LCQ16: Billing of telecommunications services
Following is a question by the Hon Chan Chi-chuen and a written reply by the Secretary for Commerce and Economic Development, Mr Gregory So, in the Legislative Council today (November 30):
I have recently received complaints from a number of members of the public that some telecommunications service operators overcharged them, and even charged them for telecommunications services that they did not subscribe for, causing them to suffer financial losses. In this connection, will the Government inform this Council:
(1) whether it knows the respective numbers of complaints, received in the past 12 months by the Office of the Communications Authority and the Consumer Council, about overcharging by telecommunications service operators; if so, of a breakdown by type of telecommunications services (e.g. fixed-line phones, mobile phones, external telecommunications and broadband Internet access) involved in the complaints;
(2) whether it knows, among the cases in (1), the number of those in which the complainants were offered a reduction in the relevant fees by the telecommunications service operators concerned, and whether there were any telecommunications service operators prosecuted for overcharging; if there were, of the number of such cases; and
(3) apart from continuing to implement the Code of Practice in Relation to Billing Information and Payment Collection for Telecommunications Services and the Industry Code of Practice for Telecommunications Service Contracts, whether the authorities will adopt new regulatory measures to enhance the protection for consumers' rights and interests; if they will, of the details; if not, the reasons for that?
In general, upon receiving complaints in relation to the billing of telecommunications services, the Office of the Communications Authority (OFCA) will, with the consent of the complainants, refer such complaints to the operators concerned for follow-up with the complainants direct. Where there is evidence indicating that an operator may have breached the ordinances applicable to telecommunications services (such as the Telecommunications Ordinance (TO) and the Trade Descriptions Ordinance (TDO)) or relevant licence conditions, the Communications Authority (CA) will conduct an investigation in accordance with the statutory power conferred by the relevant ordinances. For cases with sufficient evidence to substantiate contravention with the relevant ordinances or licence conditions, the CA will penalise or prosecute operators accordingly.
My replies to the questions raised by Hon Chan Chi-chuen are as follows:
(1) The table below sets out the distribution of the complaint figures on billing disputes in relation to telecommunications services (Note) received by the OFCA in 2016. It also sets out the distribution of figures of the previous two years for reference:
The table below sets out the distribution of the complaint figures on billing disputes in relation to telecommunications services (Note) received by the Consumer Council (CC) over the same period:
Note: The number of complaints on billing disputes covers all complaints in relation to billing issues, including overcharging and other billing disputes such as customers not clear about the details of their tariff plans, or customers' inadvertent use of services with additional charges (such as data roaming services), etc. The figures in the above reply are not limited to complaints about overcharging. Both the OFCA and the CC have not further categorised complaints on billing disputes by the content of the disputes.
(2) Out of the 280 complaint cases received by the OFCA in 2016 (up to October 31), there were 240 cases referred, with the consent of the complainants, by the OFCA to the operators for assistance in mediating, among which 161 cases (67 per cent) have been settled. Over the same period, the CC referred 1 464 cases to the operators for assistance in mediating, among which 1 279 cases (87 per cent) have been settled. The OFCA and the CC have requested the operators to properly handle the remaining unsettled cases that have been referred to them. Among the complaint cases involved, the OFCA and the CC have not kept record on the number of cases in which the complainants have been offered a reduction in fees by the operators.
In handling the above complaint cases, the OFCA has not found any substantiated cases of breaches of the existing legislation or licensing conditions by the operators which justify the imposition of penalties or institution of prosecution.
(3) The CA has been closely monitoring the operation of the market and is committed to ensuring that the interests of consumers in using telecommunications services are reasonably protected. It also regulates telecommunications service operators in accordance with the powers conferred by the relevant ordinances.
The licences issued by the CA to the operators require licensees to ensure the accuracy and reliability of their metering equipment and billing system related to service usage. In response to consumer complaints over the billing of telecommunications services and various consumer issues, the OFCA has implemented various measures to further enhance the protection of the interests of consumers. Apart from the Code of Practice in Relation to Billing Information and Payment Collection for Telecommunications Services and the Industry Code of Practice for Telecommunications Service Contracts mentioned in the question, the relevant measures also include:
Implementation of the Customer Complaint Settlement Scheme
To help resolve billing disputes in deadlock between consumers and their telecommunications operators, the telecommunications industry has, with the facilitation of the OFCA, set up a voluntary Customer Complaint Settlement Scheme (CCSS). The CCSS helps resolve, by means of mediation, billing disputes between the concerned parties without the involvement of formal legal procedures.
Since the commencement of the CCSS on November 1, 2012, a total of 637 eligible applications were received up to October 31, 2016. Among these cases, 294 cases were settled through further negotiation between the consumers and their telecommunications operators before referral by the OFCA to the mediation service centre (CCSS Centre); 335 cases were successfully settled after referral by the OFCA to the CCSS Centre for processing. Overall speaking, the number of settled cases amounted to 99 per cent of the total eligible applications. The result was satisfactory.
Implementation of "mobile bill shock" preventive measures
The growing popularity of smartphones and advanced mobile devices has driven the growth of and demand for mobile data services. However, at the same time, it has also led to the rise in the number of consumer complaints relating to billing disputes of mobile broadband services. Many of these complaints involve "mobile bill shock", which refers to the shock consumers experience upon receiving unexpectedly high mobile bill charges. "Mobile bill shock" is mainly caused by consumers' unintentional or inadvertent usage of mobile data services, locally or while roaming overseas.
To address this problem, the OFCA has promulgated the measures implemented by individual operators to prevent "mobile bill shock" since August 2010, including allowing users to opt out individual services, setting a charge ceiling, setting a usage cap for all kinds of usage-based mobile services, and alerting users through short messages when their pre-determined usage threshold is reached, or when their roaming data usage is triggered. The OFCA would also update the relevant information regularly.
The OFCA is also committed to enhancing public understanding on the way to prevent "mobile bill shock" through conducting various public education activities, including organising public and community talks, roving exhibitions, roving drama in schools, showing relevant publicity videos on some public transport, and publishing comic strips and advertorials on newspapers and magazines, etc. Recently, the OFCA has set up a consumer education webpage on social media to further promote relevant and other consumer education messages, so as to facilitate members of the public to choose and use communications services wisely.
Combat against unfair trade practices according to the TDO
Since July 19, 2013, the TDO prohibits traders from deploying specified unfair trade practices against consumers, including false trade descriptions of services, misleading omissions, aggressive commercial practices, bait advertising, bait-and-switch and wrongly accepting payment. Concurrent jurisdiction is conferred on the CA to enforce the relevant provisions of the TDO in relation to the commercial practices of licensees under the TO and the Broadcasting Ordinance that are directly connected with the provision of telecommunications and broadcasting services under the latter two ordinances.
If the CA receives complaints against operators concerning unfair trade practices, it will examine the information provided by complainants with a view to assessing whether it should undertake further actions, which include conducting investigations, collecting relevant evidence and taking appropriate enforcement actions. The maximum penalty of the relevant offence is a fine of $500,000 and an imprisonment of five years, which should have significant deterrent effect on all telecommunications service licensees.
The OFCA will continue to closely monitor the implementation and effectiveness of the above measures, and will improve the above measures to further protect the rights and interests of consumers as necessary having regard to the operators' experience and consumers' views. The CC will continue to promote consumer education to assist consumers in making informed consumer choices. The CC will also work with operators and regulators and propose suggestions for improvement from time to time.
Ends/Wednesday, November 30, 2016