Wednesday, 5 October 2022
Communications Regulation Bill 2022: Second Stage
I move: "That the Bill be now read a Second Time."
That a lot has changed since 2002 will not be a controversial contention. This proposition is arguably more accurate for the electronic communications sector than for any other. In 2002, there were fewer than 3 million mobile subscriptions in the State but, by 2021, that number had ballooned by over 4 million, bringing the total number of mobile subscriptions to over 7.3 million. What mobile phones are capable of has drastically changed. In 2002, commercial deployment of 3G was still a year away. Today, we have commercial deployment of 5G in increasing areas across the State, providing speeds of which consumers in 2002 could only dream.
The change in fixed connectivity has been stark. Commercial deployment of broadband commenced in Ireland in 2003. Today, there are more than 1.8 million broadband subscriptions in the State, a growing number of which are fibre-to-the-premises connections. The number of broadband subscriptions is expected to continue to grow, through increased commercial deployment by operators and the continued roll-out of the national broadband plan. The forthcoming digital connectivity strategy for Ireland will set out the scale of the ambition for connectivity through the next decade.
This growth in connectivity has also revolutionised the way we live our lives. In 2002, social media meant little to most people and although it was not uncommon to spend hours browsing the aisles of a local video shop, it was much less common to purchase anything online. Today, we can connect with friends and family around the world, choose which new box set to watch and do our weekly food shop, all at the tap of a screen.
However, while it is clear that there have been considerable changes in electronic communications and wider society in the past 20 years, the powers afforded to ComReg to regulate the sector have not kept up to date with these changes. The first aim of the Bill is to address this issue. The Bill represents the biggest update to the regulation of the electronic communication sector since the establishment of ComReg in 2002.
The legislation will provide ComReg with the tools it needs to effectively regulate the sector today and will bring its powers further in line with comparable regulators in the State and elsewhere in Europe. ComReg will be empowered to find non-compliance, impose sanctions of up to €5 million or 10% of annual turnover, require operators to pay refunds and compensation, and withdraw general authorisation and rights of use for spectrum and numbering resources. These penalties will ensure that the sanctions available to ComReg are effective, proportionate and dissuasive in a sector of the scale of electronic communications, which is worth €3.5 billion every year to the economy. A range of new settlement options will also be available, including a new section 44 resolution agreement, the acceptance of binding commitments and the entering into of a settlement agreement. A new urgent interim measure procedure will also be provided to ensure that tools are available, in advance of the conclusion of any adjudication, to address instances of non-compliance that risk public safety, public security, public health or the creation of economic or operational problems for other providers or users.
In order to ensure that this new regime complies with constitutional requirements in light of the Supreme Court judgment in the Zalewski case, comprehensive procedural safeguards have been included in the Bill and are similar to those provided for in the Competition (Amendment) Act 2022. These were developed in close co-operation with the Office of the Attorney General.
Adjudications on suspected breaches will be carried out by adjudicators, who can be internal ComReg staff or external experts nominated by ComReg and appointed by the Minister. These adjudicators will be independent in the performance of their functions and I will be publishing regulations to give further effect to this requirement in the coming months. Decisions of adjudicators will be subject to confirmation by the High Court and subject to appeals to that body. The Bill also provides for the carrying out of oral hearings, rules for admission of evidence and the taking of oaths and affirmations.
The need for a review of the regulatory framework for the electronic communications sector in light of the speed of change in the past decade was recognised by the EU in the European electronic communications code. Providing for the enforcement of this directive and designating ComReg as the body responsible for its enforcement is the second aim of the Bill. The European electronic communications code consolidated much of the previous regulatory framework and made it fit for the digital age. Transposition of the directive will be given effect to in Ireland through the Bill and the European Union (Electronic Communications Code) Regulations 2022 that were signed on 6 September but will not commence until the enactment of the Bill.
Although it is not possible to discuss the entirety of the code regulations, I wish to highlight a particular aspect of them, namely, the introduction of a universal services obligation for broadband. This is an instrument that could be used in future to ensure that as gigabit broadband services continue to be deployed by commercial operators, small numbers of premises within these commercial areas are not left behind. The expectation is, however, that as commercial operators upgrade their existing infrastructure or build new gigabit broadband infrastructure, they will design their deployments to avoid leaving small pockets of households and businesses stranded where end users cannot connect to that network. Any future universal services obligation will not seek to compensate inefficient network designs which may be driven by a very short-term commercial focus to the detriment of end users in that area and potentially further widening the digital divide.
All of the obligations created by the regulations will be civilly enforceable under the new civil enforcement regime. Particular obligations will also be subject to criminal enforcement, with a further select few subject to a maximum criminal penalty of €10 million if prosecuted on indictment. The Bill specifically provides for this higher level of maximum criminal penalty for these particular offences.
