Watchdog branch to tackle unfair phone-industry practices

PUBLISHED : Tuesday, 19 June, 2001, 12:00am
UPDATED : Tuesday, 19 June, 2001, 12:00am

Mobile phone and IDD networks are to be scrutinised by a new branch of the industry watchdog set up to stamp out unfair trade practices that limit consumer choice.

The Office of the Telecommunications Authority (Ofta) has set up a competition affairs branch to police the industry and protect users' interests. This follows a spate of complaints about the industry in the past 18 months, and a catalogue of acts by phone companies to mislead or disadvantage customers.

An Ofta spokeswoman said that under revamped laws the whole industry was obliged to comply with fair competition rules - not just firms that had the rules written into their licence agreements. She said that previously the rules mainly applied to fixed-line phone companies.

'There's a need to strengthen Ofta's resources to handle the promotion of fair competition in the market, and the enforcement of these provisions,' she said. 'In the past, the competition provisions were only incorporated in certain licences, but we think they should apply to the whole telecommunications sector.'

The spokeswoman said the new branch would monitor the market and watch for signs of anti-competitive behaviour. Staff would also be on the lookout for misleading or deceptive behaviour by telecommunications operators and would investigate complaints lodged from outside.

A Consumer Council spokesman said yesterday: 'If they're going to be more pro-active and educate the industry about fair trade and inform the public, of course we're happy about that.'

In January last year, Ofta found that the heads of all six of Hong Kong's mobile phone companies had colluded to increase monthly rates on the same day. There was no written evidence of a deal to raise prices, but enough pieces of the jigsaw to prove the companies had at least an understanding of what each other was planning.

Since then, IDD company One.Tel - now in liquidation - has twice been admonished by Ofta for deceiving customers over call rates. In October last year, it claimed that no other company offered cheaper calls to the mainland when five of its rivals had lower rates. The company had already been in trouble for promising the lowest price in town for overseas calls, but excluded other networks' specials and giveaways from its offer.

Fixed-line rivals New T & T and Pacific Century CyberWorks HKT have for months been publicly accusing each other of trickery in their battle for residential customers.

The Consumer Council last year reported a surge in the number of complaints about phone and Internet services, with more than 2,000 people protesting over poor service or unexpectedly high bills in just six months.

Under the Telecommunications Ordinance, offending companies can be ordered to rectify any wrongdoings. They can also be fined up to $1 million and have their licence suspended or revoked.