Li, Grace --- "A comparative study of the communications consumer dispute resolution schemes in the UK and Australia" [2014] UTSLRS 32; (2014) 19(2) Media and Arts Law Review 151

Last Updated: 21 August 2017

A comparative study of the communications consumer dispute resolution schemes in the UK and Australia

Dr. Grace Li
Faculty of Law, University of Technology, Sydney (UTS), Australia

Abstract: In Australia, the Telecommunications Industry Ombudsman (TIO) is a private corporation acting as the sole alternate dispute resolution mediator between carriage service providers (CSPs) and consumers. Currently, the Telecommunications Act requires all CSPs to become members of the TIO scheme in Australia. In the UK, the communications consumer dispute resolution scheme comprises two organisations: the Ombudsman Services (OS) and the Communications and Internet Services Adjudication Scheme (CISAS). The Communications Act in the UK requires all the communications providers (CPs) to join either of these two schemes. This paper studies these three similar but different redress schemes. In doing so, the author of this paper conducted a literature research of these three schemes based on publically available information. In addition, interviews with both the OS and the CISAS were carried out to access further information. In conclusion, this paper finds that the scope of the TIO is unnecessarily wider than the scope of the UK schemes, which contributed significantly to the high volume of the complaint received by the TIO in the recent years. It is therefore critical for the TIO to reconsider its scope of operation in view of limiting it. Otherwise, not only the industry development and the consumer welfare might be hindered, the TIO scheme would be overburdened in the long run.

Keywords: Telecommunications Industry Ombudsman; TIO; carriage service providers; OS Communications; Communications and Internet Services Adjudication Scheme; CISAS; communications complaints; consumer dispute resolution.

1 Introduction

In Australia, the Telecommunications Industry Ombudsman (TIO) is set up as a private, statutory corporation to act as an alternate dispute resolution mediator between carriage service providers (CSPs) and consumers.^[1] The TIO is an office of last resort, where consumers may seek assistance to resolve a dispute with a CSP after they have exhausted all avenues of resolution^[2]. Part 6 of the Telecommunications (Consumer Protection and Service Standards) Act 1999 requires all CSPs to become members of the TIO. The TIO service is free of charge to consumers and it is largely funded by its participating members, the CSPs.

Similar to the Australian system, there are two schemes in the UK dealing particularly with consumer disputes in the communications sector. The UK Communications Act 2003 requires all providers of public communications services to appoint an alternative dispute resolution (ADR) scheme to deal with unresolved disputes with domestic and small business consumers as specified in the UK Communications Act (2003). Consumers have the right to take complaints that have not been resolved within eight weeks to ADR. The ADR scheme must be approved by Ofcom and must form part of the communications provider (CP)’s code of practice. Ofcom has so far recognised two such schemes: The Ombudsman Services (OS) and the Communications and Internet Services Adjudication Scheme (CISAS). Like the TIO in Australia, the ADR schemes are free to consumers (a right that is embedded in the Communications Act 2003) and are independent of both CPs and Ofcom.^[3]

1.1 The current situation

In recent years, the number of complaints received by the TIO has increased dramatically. For example, 119,249 new complaints were received by the TIO during 2007- 2008^[4]. This number almost doubled in 2011- 2012, when 193,702 new complaints were received.^[5] This trend becomes even more outstanding when compared horizontally with other countries, such as the UK, where the communications market is regulated in a similar way. For example, both countries are running industry self- and co-regulation in their communications sector and there are industry specific dispute resolution schemes to redress consumer issues. Moreover, all these redress schemes are free of charge for consumers. ^[6]
Nonetheless, the number of consumer disputes in the UK represents a totally different trend. In terms of the headline figures, the OS received 15,572 new complaints in 2011-2012^[7] and the CISAS accepted 3,129 new disputes in the same year.^[8] Transforming these figures into the following table, the difference becomes obvious. In sum, during a single year, the TIO received and handled 193,702 new complaints, whereas its UK peers (two in total) received and handled less than 10% of that number.

