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Commerce Commission to target retail telcos in coming year

Competition regulator to take a close look at the retail telco customer lifecycle.
Commerce Commission chair Dr Mark Berry said retail telcos will get extra regulatory attention this year.

Commerce Commission chair Dr Mark Berry said retail telcos will get extra regulatory attention this year.

New Zealand's competition regulator, the Commerce Commission, has released its priority areas of focus for the upcoming year publicly for the first time - and retail telco service providers are high on the list.

Chairman Dr Mark Berry said almost every New Zealander uses a mobile or fixed-line phone and broadband, so the telecommunications sector has the potential to have a significant impact on consumers.

"Despite undertaking a lot of work in the sector it continues to generate a high level of complaints from consumers," he said. "This combined with our concerns about service quality indicates there is still work to be done, so retail telecommunications will be an organisation-wide priority focus area for us."

The Commission has undertaken a lot of compliance work with the sector already, and taken a number of cases, including one against Trustpower for misleading consumers over the price and terms of a bundle offer, and Vodafone for false representations on invoices. 

The Commission said it will be focusing on the life cycle of the consumer experience – from seeking information and making a purchasing decision about a product, purchasing a product, using and paying for that product, engaging with the provider and through to dispute resolution.

"We will continue to use our full range of powers and regulatory tools, including enforcement, to address non-compliance with the laws we enforce," the Commission said.

"Our initial focus will be to provide consumers with information that helps them make informed purchasing decisions as well as to know where to go when they have an issue. We also anticipate receiving greater powers as a result of proposed changes to the Telecommunications Act which will assist us in addressing issues and protecting consumers." 

Berry said the Commission's regular work in product safety, construction, cartel and anti-competitive mergers and conduct would continue.

However, in the consumer area it would focus on responsible lending, including online lending, and "credence claims", where the consumer cannot independently verify claims for themselves and must trust the seller. In particular, the Commission will be paying attention to food products and country of origin claims.

Infrastructure industries will also be a focus area.

"We will undertake work to gain a greater understanding about the performance of infrastructure industries and share that knowledge with stakeholders," Berry said. "We will also ensure we provide more accessible information about the operation of these industries to a wider audience.

The Commission’s final priority focus area is supporting the review of the Telecommunications Act, which is likely to introduce a new regime the Commission will be required to implement.