Notice to Industry: Launch of the Registration Scheme in support of the 12th Edition of the PhonepayPlus Code of Practice

NOTICE TO INDUSTRY – LAUNCH OF THE REGISTRATION SCHEME IN SUPPORT OF THE 12TH EDITION OF THE PHONEPAYPLUS CODE OF PRACTICE

Issued on 27 April 2011

  FOR THE ATTENTION OF ALL THOSE INVOLVED IN PROVIDING PREMIUM RATE SERVICES FOR THE PURPOSES OF SECTION 120 OF THE COMMUNICATIONS ACT 2003

Background

A Notice was issued by PhonepayPlus on 30 March 2011 to inform all those who provide premium rate services for the purposes of section 120 of the Communications Act 2003, that the 12th Edition of the PhonepayPlus Code of Practice (“12th Code”) had been published and approved by Ofcom on 30 March 2011, and would come into force on 1 September 2011.

The Notice of 30 March 2011 drew particular attention to certain requirements of the new Code, including the requirements to register organisations and premium rate services with PhonepayPlus and a requirement not to contract with other Network operators, Level 1 and Level 2 providers unless they are registered with PhonepayPlus.

About this Notice

This Notice is to inform all those who provide premium rate services (PRS) for the purposes of section 120 of the Communications Act 2003, that the Registration Scheme which providers must use to register, and which they can use to perform checks on other registered parties, has been launched on 27 April 2011 to allow for registration ahead of the 12th Code of Practice coming in to force. In addition, this Notice is to draw attention to the provisions of the 12th Code relating to registration, and how PhonepayPlus will interpret those provisions.

Requirement to register

This is a requirement by virtue of paragraph 3.4.1 of the 12th Code which provides that:

3.4.1 – Before providing any premium rate service all Network operators, Level 1 and Level 2 providers must register with PhonepayPlus subject only to paragraph 3.4.3 below [exempt services]

For the avoidance of doubt, all Network operators, Level 1 and Level 2 providers who intend to provide premium rate services from 1 September 2011 onwards must register with PhonepayPlus by that date. This is with the exception of those who provide “exempt services”, as set out later in this Notice. 

In any corporate group structure, any and all companies within the group which are themselves Network operators, Level 1 providers or Level 2 providers, as defined by the Code, will be required to register.

The definitions of Network operator, Level 1 provider and Level 2 provider are at paragraphs 5.3.4, 5.3.8(a) and 5.3.8(b) of the 12th Code respectively. PhonepayPlus has also published a General Guidance Note on the ‘Definitions of those involved in providing PRS’ which can be viewed on its website.

Notice of registration fee for 2011/12

Payment of a registration charge is a requirement of paragraph 3.4.7 of the 12th Code which provides that:

3.4.7     PhonepayPlus will make a reasonable charge for such registration and for annual renewal of registration.  PhonepayPlus will set the amount of the charge, giving reasonable notice to interested parties.  All Network operators, Level 1 and Level 2 providers who wish to register must pay the charge

In order to register during the financial year 2011/12, registrants are required to pay a fee of £100+VAT. In future years, this fee may vary up or down, according to numbers of registrants and other relevant factors. PhonepayPlus will issue notice of any future changes to the fee as appropriate. The accepted methods of payment are UK credit and debit cards.

Exemptions from a requirement to register

Paragraphs 3.4.2 and 3.4.3 of the Code state:

3.4.2     PhonepayPlus may identify particular categories of premium rate services in respect of which registration will not be required (‘exempt services’).  PhonepayPlus will provide public notice of any such exempt services and will publish a full list of exempt services from time to time

3.4.3     Network operators, Level 1 and Level 2 providers who provide only exempt services are not required to register with PhonepayPlus

PhonepayPlus hereby draws attention to the following services and providers who are exempt from the requirement to register with PhonepayPlus:

Exempt services

• Services provided on the 0871/2/3 number range

Exempt Network operators, Level 1 and Level 2 providers

• Those who provide services only on the 0871/2/3 number range

This exemption is initially for a 12-month period from 1 September 2011.

In addition, the following types of organisation will be required to register, but will not be required to pay a registration fee:

• Charities engaged in PRS activity, which are registered as charities in England, Wales, Northern Ireland or Scotland. Charities registered as being such only in foreign jurisdictions will not be exempt from a requirement to pay the registration fee;
• Organisations who earn less than £5,000 in total revenue from premium rate services.

For the avoidance of doubt, “organisations who earn less than £5,000 in total revenue from premium rate services” relates to Level 2 organisations whose gross outpayments received from one or more Level 1 providers to whom they are contracted is £5,000 or less during the annual period from the date of their registration to the due date of renewal of their registration.

To qualify for exemption, a provider must provide the registration number(s) of one or several registered premium rate providers from whom they receive outpayments, so that PhonepayPlus can verify the claim for exemption from the requirement to pay a registration fee.

