Press Release

Better Protection for Consumers for Purchasing Telecommunications Services offered by Telecommunications Service Resellers

Consumers will have better protection for purchasing telecommunications services offered by telecommunications service resellers from today (2 February 2007) with the implementation of the Class Licence for Offer of Telecommunications Services under Section 8(1)(aa) of the Telecommunications Ordinance ("the Ordinance").

"These services of the resellers have, from today onwards, been brought within the regulatory purview of the Telecommunications Ordinance. This is for ensuring a level playing field in the market and enhancing consumer protection," a spokesperson of the Office of the Telecommunications Authority (OFTA) said.

Typical examples of telecommunications services offered by resellers are international calling cards and pre-paid SIM cards for mobile phone services.

With the creation of the Class Licence, any person who offers any type of telecommunications services to the general public, even without establishment, operation or maintenance of any telecommunications equipment, will be subject to regulation under the Class Licence and the related statutory provisions under the Ordinance. By adopting a light-handed regulatory approach, all these telecommunications service providers, will automatically become Class Licensees without registration or payment of licence fee. They are regulated under the terms and conditions set out in the Class Licence.

"Protection afforded to consumers under the Class Licence includes the provision of basic information to the customers, maintenance of billing or charging accuracy and resellers' obligations of not engaging in misleading or deceptive practices," the spokesperson explained.

"Under the Class Licence, these service providers have the obligation to provide specific information, such as their names, customer service hotline numbers, business contact numbers and the tariffs for consumers to make informed purchasing decisions. Consumers are advised to look for such information before they purchase the resellers' services," continued the spokesperson.

To enhance public awareness of the above new regulation, OFTA has today issued a leaflet and published a poster for the education of consumers. Guidance information for consumers is also available on OFTA's website.

OFTA has also organised an industry briefing in October last year to assist industry members, in particular resellers of telecommunications services to have a better understanding of the Class Licence. Furthermore, reference may be made to an "Information Note For Persons Who Offer Telecommunications Services (Without Establishment, Operation or Maintenance of Any Telecommunications Equipment) under Section 8(1)(aa) of the Telecommunications Ordinance " published on OFTA's website.

Background

The Class Licence covers services falling within the scope of Section 8(1)(aa) of the Telecommunications Ordinance (Cap.106). The Section provides that save under and in accordance with a licence granted by the Telecommunications Authority (TA), no person shall in Hong Kong "offer in the course of business a telecommunications service". In view of the rapid telecommunications market development and the thriving of various kinds of resale activities, OFTA sees the merit of bringing persons simply offering telecommunications services in the course of business under regulation on a par with licensed operators of telecommunications networks and services in Hong Kong.

After two rounds of public consultation conducted in 2004 and 2006, a TA Statement dated 15 September 2006 was issued in which it was announced that the Class Licence for Offer of Telecommunications Services under Section 8(1)(aa) would be created to put any person offering telecommunications service in the course of business under regulation. The commencement notice for Section 8(1)(aa) of the Telecommunications Ordinance was tabled for vetting by the Legislative Council in October 2006 and the Section is effective starting today (2 February 2007). The TA published today in the Hong Kong Government Gazette the form of the Class Licence to commence its operation together with Section 8(1)(aa).

Office of the Telecommunications Authority
2 February 2007