The slowdown, which takes the form of an emergency amendment to
the ICSTIS Code of Practice, will come into effect on 15th
September.
The amendment requires phone networks not to make payments to
their premium rate service providers for at least 30 calendar days
after calls have been made. This will give ICSTIS time to identify
breaches of its Code and, where appropriate, order phone networks
to withhold all payments pending the outcome of investigations.
The change is being introduced on an emergency basis to stamp
out the consumer harm that can be caused by rogue service
providers.
Some networks have been releasing monies to service providers
every few days or on a weekly basis for calls made to their
services. Such a payment structure enables service providers that
have set up or are running an operation in serious breach of the
Code, to receive most, if not all, of their revenues for such
services and then, at worst, simply disappear.
Commenting on the amendment, ICSTIS Director George Kidd
said:
“The introduction of a 30-day payment
requirement is great news for consumers. Our action removes a major
incentive for rogue service providers – namely getting their hands
on the money as quickly as possible. This amendment brings back
some common sense in ensuring that networks pay service providers
on roughly the same terms as they themselves are paid.”
ICSTIS and Ofcom have also separately published details of a new
Memorandum of Understanding between the two organisations. This
sets out the clear division of responsibility between ICSTIS and
Ofcom.
Both the Memorandum of Understanding and the emergency amendment
fulfill key recommendations in last year’s Ofcom Review of the
Regulation of Premium Rate Services. The Review, conducted by Ofcom
with ICSTIS, was carried out at the Department of Trade and
Industry's request, and secured Ministerial approval in December
2004.