Table 1:

Total number of new complaints
TIO			193,702
UK schemes	OS Communications	15572	18,701
	CISAS	3,129

Placing these figures in the context of the communications market in both countries illustrates the contrast even more clearly. The table below gives figures from 2012.

Table 2:

	Population	Landline subscriptions	Mobile phone subscriptions
Australia	23.1M[9]	10.44M[10]	30.2M[11]
UK	63.7M[12]	33.1M[13]	82.7M[14]

As Table 2 demonstrates, the communications market in the UK is significantly larger than that in Australia for both landline and mobile subscriptions. This indicates that the communications consumer base in the UK is also larger than that in Australia. It is therefore puzzling that the number of complaints received by the UK systems made up less than 10% of the complaints received by the TIO. The current paper seeks to explain this puzzling situation.

1.2 Justification for this study

There are a number of possibilities that could lead to the large number of complaints received by the TIO in Australia.
Thinking positively, this situation might be caused by different complaint-calculation methods; or a better consumer awareness of the ombudsman scheme; or different standards used in different ombudsman organisations to accept and investigate complaints; or a wider scope of the TIO. However, thinking negatively, this situation could also be caused by unsatisfactory industry performance, which failed to meet the expectation of its consumers. When the failure is on this scale, it may call into question the effectiveness of the industry self-regulation.^[15] An in-depth study is therefore required to assess the effectiveness of the TIO scheme.
In this context, a research project was conducted in the second half of 2013 to study the above possibilities, and to ascertain which might be the cause/causes of the extraordinary number of complaints received by the TIO in recent years. This paper then highlights the differences and similarities in both systems. In particular, it examines the regulatory environment and the roles and functions of the different schemes in the communications industry in both countries and compares the operation of these schemes in detail.
The author took a comparative approach in this study to compare the dispute resolution schemes currently adopted in the UK and Australia. As a comparable jurisdiction, the UK is chosen for two reasons including: one, in regards to the regulatory environment, both UK and Australia promote an industry self-regulation approach in their telecommunications industry; and two, both UK and Australia are running industry ombudsman scheme. The following part of this paper will further explain these points in more details.

2. Regulatory Context for the Study

2.1 The regulatory environment

Australia

Australia promotes the “greatest practicable use of industry self-regulation”.^[16] The regulators have specific roles in the communications regime, which can extend to a co-regulatory function of approving and enforcing industry codes and standards. The stakeholders of the regulatory environment include: the communications regulator: the Australian Communications and Media Authority (ACMA), the competition regulator: the Australian Competition and Consumer Commission (ACCC), the industry self-regulation body: The TIO and two other active organisations to represent consumers (the Communications Alliance) and to handle Internet related codes (Internet Industry Association).
Australia was the first country in the world to introduce a telecommunications industry ombudsman. The organisation was created as a private statutory corporation in 1993. The corporation consists of members who are carriers or carriage service providers mandated by section 128 of the Telecommunications (Consumer Protection and Service Standards) Act 1999 (Cth) to join the scheme.
The TIO plays various important roles in the Australian telecommunications industry. Its first and primary role is to provide a dispute resolution service that is accessible, independent, fair, efficient, responsive and effective to the consumers. Secondly, the TIO assists telecommunications service providers and their industry to improve their services to consumers, through identifying systemic issues and engaging with industry representatives. Thirdly, the TIO is an independent and expert voice about matters affecting telecommunications consumers. In this regard, the TIO provides information and analysis to government and industry, and reaches out to the community.^[17]

The UK

The Office of Communications (Ofcom) is “the UK’s converged communications regulator”.^[18] Other communications regulatory agencies include the Office of Telecommunications Adjudicator (OTA2) and the Competition and Markets Authority (CMA).^[19]
The communication consumer dispute resolution scheme in the UK has some similarities to the Australia scheme, which requires that all communications providers in the UK (including providers of fixed, mobile and broadband services) serving domestic and small business customers join an ADR scheme approved by Ofcom.^[20] If unsatisfied after complaining to their providers, consumers can refer issues to their provider’s scheme and have the issues considered by an independent ombudsman.^[21]
There are two Ofcom-approved ADR schemes in the UK currently: the OS Communications and the CISAS. All CPs must belong to one of the schemes.^[22] In addition, in December 2007, Ofcom confirmed that another not-for-profit company, PhonepayPlus, would act as its agency to carry out the day-to-day regulation of the premium rate services market on its behalf.^[23]