The roll-out of new technologies and networks is not without risk. When criminals attacked our health service we saw the devastation that can be caused when those who wish to do us harm attack critical infrastructure. Disruption to our electronic communications infrastructure could be equally damaging, with the potential to have cascading effects throughout the rest of critical infrastructure, making the protection of these networks of paramount importance to the Government.
Under this Bill, our next generation networks will be built upon a solid foundation that is resilient to future threats by ensuring operators manage the risks posed to their networks and services as well as reporting significant security incidents.
The Government held a consultation on a detailed set of electronic communications security measures based upon leading standards, and this Bill provides a mechanism to put these measures on a statutory basis. These measures, together with additional supervisory and enforcement powers for the Commission for Communications Regulation, ComReg, will put Ireland's electronic communications infrastructure on a secure foundation to make Ireland an attractive place to live and do business.
While there has been such a dramatic improvement in the prevalence and speed of electronic communications services in the past 20 years, some issues continue to affect the sector negatively. Of primary concern among these is consumer dissatisfaction with the customer service they receive from their providers. Whether this stems from unacceptable call answering times, overcharging, issues with switching providers and porting numbers, or a myriad of other frequently reported issues, this issue is one which has been discussed numerous times both in this House and has been covered across the media. Complaints to ComReg were down in the second quarter of 2022. However, they are coming down from a high base over the course of 2021. Reports of consumer dissatisfaction with companies across all sectors show that electronic communications providers repeatedly and consistently do not perform well when compared with service or goods providers in other sectors. Addressing this issue is the fourth aim of this Bill. The Bill will provide consumers with a suite of new protections when they are interacting with this sector. These provisions have been drafted in close consultation with ComReg and address the number of consumer service complaints that have arisen in recent years.
The Bill will provide for an enhanced alternative dispute resolution process for consumers, managed by ComReg, which retains the requirement for operators to have a code of practice for complaint handling. ComReg will be empowered to require operators to publish information on the quality of service they provide to their customers and to publish a customer charter that will clearly set out the standards consumers can expect their services to provide. If the service provided to customers is not adequate, ComReg will be permitted to set minimum quality of service standards that operators must guarantee to their consumers in a range of areas, including in respect of call answering times, notification of outages, time taken to review billing queries and time taken for initial connection to the network. Failure to comply with these standards will constitute a breach for the purpose of the Bill but will also be capable of giving rise to the payment of compensation to a consumer, pursuant to the new end user compensation regime also to be established by the Bill.
The fifth and final aim of the Bill is the updating of the Communications Regulation Act 2002 to align that Act with the European electronic communications code and make necessary amendments to ComReg's current functions and powers to improve their functionality and complement the new proposed enforcement regime. These will include, inter alia, a broadened information-gathering power, ability to reuse already gathered information, ability to better assist with policymaking, and improvements to the notification, privilege and overcharging provisions.
I would like to take this opportunity to inform my colleagues here today that it is my intention to bring a small number of amendments to this Bill on Committee Stage. In the first instance, I propose to bring forward an amendment to section 43 of the Communications Regulation Act 2002 to clarify beyond doubt ComReg's ability to prosecute summarily all offences capable of summary prosecution, including offences that can also be prosecuted on indictment, sometimes referred to as "each way" offences.
Second, I will be bringing forth an amendment to provide for an assessment of the risk profile of providers of electronic communications and to make orders banning or restricting high-risk vendors from critical or sensitive parts of the networks. There have been extensive cross-government discussions on this issue and the amendment will provide transparency for the process under which vendors will be assessed. Ireland's proposed approach is aligned with that being taken throughout the EU as well as by the UK.
Third, I will be bringing forth two amendments to the Digital Hub Development Act 2003. The purpose of the two amendments is, first, to confer a function on the board to dispose of its land and property assets on foot of a directive by the Minister pursuant to the 2003 Act and, second, to reduce the membership of the agency from 14 to eight and the number required for a quorum from six to four. The sale of the Digital Hub Development Agency, DHDA, land is one of the most significant transactions required to dissolve the agency and is a step that must be completed before the dissolution can be completed. This amendment will enable progress to be made in terms of dissolving the DHDA and ultimately facilitating the redevelopment of the site for affordable housing and mixed uses. The second amendment allows for a continued functioning board throughout the dissolution process and mitigates against the risk of the board becoming inquorate during the wind-down and dissolution period.
There may also be the possibility that the Government will bring forward a short amendment to the Postal and Telecommunications Services Act 1983 to provide for payments to be made to or via An Post, particularly in the context of the support to postmasters. This amendment is the subject of ongoing engagement with the Attorney General's office.
