Ofcom Regulates VoIP

Ofcom has amended the General Conditions - regulations which apply to all telecommunications providers, so that certain conditions will now apply to VoIP providers, and have published a new code of practice that VoIP providers must comply with. The changes are designed to ensure that consumers have access to key information about the capabilities of the services provided.

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VoIP services are having an increasing impact on the UK communications sector. The range of services now available has generated significant benefits to consumers as providers offer lower prices, more choice and new services.

In 2004 Ofcom published a consultation paper entitled "New Voice Services: A consultation and interim guidance". This paper set out Ofcom’s proposals with regard to a future regulatory framework for VoIP services in order to ensure consumer’s interests were maintained. In the years leading up to the 2004 consultation, VoIP was a relatively infant market and did not have the capabilities and wide range of services and competitors that it does today.

In 2006 Ofcom published a second consultation paper entitled Regulation of VoIP Services: Statement and further consultation, which took into account both the responses received during the earlier 2004 consultation paper and the continuing developments in VoIP since 2004. The 2006 consultation paper set out three objectives which Ofcom would pursue in relation to VoIP to further the interests of citizens and consumers. These were:

• Enabling innovation in a technological neutral way;

• Ensuring consumers are well informed; and

• Ensuring maximum availability of emergency services access.

In order to address these objectives, Ofcom made the following proposals in its 2006 consultation paper:

• To require providers of Public Electronic Communication Services to comply with a code of practice on the provision of customer information; and

• To modify the definition of a "Publicly Available Telephone Service" in Ofcom’s General Conditions so that only services available to the public for originating and receiving national and international calls and access to emergency services through a normal telephone number have the right to number portability.

In light of the responses to the consultation paper, and in order to implement the above proposals, Ofcom has made modifications to the General Conditions. Ofcom has modified General Conditions 14 and 18 so that providers of Public Electronic Communication Services, to the extent that the services comprise conveyance of speech, music and sounds (i.e. this will include VoIP), must now comply with relevant parts of the General Conditions and also a new Code of Practice entitled the "Code on the provision by Service Providers of consumer information to Domestic and Small Business Customers for the provision of Services".

A copy of the new code can be seen at Annex 4 of General Condition 14, which can be found here.

As a result of the changes, VoIP providers must publish and make available certain information, including their contact details, services, and full details of their tariffs.

A number of respondents to Ofcom’s 2006 consultation expressed strong views about whether the proposed changes would be sufficient to ensure an adequately high level of access to emergency services for VoIP user. Despite this, the Code does not require VoIP providers to provide access to emergency services. However, the changes to the General Conditions and the Code wording will require VoIP providers to:

• inform consumers, either using a physical label or an on screen message, whether or not the VoIP service offered has the capability to call emergency services; and

• provide point of signature acknowledgement that access to emergency services is not possible in the case of a power cut.

Ofcom has also responded by modifying the definition of "Publicly Available Telephone Service" for the purposes of General Condition 18 so that number portability will not be available where the VoIP provider does not provide access to emergency services. This means that, unless a VoIP provider offers access to emergency services, it will not be able to offer customers the same number that they previously used with another service provider.

These new developments mark an increase in Ofcom’s interest in the VoIP market. Ofcom has announced that it will issue a further consultation on whether, and if so how, certain VoIP services should be required to offer emergency services access. As well as their interest in the important issue of access to emergency services, Ofcom is also investigating other issues such as naked DSL, net neutrality and the regulation of nomadic services. With both the current and future increases in regulation, VoIP providers will need to ensure that they are well aware of what the regulations mean to them and how they will adapt to ensure compliance while continuing to grow and develop in the innovative VoIP market.

This article was written for Law-Now, CMS Cameron McKenna's free online information service. To register for Law-Now, please go to www.law-now.com/law-now/mondaq

The original publication date for this article was 01/06/2007.