Similarities and differences of the communications ADR schemes in Australia and the UK

It becomes clear at this point that the communications ADR schemes in the Australia and the UK are comparable. Both of them have a converged regulator who approves an ADR scheme (or ADR schemes) as an important mechanism to redress consumer issues. These ADR schemes are registered companies and they all claim to be independent from the regulator, industry and consumers. These ADR schemes are free of charge to residential or small business consumers and they are funded through the participating companies. However, Ofcom has approved two schemes, which are in competition with each other, whereas there is only one scheme in Australia, the TIO scheme. In addition, Ofcom has approved a specific body to be responsible for the regulation of premium rate services, named PhonePay Plus, whereas in Australia, no such specific body has been established.
Nonetheless, due to the specific function of PhonePay Plus, it is not considered comparable to the TIO for the purpose of this study. The following parts of this paper will therefore provide comparison of three schemes (TIO, OS and CISAS) in more detail.

2.2 The communications dispute resolution schemes

The TIO Scheme

The jurisdiction of the TIO scheme is defined by a combination of Sections 5 and 6 of the Telecommunications (Consumer Protection and Service Standards) Act (1999) and its Constitution.
The TIO has a wide jurisdiction to investigate complaints regarding fixed and mobile telephone services, Internet access, as well as a number of other services provided by the CSPs in Australia^[24]. If in the course of the investigation of a complaint, TIO determines that an industry code has been breached, it is obliged to refer code violations or systematic problems to the Australian Communications regulator, the ACMA, which may then elect to undertake a form of enforcement method such as prosecution.^[25] As a result, TIO holds a dual role as a quasi-judiciary and an industry co-regulator^[26].
In regard to financial awards, TIO has the authority to make binding decisions^[27] up to the value of $50,000, and Recommendations up to the value of $100,000. The TIO also has the power to exercise its discretion not to investigate or further investigate a case in certain circumstances.^[28]
With respect to the complainants, TIO accepts complaints made by residential consumers or small businesses.^[29] The definition of “small business” includes businesses employing up to 20 full-time employees and having up to $3,000,000 in annual turnover.^[30]
With regard to the time limit for making complaints, TIO normally accepts complaints up to 2 years since the complaint matter occurred. In some circumstances, TIO also accepts complaints up to 6 years old if the complainants have a good reason for not raising it before.^[31] In fact, this time limit was extended recently in July 2013. The previous time limits were, respectively, 12 months and 2 years.^[32] TIO believes that the new 2-year time limit for complaints matches the most common length of a telecommunications contract and this extension of time limits will make the scheme more accessible to consumers.^[33]
A related point is that TIO can also examine complaints where a CSP has had a reasonable opportunity to consider a complaint but the complainant remains unsatisfied – and this situation is guided by the industry code which notes that the timeframe for resolving complaints is typically 30 calendar days.^[34]
The conversion rate is another consideration that should be mentioned in this discussion. Conversion rate normally refers to the percentage of consumer contacts which are subsequently accepted as formal complaints and then dealt with by the ombudsman organisation. TIO’s conversion rate is calculated below in table 3 based on the figures from TIO’s annual reports.^[35]

Table 3

	New complaints[36]	Enquiries[37]	Total number of contacts[38]	Conversion rate[39]
2008-09	175,946	30,650	206,596	85.20%
2009-10	167,772	39,805	207,577	80.10%
2010-11	197,682	39,928	237,610	83.20%
2011-12	193,702	53,131	246,833	78.50%

Calculating from this table, the average conversion rate of TIO in the past 4 years was 81.8%, which means about 4 out of every 5 contacts that TIO received fell under TIO’s jurisdiction.

