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Xplosion Ltd

Publication Date
5 October 2018
Case Reference
111863
Procedure
Track 2
Adjudicated Party
Xplosion Ltd
Service Type
Competition and quizzes
Tribunal's final assessment
Very Serious
Sanctions
4.8.3 (b) Sanctions
4.8.3 (d) Sanctions
4.8.3 (g) Sanctions
4.8.3 (i) Sanctions
Breaches raised
Code 14 2.3.3 Fairness
Code 14 2.2.1 Transparency and Pricing
Code 14 2.3.1 Fairness
Code 14 4.2.3 Obligations of Providers of premium rate services
Code 14 3.4.14 (a) Numbers
Summary

The case concerned a weekly quiz competition subscription service operating under the brand name ‘QuizM8’ (the “Service”) on PayForIt (“PFI”) and shortcode 65065 (used for consumers to send STOP to unsubscribe from ‘QuizM8’, and for the sending of free Service initiation and reminder messages).

The Level 2 provider for the Service was Xplosion Limited (the “Level 2 provider”). The Level 2 provider had been registered with the Phone-paid Services Authority (the “PSA”) since 27 January 2015.

There was both a Level 1 provider and a “Sub Level 1 provider” in respect of the Service. The top Level 1 provider (which directly contracted with the mobile network operators) for the Service was Dynamic Mobile Billing Limited (“DMB”), formerly Oxygen8 Communications UK Limited.

The sub level 1 provider which contracted with DMB and then in turn contracted with the Level 2 provider for the Service was Dimoco Europe GmbH (“Dimoco”).

The Executive received 68 complaints concerning the Service since 9 August 2016. Complainants variously alleged that the Service charges were unsolicited.

The Executive raised the following potential breaches of the PSA Code of Practice 14th Edition (“the Code”):

  • Rule 2.3.3 – Consent to charge
  • Rule 2.2.1 – Transparency and pricing
  • Rule 2.3.1 – Fair and equitable treatment
  • Paragraph 4.2.3 – Failure to disclose information
  • Paragraph 3.4.14 (a) – Service registration

The Tribunal upheld all of the breaches of the Code raised The Level 2 provider’s relevant revenue in relation to the Service was found to be £157,152.49. The Tribunal considered the case to be Very Serious and imposed a formal reprimand, a fine of £250,000, a prohibition on the Level 2 provider from providing or having any involvement in any premium rate service for a period of 5 years from the date of the Tribunal decision or until payment of the fine and administrative charges, whichever is the later.

The Tribunal also imposed a requirement that the Level 2 provider must refund all consumers who claim a refund, for the full amount spent by them on the Service, within 28 days of their claim, save where there is good cause to believe that such claims are not valid, and provide evidence to the PSA that such refunds have been made.

Administrative charge recommendation: 100%