000 to compensate the relevant customer for an abuse of the porting process.

Furthermore, following a parallel investigation concerning provision of information requirements, Ofcom has concluded that Cloud M has been in contravention of requirements notified under section 138 and imposed under section 135 of the Act. Specifically, Ofcom has concluded that Cloud M contravened requirements imposed within three separate information requests, by:

• not providing information that fell within the scope of the request; and
• not providing the information by the stipulated deadline.

Accordingly, on 29 November 2018 Ofcom also issued a Confirmation Decision to Cloud M under section 139A of the Act confirming its provisional decisions of 17 September 2018 and imposing a penalty of £5,000 in respect of the contraventions and a daily penalty of £100 (capped at £3,000) for each day that Cloud M continues with the second contravention noted above with respect of the information request dated 25 May 2018.

Prior to issuing the above Confirmation Decisions, Ofcom provided Cloud M with an opportunity to make representations about the matters notified under section 96A and section 138 of the Act, however, Cloud M did not provide any representations in response.

A non-confidential version of the Confirmation Decisions will be made available as soon as possible.

¹ On 1 October 2018, after the period examined as part of this investigation, revised General Conditions (PDF, 1.3 MB) came into force which include revised requirements in relation to Portability and Number Portability within Condition B3.

Following an investigation, Ofcom has determined that there are reasonable grounds for believing that Cloud M has contravened, and in some respects continues to contravene, General Condition 18. Accordingly, on 17 September 2018 Ofcom issued a notification to Cloud M under section 96A of the Communications Act 2003 (the “Act”).

Specifically, Ofcom has reasonable grounds for believing that Cloud M:

• failed to provide Number Portability in the shortest time possible and on reasonable terms and conditions (GC18.1);
• failed to provide Portability as soon as was reasonably practicable (GC18.5);
• failed to provide reasonable compensation to the relevant customer in light of what we consider to be an abuse of porting (GC18.9); and
• failed to set out in clear, comprehensive and easily accessible form for its customer, information regarding porting compensation (GC18.10).

Moreover, following an investigation Ofcom has determined that there are reasonable grounds for believing that Cloud M has contravened various requirements imposed under section 135 of the Act. Accordingly, on 17 September 2018 Ofcom also issued a notification to Cloud M under section 138 of the Act.

Cloud M now has an opportunity to make representations to Ofcom on the matters contained in the notifications before Ofcom makes confirmation decisions in accordance with sections 96C and 139A of the Act.

Ofcom issued Cloud M with an information request under section 135 of the Communications Act 2003, dated 25 May 2018. This information request related to a complaint made by a further complainant, Woods Foodservice Limited. This separate complaint also raised issues relating to Cloud M’s compliance with GC18. Ofcom therefore decided it was appropriate to issue an information request under this existing investigation into Cloud M’s compliance with GC18 to investigate the issues raised by Woods Foodservice Limited. Ofcom has now expanded this investigation to include considering whether Cloud M failed to respond to this information request by the stipulated deadline.

During this investigation Ofcom issued two information requests to Cloud M under section 135 of the Communications Act 2003, dated 8 March 2018 (the First Notice) and 26 April 2018 (the Second Notice). Ofcom has now expanded this investigation to include considering whether Cloud M responded fully to the First Notice and/or failed to respond to the Second Notice by the stipulated deadline.

When we opened this investigation, we stated that we would consider whether Cloud M has complied with its obligations under GC18.1, 18.5 and 18.9 in relation to number portability.

We now wish to clarify that the scope of the investigation is whether Cloud M has contravened or is contravening General Condition 18, including in particular, GC18.1, GC18.5, GC18.9 and GC18.10. See the full text of the General Conditions (PDF, 454.6 KB).

Number portability enables subscribers to retain the telephone number(s) used to identify them, when they switch communication providers (“CPs”). GC18 sets out the requirements that CPs must meet when dealing with number porting requests.

GC18.1 requires that CPs provide Number Portability within the shortest possible time, including subsequent activation, on reasonable terms and conditions to any of its subscribers who so request.

GC18.5 states that CPs must, pursuant to a request from another CP, provide Portability as soon as is reasonably practicable in relation to that request on reasonable terms. It also obliges CPs to ensure that any charges for the provision of Portability are made in accordance with the principles set out in GC18.5(a)-(c), including ensuring that charges are reasonable, cost orientated and based on the incremental costs of providing Portability, and do not act as a disincentive to subscribers against changing their CP.

Furthermore, GC18.9 states that CPs should pay reasonable compensation as soon as is reasonably practicable to a subscriber where there is a delay or abuse of the porting process by them or on their behalf.

On 2 January 2018, Ofcom opened an investigation into Cloud M’s compliance with GC18.1, GC18.5 and GC18.9. This investigation follows an allegation that Cloud M has inappropriately blocked a porting request in relation to a customer who wished to switch providers away from Cloud M and port the telephone numbers used to identify them.

Ofcom’s investigation will examine whether there are reasonable grounds for believing that Cloud M has failed to comply with its obligations under GC18.1, GC18.5 and/or GC18.9.