OS: Communications Scheme

In the UK, the OS scheme handles the following types of complaints: billing problems; problems resulting from a company’s sales activity; problems resulting from switching from one company to another; and poor service, for example, failing to act on a request.^[40]
In terms of financial awards, the OS can require a financial award up to £10,000 (AUD$15,000) from its member companies.^[41] As for complainants, OS: Communications deals with domestic and small business customers. A small business customer is defined as one that spends less than £5,000 (AUD$7,500) per year with the communications company or one that employs ten people or fewer.^[42]
When it comes to the time limit for making complaints, the OS only deals with complaints that are within 9 months from the date that the consumer first complained to the company.^[43] In addition, the OS will only get involved when the consumer receives the communications company’s final response to a complaint and still remains unhappy, or when eight weeks have passed and the complaint is unresolved.^[44]
Regarding the conversion rate, the OS responded to 71,117 new communications contacts during 2012/13, approximately 20% of which were within its terms of reference.^[45] Looking back at the previous years, the conversion rate was 20% in 2011/12,^[46] 25% in 2010/11, and 15% in 2009/10^[47]. This works out at an average conversion rate of 20% in the past 4 years.

CISAS Scheme

The CISAS scheme can be used to settle disputes on bills and communication services provided to customers. The dispute cannot involve a claim for an amount more than £10,000 (AUD$15,000) including VAT for any one customer.^[48]
As for the complainants, CISAS accepts applications from individuals and small businesses with 10 or fewer employees.^[49] In regards to the time limit for making complaints, the customers have to demonstrate that they have not been able to settle the dispute with the company within eight weeks of complaining to the company; or the company agrees, in writing, that the dispute can be settled through the scheme. Customers must normally apply to the scheme within nine months of first complaining to the company. However, CISAS can extend this to a twelve-month period in exceptional circumstances if both the customer and the company agree or if, in its opinion, the company has unreasonably delayed handling the complaint.^[50]
In terms of the conversion rate, the CISAS received 6,387 enquiries in 2012, of which 3,129 enquiries have been considered as valid applications. This works out at a conversion rate of 49%. Looking back at previous years, the conversion rate was 41% in 2011, 33% in 2010, and 32% in 2009. So the average conversion rate was 39% in the past 4 years.^[51]

Comparison

To summarise the scope of these three schemes, Table 4 provides a snapshot below.

Table 4

	Awards	Complainants	Timelines	Conversion rates
The TIO	Binding decisions up to $50,000; Recommendations up to $100,000	Domestic consumers & small businesses Small businesses include businesses employing up to 20 full-time employees and up to $3,000,000 annual turnover.	Complaints need to be less than 2 years old and up to 6 years old in some situations. CSPs have about 4 weeks to deal with the consumer complaint before the consumer can bring the complaint matter to TIO	81.80%
OS Communications	a financial award up to £10,000 (AUD$15,000)	Domestic consumers & small businesses Small businesses are businesses that spend less than £5,000 (AUD$7,500) per year with the communications company or employ 10 or fewer employees.	Consumers can enter into this scheme after eight weeks of complaining to the company and within nine months of first complaining to the company	20%
CISAS	a financial award up to £10,000 (AUD$15,000)	Domestic consumers & small businesses Small businesses are businesses with 10 or fewer employees.	Consumers can enter into this scheme after eight weeks of complaining to the company and within twelve months from first complaining to the company	39%