Providers whose premium rate revenue exceeds £5,000 during the year they are registered will be required to update their registration status from “exempt” to “payable” by contacting PhonepayPlus in the first instance. Upon receiving contact from a provider, PhonepayPlus will update their registration and request payment of the fee from the date the organisation declared itself to be earning revenue over £5,000. The registration will then be valid for 12 months from this new date.

These exemptions from the requirement to pay a registration fee are initially for a 12-month period from 1 September 2011.

Information required from those who register

Paragraph 3.4.4 of the 12th Code provides that:

3.4.4     Registration will require the provision of such information as PhonepayPlus may from time to time require for the purpose of efficient and effective regulation of premium rate services

It will be the responsibility of all organisations who register to:

• Complete registration fully and provide all mandatory information;
• Pay the registration fee (with the exception of those who are exempt from payment).

Information which is mandatory for those registering is as follows:

Private limited companies (including those with charitable status), public limited companies, foreign companies (i.e. those who are registered outside the UK):

• Organisation name;
• Organisation address;
• Full name, email address and date of birth of all Directors;
• Companies House number (if applicable);
• Registered charity number (if applicable);
• Trading name(s);
• Address for receiving instructions and regulatory contact number and email address.

Partnerships and foreign partnerships (normal or limited liability):

• Organisation name;
• Organisation address;
• Full name, email address and date of birth of all partners or members (the names of partners will not be required during the initial registration process, but registrants will need to provide this information once registered, by accessing the ‘Directors’ tab within their registration account);
• Trading name(s);
• Address for receiving instructions and regulatory contact number and email address.

Trusts:

• Organisation name;
• Organisation address;
• Full name, email address and date of birth of all trustees (the names of trustees will not be required during the initial registration process, but registrants will need to provide this information once registered, by accessing the ‘Directors’ tab within their registration account);
• Trading name(s);
• Address for receiving instructions and regulatory contact number and email address.

Sole traders:

• Sole trader full name and date of birth;
• Organisation address;
• Trading name(s);
• Address for receiving giving instructions and regulatory contact number and email address.

Public/’Third” sector organisations (including bodies, agencies and authorities):

• Organisation name;
• Organisation address;
• Full name, email address and date of birth of all non-executive directors (the names of non-executive directors will not be required during the initial registration process, but registrants will need to provide this information once registered, by accessing the ‘Directors’ tab within their registration account);
• Trading name(s);
• Address for receiving instructions and regulatory contact number and email address.

Pre-registration by one organisation on behalf of another

Any party within a premium rate value-chain, in the period leading up to the 1 September when the 12th Code comes into force, may pre-register organisational information about other organisations subject to the following conditions:

• The party who is pre-registering another party must themselves be registered as an organisation on the Registration Scheme;
• Data must be provided in the prescribed spreadsheet as provided by PhonepayPlus;
• The party pre-registering other organisations must be registering more than 50 organisations;
• Spreadsheets containing errors will be rejected. PhonepayPlus will endeavour to identify the causes to enable you to resubmit.

It remains the responsibility of organisations who have been pre-registered by other organisations to validate the information provided, ensure the registration contains all mandatory information and make payment where required to do so.

Updating of information

This is a requirement of paragraph 3.4.5 of the 12th Code which provides that:

3.4.5  Information provided to PhonepayPlus for the purposes of registration must be updated as soon as is practicable

Organisations are obliged to ensure that information relating to their registration remains complete and accurate. PhonepayPlus will not validate every entry on the database due to the operational costs of doing so, but may monitor the completeness of registration data. Non-compliance with the requirements of registration may result in informal or formal procedures, as appropriate, being initiated.

It will be a breach of the Code to provide incomplete or inaccurate information on the Registration Scheme. In the event of any investigation into the registration status of an organisation, PhonepayPlus will consider the extent to which registration details are complete and accurate.

Where registered parties perform due diligence checks on other registered parties using the database, it is their responsibility to ensure that the information on which they are relying is complete and accurate.

Renewal of registration

This is a requirement of paragraph 3.4.6 of the 12th Code which provides that:

3.4.6       Registration must be renewed annually or at intervals determined by PhonepayPlus

Registration renewal notices will be sent to the regulatory contact stored on the Registration Scheme in advance of the renewal date. Renewal of registration and payment of the annual fee, where appropriate, must be made without delay. For the period 2011/2012, eligible organisations must register by 1 September 2011.

De-registration

Paragraph 3.4.10 of the 12th Code which provides that:

3.4.10   A registered party which is not providing any premium rate service or is providing only exempt services may de-register at any time but their details will continue to be held by PhonepayPlus for a reasonable period

PhonepayPlus hereby gives notice that organisations that de-register will not be offered a full or partial refund of any registration fees paid.

