Consumer Protection in the Communications Industry: Moving to best practice - Issues Paper (July 2008)

2.3. Code content

Section 113 of the Act provides a list of ‘examples of matters that may be dealt with by industry codes and industry standards’. Although the list is meant to act as a non-definitive set of examples, it appears to have been given considerable weight by industry. As a result, consumer issues that do not appear on the list are unlikely to appear in a code.

Once a topic is selected for a code, there is very little direction in the Act regarding the consumer protection content of the code.

However, there is some guidance regarding code process requirements. ACMA provides the following list of criteria for the registration of a code:

  • Consistent with the objects of the Telecommunications Act 1997;
  • Consistent with the provisions of the Act and with other legislation;
  • Consistent with codes already registered;
  • Contains a comprehensive set of rules which are directed at achieving, and measuring the achievement of, the code objectives;
  • Rules are expressed predominantly in mandatory terms such as ‘must’ instead of ‘should’ or ‘may’;
  • Relates to a telecommunications activity, as defined in the Act;
  • Does not prescribe pecuniary penalties for breaches of code rules;
  • Does not include clauses that indemnify one party against loss suffered as a result of a breach of a code;
  • If it references other documents, these clauses are appropriately drafted and with relevant documents clearly referenced or included;
  • If it references bilateral agreements, these clauses are appropriately drafted;
  • If it references agency agreements, these clauses are appropriately drafted;
  • Contains appropriate code administration, including provisions for complaint handling, sanctions, monitoring and review;
  • Specifies the complaint-handling body, what functions and powers will be undertaken, and which code provisions they relate to; and
  • Addresses the concerns of the groups and individuals consulted during the development of the code.

It is important to note that none of these criteria address consumer protection issues or requires a code to meet specific consumer protection standards. This is a significant contrast with co-regulation in other sectors.

Codes are informally divided between consumer codes and operational codes. See for example the TIO’s description of codes:

There are two types of codes: operational codes cover operational matters such as the way that industry players deal with processes between themselves, and consumer codes focus on practices between telecommunications providers and their customers.[10]

It is important to note here that the distinction between operational codes and consumer codes is relatively informal. In most effective systems of co-regulation a more formal distinction is made between consumer protection instruments (that must usually meet certain content requirements) and purely operational instruments. There is room in the telecommunications sector to formalise arrangements so that a more rigorous and specific consumer protection framework applies to relevant codes, and operational matters are left to industry self regulation within generic consumer and competition safeguards. This requires a thorough analysis of Codes that may appear operational in nature, but contain important consumer safeguards (e.g. the CND[11], IPND[12], and Emergency Call Services[13] Codes).

There may also be a need in the Australian telecommunications sector to review the reactive process for determining the subject mater of codes. For example, consideration could be given to providing the regulator with a Market Inquiries power, to identify matters that should be the subject of stronger consumer protection, rather than waiting for industry to develop codes on their own.[14]

Formal market inquiry provisions could help to formalise and codify activities which already exist at an informal level in the telecommunications sector – and give consumer an open and transparent avenue for seeking the exercise of these powers.

[10] <>

[11] Communications Alliance, ACIF C522:2007 Calling Number Display, 2007, <>.

[12] Communications Alliance, ACIF C536:2003 Emergency Call Services Requirements, 2003, <>.

[13] Communications Alliance, ACIF C555:2008 Integrated Public Number Database (IPND), 2008, <>.

[14] CHOICE, Supplementary Submission to the Productivity Commission Review of Consumer Policy Framework, March 2008, pages 4–6, <>.