Table 4 demonstrates that despite the similar jurisdictions of these three schemes, the scope of TIO is significantly broader than the scope of the other two.
Firstly, TIO is open to businesses that are double the size of the other two schemes. Secondly, TIO’s awards can be up to $50,000, whereas the awards from the other two schemes can only be up to approximately $15,000. Another significant difference is the time limit for making complaints. TIO’s time limit for making complaints is significantly longer than the other two schemes – the deadline to bring a complaint to OS is nine months from the first complaint to the company and CISAS has a twelve month deadline. In comparison, TIO’s standard deadline is 2 years and it also accepts complaints up to 6 years in some situations. In addition, TIO allows only 30 days for its CSPs to deal with the consumer complaints internally whereas the UK ombudsman organisations use 8 weeks as the threshold. It then becomes apparent that the TIO scheme is substantively more accessible than the UK schemes in regarding to the criteria for accepting complaints.
Regarding the conversion rate, this table of comparison illustrates that the conversion rate of TIO is considerably highly than its UK peers. This situation might be a natural consequence of the wider scope of the TIO. However, there might be other reasons contributing to it at the same time. For instance, the personal judgment or subtle criteria for accepting complaints by individual case officers might result in different decisions as to whether a particular complaint is genuine or frivolous. We cannot obtain insights about such hidden factors merely by analysing the above statistics.

3. Interviews

In order to access further information on these schemes and to broaden the findings of the statistics presented above, two interviews were conducted in October 2013 with the OS and CISAS in the UK.^[52]

3.1 Interview with OS personnel

The interview with OS was conducted in the OS office site in Warrington, North West England. This two-hour interview covered a variety of questions from complaint-handling and staff arrangements to organisational publications. General questions were also discussed regarding the consumer dispute resolution schemes in both the UK and Australia.
This interview confirmed the following matters identified from the desk research. First of all, OS has a similar set of functions to TIO. Both directly deal with industry specific consumer complaints and both schemes require the service providers to comply with their decision once the decision is accepted by the consumers. Secondly, the scope of OS is narrower than that of TIO in terms of the amount of financial awards, time limits and the general accessibility of the scheme.
The differences between these two schemes were also discussed in detail at the interview. It is noted that OS as an overarching body of the OS:communications has an important role to play in consumer dispute resolution in a number of industries, including not only communications, but also energy, property, and copyright licensing. Although communication-related complaints have been a dominant area that OS has worked on, it does deal with complaints from other industries as well. In fact, there is no separation in personnel between the officers who deal with communications complaints and other officers who deal with complaints from other industries. In comparison, TIO in Australia deals with communications complaints only. On this particular point, OS performs its role or represents itself more generally as a cross-border dispute resolution scheme rather than a specific industry scheme. For this reason, when staff arrangements were discussed at the interview, it is not surprising that the officers who deal with complaints in OS do not necessarily have any particular background in any given industry. The staff selection is purely competence based.
In regard to the operation of the organisation, OS runs like a regular commercial company with a board and a Chief Ombudsman sitting at the top of the organisational structure, and with four directors each responsible for different service items underneath. Corporate services are provided centrally, such as finance and HR, so there is no separate service team for any individual industry.
In regard to the decision-making process, OS runs internal reviews of its decisions. The decisions can be reviewed by the Ombudsman and this review can be initiated by consumers or by the ombudsman him/herself. The OS also appoints an independent adjudicator (IA). The IA’s function is to assess whether process has been followed in decision making; it is, however, not to review the actual substance of decisions or their outcomes. In addition, Ofcom also conducts reviews of OS regarding the decision-making process.
It became clear from the interview that the consistency of decisions is less of a concern in the OS scheme although it is regarded as a matter that would always be relevant. This is because OS believes that every case is on its own merits and they do not create precedents although they do document all the decisions.

