More companies will need permission to operate premium rate services, regulator says

The premium rate service telephone industry regulator said that some providers of premium rate services may now have to obtain "prior permission" to operate under new rules that are set to come into force imminently.

Rules governing the content and promotion of premium rate services are set out in PhonepayPlus' Code of Practice (Code).

Currently under the terms of the Code PhonepayPlus can require some premium rate services to obtain prior permission to operate and "identify conditions" that the services must satisfy before that permission is granted. Some services, including those involved in live chat, gambling and counselling, must obtain prior permission because they "pose a greater risk of harm to users because of their content", a statement on the PhonepayPlus website said.

The latest edition of the Code, due to come into force on 1 September, "has in effect shifted the responsibility for compliance with specific rules and outcomes relating to the operation and promotion of premium rate services," PhonepayPlus said. This means that "any registered provider who is currently involved in the delivery-chain for a service which requires prior permission" could have to first seek PhonepayPlus permission before it can legally operate, the regulator said.

Currently prior permission needs only to be obtained by a relevant service provider if it "contracts with or enters into arrangements with a network operator for use of the network operator’s facilities in the provision of the relevant premium rate service".

PhonepayPlus published a list of the functions that providers of premium rate telephone services may be involved with that would require prior permission to be obtained under the terms of the new rules. Among the organisations that will need to obtain prior permission are companies that own or operate recording equipment used in live services and companies that employ professionals to give professional advice via premium rate services, the PhonepayPlus notice said.

Applications by companies involved in operating premium rate service where prior permission is required "must be made on their behalf by the provider in the delivery-chain who is directly contracted to, or has arrangements with, a Network operator," the notice said.

"The persons who are required to seek and hold prior permission will change from 1 September 2011, so that the registered provider or providers who has/have the most direct responsibility for any of the key conditions attached to a prior permission regime will be required to have prior permission in respect of the services they run which fall into the relevant category," the PhonepayPlus notice (6-page / 76KB PDF) said.

"It has become necessary for the focus of the current prior permission regime to change, so as to be aligned with the focus of the Code. The change is also necessary from an enforcement perspective, so that in the event of a breach of a key condition of permission, only the relevant responsible provider will be held liable, and not a provider who has no control over the fulfilment of the condition (although such providers may have separate due diligence and risk assessment obligations under the Code)," the notice said.

Permission rights must be obtained within six months of 1 September in order for services to continue to operate legally, PhonepayPlus said.