Due diligence and risk assessment checks using the Registration Scheme

Paragraphs 3.3.2 and 3.4.8 of the 12th Code provides that:

3.3.2     In connection with the provisions of premium rate services which are not exempt services (see paragraph 3.4.2 below), Network operators, Level 1 and Level 2 providers must only contract with other Network operators, Level 1 or Level 2 providers which are registered with PhonepayPlus

3.4.8     All breaches and sanctions imposed under this Code (this edition and any previous editions) on any Network operator, Level 1 or Level 2 provider will be linked to that Network or provider’s registered details together with any relevant information arising from adjudications concerning associated individuals or any other relevant information which is publically held

Once the database has been populated, and before commencement of the requirement to register on 1 September 2011, registered providers will be able to search the information provided by other registered providers on the database. It is the obligation of the organisation using the database to undertake sufficient checks to be satisfied that the information on which they are relying is complete and accurate.

Should there be an investigation into a breach of paragraph 3.1.3 of the 12th Code in relation to a failure to assess and control the risk which a client had presented, a record of any check performed, or otherwise, will be used as evidence.

What a due diligence or risk assessment check will display

In addition to information about a registered party and its director(s), the database will also make available to anyone who performs a check any breaches that an organisation has had on record over the previous three years (for breaches regarded as “serious” by a PhonepayPlus Tribunal) or five years (for breaches regarded as “very serious”).

As organisations register with PhonepayPlus, any relevant breaches will be matched against their record on the database. Organisations that have not registered, but which have breaches against them in the relevant period, will show up on the database where a due diligence check is performed.

PhonepayPlus will also match information of individuals who are associated with previous breaches of the Code to their current and new organisation’s record, so that future potential business partners are fully aware of the individual’s track record and can then undertake effective risk assessment before doing business with them.

PhonepayPlus will also match directors and owners who register as being responsible for more than one provider, so that when that director’s or owner’s organisation is in breach of the Code, this information will be shared on the database. Before such information sharing takes place, PhonepayPlus will offer individuals the chance to validate the connection before it takes an evidence-based decision.

Trial period during which information about ongoing investigations will be displayed on the database

For an initial six-month trial, commencing from 1 September 2011, any checks will also display ongoing investigations into the party against whom the check is being performed. An “ongoing investigation” would, for this purpose, be characterised as follows:

• An investigation proceeding under the Track 2 or Emergency Procedure (as defined in the 12th Code) and for which either a formal request for information or a breach letter has been issued, whichever is the sooner, until such time as the investigation is completed.

Registration of services

Paragraph 3.4.12 of the 12th Code provides that:

3.4.12   Numbers

(a)  Level 2 providers must provide to PhonepayPlus relevant details (including any relevant access or other codes) to identify services to consumers and must provide the identity of any Level 1 providers concerned with the provision of the service

(b)  PhonepayPlus will include all such details on the PhonepayPlus Register and those details will be available to be checked directly by consumers

(c)  Whenever the information provided under sub-paragraph 3.4.12(a) above changes, the updated information must be provided to PhonepayPlus within two working days of the change

It is the responsibility of the Level 2 provider to ensure each of their services is registered on the database by 1 September 2011. This is to ensure that consumers can immediately check the identity of any service by entering a search on the database against the number or other access code, and obtain a customer care number in respect of the service.

The facility that relates to searches against numbers or other access codes, known as the Number Checker, will be introduced during the period of pre-enforcement to allow for the registration of services by 1 September 2011. The date that the Registration Scheme will be open for the registration of services to populate the Number Checker will be notified in due course.

Each organisation in the value-chain for a premium rate service, (excluding affiliates who would not be defined as a Network operator, Level 1 or Level 2 provider), must register as a provider before any service is provided to consumers.

Providers must register a service within two working days of it being provided to consumers.

Mandatory information when registering services

The mandatory information required for the registration of each service is:

• The PRS access number or code;
• The ID of the next contracted party in the value-chain (a Level 1 provider under the Code);
• The customer care telephone number;
• The ID of the company providing customer care.

In addition, the facility will exist to allow providers to populate further information on a voluntary basis in order to assist their consumers. This includes:

• Service name;
• Service type;
• Email address;
• Customer care information.

Any party associated with the delivery of a service can register that service and can assign themselves data ownership – i.e. the ability to amend or supply additional data. In effect, this allows Level 1 providers to register services on behalf of their Level 2 clients. For the avoidance of doubt, the Level 2 provider retains primary responsibility for ensuring services registered by another party comply with Part Two of the 12th Code.

Customer care numbers do not necessarily have to be operated by a Level 2 provider, provided there is a mechanism for receiving and considering consumer complaints as set out at Rule 2.6 of the 12th Code. The Level 2 provider will remain responsible for the operation of its customer care arrangements in compliance with the Code.

Where a service operates on a shared mobile shortcode, the Level 1 provider may choose to designate themselves as the customer care provider. The Level 2 provider retains responsibility for ensuring customer complaints and enquiries are handled in compliance with the Code, but the Level 1 provider will be responsible for ensuring that these complaints are quickly passed on to the Level 2 provider.

Enforcement

PhonepayPlus will continue to monitor premium rate services, and perform other such checks as are necessary, to ensure that the 12th Code is complied with. This will include monitoring of the Registration Scheme to ensure that it is being used in compliance with the Code of Practice.