3.2 Interview with CISAS

The interview with CISAS took place in the office of CISAS in central London. Again, this interview covered a variety of questions similar to those discussed at the interview with OS.
As an industry specific adjudication service provider, CISAS deals with disputes between communications consumers and service providers only. In doing so, CISAS takes legal approach to its decision making. The legal test of ‘the balance of probability’ is regarded as the most important principle in making decisions by the panel of adjudicators in CISAS. At the same time, the rules of CISAS state that the adjudicators would have to make a reasonable and fair decision. In regard to CISAS’ decisions, there is a proforma that all the adjudicators follow, in which information regarding the dispute is highlighted, such as the factual elements and the claims of the disputing parties. In addition, the adjudicators also state their findings and reasoning as well as the final decision.
The ‘glass wall’ is another term that came out starkly in the interview. The ‘glass wall’ is a separation between the administration of CISAS and its adjudicators. It is also a separation between the adjudicators and the disputing parties, including the claimants and the service providers. This glass wall has been deliberately created and maintained in CISAS’s internal operation in order to ensure the impartiality of its decisions.
It is also interesting to note that CISAS does not offer any review process of its decisions, which is different from the OS procedure. Once the decision is made by the adjudicators in CISAS, it is up to the consumer as to whether they accept it or not. The company will need to comply with the decision if the consumer accepts it within the given time period. CISAS views its system as a stage one dispute resolution, which does not take away the consumer’s right to be heard before the court.

3.3 Analysis of the interviews

In general, the interviews with both OS and CISAS, together with the statistical analysis conducted prior to the interviews, has outlined a clear picture of the communications consumer redress scheme in the UK. The two different UK schemes are working independently but complementary to each other under the guidance of Ofcom. Although they both share similarities such as compulsory membership and similar funding structures, they each look at different aspects of the dispute and they each make decisions by using their own decision making approach.
One of the noticeable features shared by these two schemes is their opinion on publishing case decisions. Neither of them creates precedents in decision making and they both believe that every case should be on its own merits. For the same reason, neither considers that publishing case decisions like courts would be necessary. Instead, they both choose to publish selected edited case studies, which are based on real disputes. They believe publishing case studies works better in delivering information to the relevant parties. It is arguable that this approach might potentially risk the consistency of the decisions made in the two different schemes. However, Ofcom has confirmed in its 2012 alternative dispute resolution review^[53] that these two schemes are indeed comparable and the consistency of their decisions is not of concern. Not surprisingly, both schemes believe the current system is working well.
Furthermore, on the decision-making personnel, although Ofcom holds the view that the decisions by these two different schemes are comparable; the interviews clearly show that the decision makers in these two schemes are very different in terms of their background. In OS, the enquiry officers and the investigation officers come from a variety of different backgrounds. Previous legal education is not required for their role. Their decisions would then largely look at the reasonableness and fairness of the conduct from a layperson’s perspective. In comparison, CISAS provides adjudication services and the panel of adjudicators have received comprehensive legal training. It is therefore not surprising to see that the approach of CISAS is straight down the line based on the balance of probability; and the consumers, in other words the applicants, have to prove the case according to the standard civil procedure principles. On this particular point, this author believes that it is questionable whether the findings of Ofcom in its 2012 Review of Alternative Dispute Resolution Schemes Statement reflect the true quality of the decisions in regard to the comparableness of these two schemes.

4 Overall analysis and Conclusion

The interviews with the UK schemes were then compared with TIO scheme based on publically available information from the TIO’s website. There are a number of arguments stemmed out from this research and this paper will specify them below.

