Regulatory Outlook

Telecoms | UK Regulatory Outlook July 2024

Published on 25th Jul 2024

Telecoms Security Act preparation | Changes to mid-contract price rises | Ofcom proposes measures on global titles

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Summer call to action

Telecoms Security Act preparation: The first implementation date for Tier 2 Providers (those with relevant revenue of £50million or more) is fast approaching (31 March 2025).

Providers should:

  • Start conducting due diligence exercises to understand more about their third party suppliers: the contracts they have in place with suppliers; look at where geographically suppliers are located, and whether their core operations are located outside of the UK; and what the realistic fallbacks are in the event of a security incident (for example, break clauses, indemnities, step-in rights, replacement suppliers)?
  • Determine their dependency on a particular supplier. If the replacement of equipment from a supplier will be difficult or expensive to replace, providers may be creating a long-term reliance on the supplier to ensure their own network stays secure. Providers should ensure that the amount of equipment procured from an individual supplier is kept to an acceptable level in order to minimise the associated risks of over-dependence.

Suppliers of telecoms providers caught by the Act should:

  • Consider how the regulations actually affect them and their customers (that is, the regulated providers). If they have come to the conclusion that they do not directly affect them, the regulations may still be impacting their customers, so they will need to have an idea of the relevant requirements under the law.
  • Begin conversations and gain an understanding of their customers' expectations and plans in relation to compliance with the law. Once a customer approach has been set out, suppliers will be in a better position to conduct an impact analysis, including the finances involved in compliance.
  • Provide support to their account managers on how to have the right conversations with customers and provide internal training on the operational measures that will have to be put in place.

Changes to mid-contract price rises

On 19 July, Ofcom published a statement detailing the outcome of its consultation on mid-contract price rises. In it, Ofcom confirms that, starting from 17 January 2025, where a customer is a consumer or small business (with some exceptions) any price rise written into their contract will need to be set out in pounds and pence, prominently and transparently at the point of sale.

The new rules are a departure from the current position which enables communications providers to increase their charges based on the retail prices index (RPI)/consumer prices index (CPI) and fixed percentages. This resulted in many communications providers applying annual increases of CPI plus 3.9%, with customers being subject to price rises that Ofcom deemed unacceptable.

If communications providers do not give customers the correct information and still apply a price increase then those customers will have a right to end their contracts without payment of any early termination fees. Consequently, it is important that communications providers start to think about how their contracts will need to be updated well in advance of the January deadline.

Ofcom proposes measures on global titles

This month Ofcom launched a consultation on the implementation of a number of new measures aimed at tackling the misuse of Global Titles. Global Titles "enable access to the global mobile signalling network and in the wrong hands they can be misused to try and intercept messages and calls, disrupt the operation of networks and track the location of users of other networks".

The measures include:

  • banning leasing of Global Titles to third parties by operators that hold UK mobile numbers;
  • banning the creation of Global Titles from sub-allocated numbers by third parties;
  • strengthening rules to prohibit the misuse of Global Titles by operators that hold UK mobile numbers; and
  • strengthening rules to prohibit the creation of Global Titles from numbers not allocated for use.

Ofcom is consulting on these proposals until 15 October 2024 and, if implemented, the bans would come into force on 1 January 2026. 

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* This article is current as of the date of its publication and does not necessarily reflect the present state of the law or relevant regulation.

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