Consumer Protection in the Communications Industry: Moving to best practice - Issues Paper (July 2008)

2.5. Code compliance monitoring

The Act does not provide any guidance on code compliance monitoring. It does contain a provision allowing ACMA to determine a mandatory industry standard where an industry code has failed (Section 125), but this provision does not set out any mechanism for monitoring code compliance – there is no specific test of ‘failure’.

The lack of clarity and direction regarding code compliance monitoring in telecommunications is a common concern among stakeholders. In their submission to the Productivity Commission Inquiry into the Consumer Protection Framework the TIO noted:

As to a measure of effectiveness, greater clarity about how the Australian Communications and Media Authority (ACMA) will enforce Communications Alliance Consumer Codes would send a powerful signal both to consumers and the industry.[17]

Currently the code compliance monitoring role is shared between the industry association (Communications Alliance) and the regulator (ACMA). There is no independent third party tasked with monitoring.

Communications Alliance (CA) has a Code Administration and Compliance Scheme. This regime produces regular compliance reports. However, ‘The Communications Alliance Compliance Report is available exclusively to financial Communications Alliance members.’ In contrast to many other sectors, no detailed information on compliance is available to the public.

CA note that their compliance methodology depends to some extent on the specific requirements in each code:

Where specifically required by a Code, CA will monitor compliance with Code provisions and the overall effectiveness of the Code in achieving its objectives by, for example:

(a) complaints monitoring;

(b) compliance monitoring;

(c) routine verification of Code compliance by Signatories;

(d) identification of systemic Code issues and breaches.[18]

An example of how this operates in practice is Clause 6.1 of the Emergency Call Services Requirements Code:

Under ACIF Industry Code Signatory arrangements, Signatories to this Industry Code are subject to ACIF G524:2001 Code Administration and Compliance Scheme (the Scheme). Accordingly, all signatories who are bound by this Industry Code are also bound by the Scheme.[19]

The result is that the Code Administration and Compliance Scheme only applies to signatories. This is a somewhat unusual and confusing arrangement. It can be very difficult to determine which organisation has signed a code, and the overall level of signing is extremely low. There are close to 2000 participants in the telecommunications sector. A typical code has only 3-4 signatories. Some have none.

CA states that it conducts some additional monitoring regarding overall code compliance, including compliance by non-signatories. For example, CA receives and reviews the TIO complaints statistics.

As mentioned earlier, compliance monitoring responsibility is shared with the regulator.

ACMA has published the ‘Australian Communications and Media Authority’s (ACMA) approach to code compliance’.[20] This is a five-category compliance approach with a graduated use of regulatory measures:

Step	Triggers	Category	Action
1	Consumer complaints made directly to ACMA Advice or referral from the TIO, another regulatory or industry body or a provider Issue raised in public debate	Preliminary Enquiry	Alert provider that breach may have occurred Provider encouraged to address issue Assess whether issue requires escalation
2	Systemic code breach is probable and provider is not adequately addressing the matter Formal investigation is required to ascertain if provider is complying No response or inadequate response from provider to ACMA’s preliminary enquiry	Investigation	ACMA views that systemic code breach is probable Provider formally invited to respond to issues
3	Provider has not taken any remedial action Provider’s remedial action insufficient to rectify the problem No response or inadequate response from provider to ACMA’s investigation	Systemic Breach Finding	Systemic code breach has occurred Provider formally requested to propose rectification strategy ACMA may make public comment
4	Provider has not followed through on strategy committed to earlier Provider has failed to amend systemic non-compliant practices	Formal Warning	Formal warning issued to provider to comply with the code under section 122 ACMA may make public comment
5	Matter escalated from ACMA formal warning	Formal Direction	Formal direction issued to provider to comply with the code under section 121 ACMA may make public comment

ACMA states that it ‘retains the discretion to decide where an individual matter falls within the approach and may decide it is appropriate to consider urgent matters at higher categories, on a case by case basis’.[21] In practice ACMA (including its predecessor the Australian Communications Authority) has made only three directions under Section 121 of the Act regarding code compliance during the ten years that the Section has been operational.

Overall, compliance monitoring appears fragmented. Significant monitoring is in place for the small handful of signatories to specific codes. Higher level monitoring is in place for all codes, but this has resulted in only minimal enforcement action. The absence of regular reporting and published statistics is a major weakness.

[17] Telecommunications Industry Ombudsman, Submission to the Review of Australia’s Consumer Policy Framework Issues Paper, 3 July 2007, page 2, <http://www.pc.gov.au/__data/assets/pdf_file/0004/65794/sub097.pdf>.

[18] Communications Alliance, ACIF G514:2003 ACIF Code Administration and Compliance Scheme, 2003, clause 2.7.1, <http://www.commsalliance.com.au/__data/page/3420/G514_2003.pdf>.

[19] Communications Alliance, ACIF C536:2003 Emergency Call Services Requirements, 2003, <http://www.commsalliance.com.au/__data/page/3223/C536_2003.pdf>.

[20] Australian Communications and Media Authority, ACMA approach to telecommunications code compliance, 11 March 2008, <http://www.acma.gov.au/WEB/STANDARD/pc=PC_2526>.

[21] Australian Communications and Media Authority, ACMA approach to telecommunications code compliance, 11 March 2008, <http://www.acma.gov.au/WEB/STANDARD/pc=PC_2526>.





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