I would also like to take this opportunity to acknowledge and thank the members of the Oireachtas Joint Committee on Transport and Communications for their engagement during the pre-legislative scrutiny of the Bill and their report. I also thank ComReg, which engaged extensively with my officials through all stages of the development of this Bill.
I now turn to the main provisions of the Bill. This Bill contains eight Parts. Part 1 contains standard provisions dealing with the Title, collective citation and commencement of the Bill. It also provides for definitions of terms used in the Bill.
Part 2 transposes the security provisions of the code, articles 40 and 41. It places general obligations on providers of electronic communications networks and services to take appropriate and proportionate security measures to manage the risks posed to their networks and services. There are also obligations on providers to report significant security incidents to ComReg. The Bill provides a mechanism by which regulations can be made specifying the types of security measures that providers shall take, thus providing a statutory basis for the electronic communications security measures, which are a detailed set of technical security measures produced by the National Cyber Security Centre in consultation with ComReg and industry to secure the State's electronic communications infrastructure. The security provisions provide additional supervisory and enforcement powers to ComReg to ensure compliance with the security provisions.
Part 3 provides for measures to assist consumers and other end users. This part permits ComReg to specify minimum quality-of-service standards to be met by service providers. Once minimum standards have been set, failure to meet these minimum standards will constitute a regulatory breach but will also be capable of giving rise to the payment of compensation to a consumer through a new end user compensation scheme. ComReg may also require providers to publish information on the quality of service they provide and to publish a customer charter. The aim of this customer charter is to provide consumers with one easily accessible and comparable place to get information as to the quality of service provided by an operator.
Part 4 sets out procedures for the resolution of complaints and disputes. It provides for an enhanced alternative dispute resolution procedure. It also carries forward the existing complaints handling codes of practice from the European Communities (Electronic Communications Networks and Services) (Universal Service and Users' Rights) Regulations 2011, Sl 337.
Part 5 provides that ComReg may take urgent interim measures to remedy a situation where it has evidence of a breach of the conditions of the general authorisation, rights of use or of the specific obligations "which represents an immediate and serious threat to public safety, public security or public health or risks creating serious economic or operational problems for other providers or users of electronic communications networks or services or other users of radio spectrum".
Part 6 sets out a new civil sanctioning regime for ComReg that will include the ability to find non-compliance and impose a range of penalties, including administrative financial sanctions up to a maximum of €5 million or 10% of annual turnover as well as compensation, refunds and the suspension and withdrawal of authorisations or rights of use, subject to court confirmation, as appropriate. ComReg will also be permitted to enter into a new section 44 resolution agreement, to accept binding commitments and to enter into settlement agreements.
Part 7 amends the European Union (Electronic Communications Code) Regulations 2022 to provide for a higher penalty for the commission of an indictable offence which is stated to be an offence to which a statutory penalty applies. The higher level of penalty will be a fine not exceeding €10 million.
Part 8 sets out the amendments made by this Bill to the Communications Regulation Act of 2002 that are required to ensure legislative coherence and to ensure ComReg is equipped to carry out all its new functions under the code.
This Bill will provide ComReg with an enhanced and updated enforcement regime, ensuring Ireland's regulatory landscape for electronic communications is robust and dynamic enough to meet the needs of the electronic communications sector over the coming years. It will ensure Ireland meets its legal obligations regarding the transposition of the European electronic communications code.
It will enhance the security of the electronic communications services at a vital time geopolitically, it will greatly enhance consumer protections in the sector and it will ensure that the Communications Regulation Act 2002 contributes to the meeting of these objectives. I look forward to hearing the contributions from Members in the debate. I commend the Bill to the House.
I welcome the opportunity to contribute to this debate. The Communications Regulation Bill is a technical piece of legislation but one with important implications for telecommunications providers and their customers. The primary aim of the Bill is to transpose the European electronic communications code and the EU-wide regulatory framework for the telecommunications sector. This Bill aims to provide ComReg with stronger regulatory and consumer protection powers, which is very welcome. ComReg's most recent annual report highlights that it received approximately 79,000 contacts from customers over a 12-month period, highlighting the demand placed on the regulator from consumers and the need for robust powers to ensure high standards are met in the telecoms sector.
The following comments are not unique to Eir but, some time ago, the communications committee called Eir in front of it to address the high level of complaints about its standard of customer service. ComReg told us at that time that 65% of all complaints made to the regulator were from Eir customers. This chimed with the incredible amount of correspondence we received as Deputies and local councillors from people who had a dreadful customer service experience with that company. The level of anger and frustration from people who dealt with Eir and who got in touch at the time of the hearing was off the scale - it was really quite remarkable, from old to young and in all parts of the country. Eir apologised at the committee and committed to improving its service but the entire saga highlighted how weak the regulator was. In truth, ComReg has been operating with one hand tied behind its back, which has allowed poor standards and customer service problems to go unaddressed.