Tackling mis-selling of fixed-line telecommunications services remains an important Ofcom priority.
Mis-selling works against the interests of consumers, both directly through harm and distress as well as undermining confidence in the development of competition and in the industry as a whole.
Ofcom introduced new rules to protect consumers from harm caused by mis-selling on 26 May 2005 in the form of an amended General Condition 14 (‘GC14’). General Conditions are rules imposed by Ofcom on specific categories of Communications Provider (‘CPs’) in accordance with the Communications Act 2003 (‘the Act’). The amended GC14 required all CPs supplying fixed-line telecommunications services to establish, and comply with, sales and marketing codes of practice, which are consistent with Ofcom published guidelines annexed to the amended GC14.
Ofcom has since pursued an active enforcement programme through an industry-wide investigation with the aim of securing compliance with the rules. We have been monitoring allegations of mis-selling in order to identify companies who are engaged in mis-selling, so that we can take action to protect the interests of consumers.
Despite these new rules, and our active enforcement programme, we continue to see high levels of fixed-line telecommunications mis-selling complaints. We have examined the existing regulations, and our experience of enforcing against these as well as the evidence on complaints and changes in the industry. In the light of this analysis, we have not been persuaded that sufficient progress has been made in reducing levels of fixed-line telecommunications mis-selling.
We are therefore proposing changes to strengthen the regulations to address this ongoing consumer harm.