Consultations

The Phone-paid Services Authority is consulting on changes to the registration requirements for companies using or facilitating a premium rate charging mechanism and for each premium rate service that is to go live on any mobile or fixed network. There are also changes to the categorisation of services (e.g. Competitions and Quizzes) that are designed to assist the annual market report. Registration of companies assists the value chain to perform due diligence on their contracted parties. Registration of products and services was always designed to help consumers reconcile their telecom bill information to the merchant's contact details to facilitate discussion about the bill entry. A side benefit is also to assist PSA with market monitoring and with enquiries into services that have caused complaints to them. aimm believes that a majority of the proposed changes to the registration information being requested do not assist consumers, are excessive and will present an additional regulatory burden to providers as well as introducing inaccuracies and potential regulatory action when service promotions do not match registration detail. PSA have not, in our opinion, sufficiently justified the proposed changes by demonstrating the linkage between the requirements that will cause a significant burden to companies and the regulatory efficiency and effectiveness that could be delivered. aimm has responded on behalf of members to ensure these points are made and to prevent regulatory changes that create unnecessary burden on industry.  

The Phone-paid Services Authority (PSA) has set out it's FY 2018-19 budget for consultation. The operational budget is £3,849,585, the same as the previous year but with an estimated market size reduction of £20.5m represents an increase to 0.94% of the cost of regulation to the companies operating in the market. PSA have kept the levy to the funding networks the same at 0.44% of outpayments by utilising fine revenue for the other 0.5% While the budget is a real-time reduction on previous years, aimm believes that there may be costs and manpower levels being sustained through roles that may no longer be applicable, the use of technology, particularly consumer facing is outdated and the sustaining of the position of being the "de-facto go-to party" for consumers for complaint resolution (which is not their role) is overdue a review as this drives regulatory changes that add constraint to innovation and new services.  aimm believes that PSA should be taking dramatic steps alongside industry to resolve the significant consumer support issues that exist instead of constraining how digital merchants conduct their business. aimm also believes that monitoring, compliance and regulation is being performed by too many parties, indicating an ineffective overall regulatory environment, duplicated costs and further constraints on business, which do not support innovation and new services. Our draft response is now available for member comments and we will require feedback by 22nd January to enable us to meet PSA's deadline of 26th January. Please download the document below, add your comments and return to regulatory@aimm.co

Alternative dispute resolution (ADR) is an important part of the protection available to consumers with complaints about their communications provider (CP). All communications providers are required to be members of an Ofcom-approved ADR scheme. Consumers can take their complaint to ADR eight weeks after they have complained to their telecom providers or, before that, if their complaint has reached deadlock. The two approved ADR schemes: Ombudsman Services: Communications (“OS”) and the Communications and Internet Services Adjudication Scheme (“CISAS”) are positioned effectively for communications issues, but are not able to provide ADR for users of premium rate services. Under the Alternative Dispute Resolution for Consumer Disputes (Competent Authorities and Information) Regulations 2015, premium rate merchants have to refer consumers to ADR in a deadlocked situation. Due to the telecoms linkage they must refer to the only two companies approved by Ofcom. These companies do not provide the correct support for either side of the dispute and in aimm's view it creates impasse. aimm has encouraged Ofcom to review this situation as part of its review of the two ADR providers.

The Phone-paid Services Authority (PSA) launched a consultation on proposals to enhance effectiveness of sanctions imposed by PSA Tribunals on non-compliant providers.

They have been reviewing the effectiveness of their approach to sanctioning and whether their current approach effectively achieves the goal of preventing consumer harm, protecting the reputation of the market and creating a level playing field for industry. PSA are consulting on amendments to the sections of Supporting Procedures which set out the procedures adopted by the Tribunal when imposing sanctions. The proposed changes are to sections 12, 13 and 14 of the Supporting Procedures.

The Financial Conduct Authority (FCA) are consulting on two documents and the Payment Services Regulator (PSR) - a subsidiary of FCA - is consulting on their own Approach Document for the implementation of the revised Payment Services Directive (PSD2). Collectively the three documents constitute 522 pages.

• FCA Consultation Paper: Implementation of the revised Payment Services Directive (PSD2): draft Approach Document and draft Handbook changes. Link
• FCA Approach document: Payment Services and Electric [sic] Money – Our Approach. Link
• Payment Services Regulator (PSR) Approach Document: The PSR’s proposed approach to monitoring and enforcing the revised Payment Services Directive (PSD2). Link

The FCA consultation acknowledges its release in advance of any direction from HM Treasury related to issues stemming from responses to Treasury's consultation.

aimm's Position

aimm's response to the HM Treasury consultation formalised our previously identified and discussed issues relating to interpretation, cascade of exclusion and the financial impact of strict adherence. Read our response here: We are waiting for Treasury to respond to aimm. Inside the FCA consultation, two significant issues have been immediately identified 1. The description of "individual subscriber" which remains undefined in PSD2 and is a contradiction of defined terms elsewhere, is interpreted by FCA as the bill payer, not the user. 2. The FCA have for many years considered the intermediary role to be akin to Merchant Acquiring. The new term in PSD2 is Payment Acquiring. While aimm are negotiating a cascade of the telecom operators exclusion to Intermediaries, FCA are suggesting that the intermediary role requires registration. Our immediate response is to be aware of these potential issues but wait for Treasury to provide their formal position on these matters. We are also considering an escalation to Government ministers (Treasury and DCMS) and have asked Ofcom to become involved as both these issues create a serious threat to premium rate revenues and regulation.