Investigation into Telefonica UK Limited’s (O2’s) compliance with section 135 information requests

Following our investigation, Ofcom has today issued a Confirmation Decision to Telefónica UK Limited (trading as O2) under section 139A of the Communications Act 2003 (‘the Act’) in respect of O2’s contravention of several information requirements contained in two different statutory information requests issued as part of Ofcom’s investigation into O2’s compliance with its metering and billing obligations (the ‘Billing Investigation’).

Ofcom has statutory powers contained in section 135 of the Act to require the provision of information which we consider necessary for the purpose of carrying out our statutory functions, including for the purpose of ascertaining whether a person has contravened or is contravening any regulatory requirement imposed by Ofcom. Importantly, a person required to provide information under section 135 has a statutory duty to provide it to Ofcom in the manner requested and within such reasonable period as we may specify. Compliance with such information requirements is fundamental to Ofcom’s ability to properly carry out our statutory functions in relation to communications matters in line with our principal duty of furthering the interests of citizens and consumers. Failures to comply with such information requirements are therefore taken very seriously by Ofcom.

In O2’s case, we have found several aggravating factors that cumulatively support our finding that its contravention of the relevant information requirements was a serious one and something which we have reflected in the financial penalty. In particular, we have found that:

• the information contraventions related to key areas of the billing error;
• the information contraventions contributed to the Billing Investigation taking longer to complete than would otherwise have been necessary, requiring Ofcom to use additional resource and resulting in additional costs;
• O2’s governance process for responding to our information requests were either not properly followed (at least in full) or were inadequate;
• O2 demonstrated a level of carelessness that is exacerbated in the light of Ofcom’s previous decisions; and
• O2 has a history of contraventions in this area.

In light of the seriousness of O2’s breach, our Confirmation Decision imposes a financial penalty of £150,000 on O2. This penalty was set having had regard to our Penalty Guidelines and includes a 25% discount from the penalty Ofcom would otherwise have imposed. This discount reflects the resource savings Ofcom achieved as a result of O2’s admissions of liability and its agreement to enter into a settlement.

Our Confirmation Decision also requires O2 to review its processes and systems for responding to information requests issued to it by Ofcom in order to assess the extent to which they include the necessary level of oversight needed to ensure the accuracy and completeness of its responses.

A non-confidential version of the Confirmation Decision will be published shortly.

Ofcom requires communications providers (under section 135 of the Communications Act) to provide complete and accurate information upon request, in a designated format, and within a reasonable time period.

On 13 December 2019, Ofcom opened an investigation into O2’s compliance with requests for information under section 135. The purpose for requiring information under section 135 was to investigate O2’s compliance with metering and billing requirements, following information about a billing incident provided to Ofcom from an Approval Body, under the Metering and Billing Direction.

Ofcom’s investigation will examine whether there are reasonable grounds for believing that O2 has failed to comply with its obligations under section 135, namely whether O2’s responses to information requests were complete, accurate and on time.

We are aiming to complete our evidence gathering phase in this investigation by the end of January. We will publish a further update on next steps once that phase is complete.