4.1 the TIO related arguments

The difference in the scope of the UK schemes and the TIO scheme is discussed previously in part 2; and in part 3, the interviews with the UK schemes confirm that they both believe the current UK schemes are working well, which was also confirmed by Ofcom in its 2012 review.^[54] If we accept the assumption that the UK schemes do work well, a question would naturally emerge from this comparison as to whether it is necessary for the TIO to have such a wide scope for a comparatively smaller market.
In general, it is not difficult to justify the fact that the scope of a particular scheme might not be the same as its peer schemes elsewhere. There could be countless reasons to support this situation, such as the size of the market, the players, historical reasons, the law and regulations, even cultural differences. In fact, these differences might even help the development of the scheme if these differences can be utilised in a positive way. For instance, one scheme might have opportunity to learn from another different scheme and then to improve itself.
However, the fact that the scope of the TIO scheme is significantly larger than that of the similar schemes in the UK poses some interesting controversies: on the one hand, one might praise such a broad scope by saying that the TIO scheme in Australia is more accessible for the communications consumers and TIO’s awards can meet the needs of a wider population of consumers; on the other hand, one can criticise the TIO scheme for being unnecessarily broad, which would not only harm the industry overall but also pass on the financial burden of complaint-handling from the industry to consumers ultimately. If this is the case, neither the industry nor consumers fully benefit from the scheme. In addition, if the critics are correct, the consumer confidence in the industry will be compromised and TIO itself can also be overburdened in the long run.
A nature step from here would be asking for the justifications of the TIO’s scope of operation. The author of this paper has researched extensively on the publically available information as well as the TIO’s decisions on the scope of its operation. Unfortunately that little information regarding how the scope of TIO was decided in the first place could be allocated.
As mentioned few times in previous parts of this paper, TIO further extended its scope of operation in 2013.^[55] A website announcement was released by TIO on 1 July 2013, which stated the extension of the time limit from 12 month to 2 years for consumers to bring their compliant into its scheme. There was also a brief explanation as to the reasons for this extension, which reads “the change brings the TIO more closely in to line with national benchmarks for industry Ombudsman, the time limits of other national Ombudsman and statutes of limitation for simple contracts. The two-year time limit matches the most common length of a telecommunications contract. The six-year limit allows for most or all pre- and post-contractual interactions to be considered, including handling the root causes of disputed default listings” .^[56]
This justification for time limit extension could be problematic in the view of this paper. Firstly, it does not provide a clear explanation as to how the extension of the time limits is in line with the national benchmarks for industry Ombudsman (the benchmarks). Looking into the benchmarks^[57], there are a total of six benchmarks identified: accessibility, independence, fairness, accountability, efficiency and effectiveness. The particular benchmark on the accessibility would be relevant to this extension of time limit by TIO. The ‘accessibility’ principle in the benchmark document requires ‘the scheme makes itself readily available to customers by promoting knowledge of its existence, being easy to use and having no cost barriers’.^[58] There is however no specific policy on the time limit that allows the consumers to bring the matter to the relevant body. In terms of practicality of this principle, six key practices are identified, including awareness/promotion, access, cost, staff assistance, use non-adversarial approach, and legal representation. The overall purpose of this principle is to promote customer access to the scheme on an equitable basis, which is, in this view of this paper, related to setting or amending time limit for consumer to bring up the matter but not (necessarily) to request a longer time limit in consumer scheme. The TIO’s reasoning of “...in line with national benchmarks for industry Ombudsman...” is therefore questionable.
Further on, the second reason provided by the TIO is: “the change brings the TIO more closely in line with ... the time limits of other national Ombudsman and statutes of limitation for simple contracts”. There are a number of ombudsman schemes in Australia, such as Energy and Water Ombudsman at the state level and Financial Ombudsman Services at the national level. This paper believes that although all the ombudsmen schemes share an overall aim to provide free services to the consumer based on the fair and reasonable principle, they can still be different in running out their services. In particular, this paper believes that it would not be necessary to compare all the industry ombudsman schemes in the country because the needs of the industries do vary. In the same token, the utility industry might be the most comparable industry to the telecommunications industry. They do share some common characteristics. When looking into the utility ombudsman schemes in Australia, the time limit set for consumers to bring their matters into the schemes is 12 month cross all the utility ombudsman schemes. More specifically, the Energy & Water Ombudsman NSW specifies a 12 month limit in its charter (s4.3)^[59]; the Energy and Water Ombudsman Queensland specifies a 12 month limit in its ACT (s19 A 1 (a))^[60]; and, the Energy and Water Ombudsman Victoria also specifies a 12 month limit in its Charter (s 3.2 (b))^[61]. This paper assumes that the ombudsman scheme that the TIO uses as its reference to the 2-year time limit would be the Financial Ombudsman Services (FOS). Yes, the FOS does have a 2-year time limit for dispute relates to a variation of a credit contract as a result of financial hardship, an unjust transaction or unconscionable interest and other charges under the National Credit Code; and a 6 year time limit for other dispute .^[62] However, the financial service industry operates significantly different from the communications industry. The nature of the financial contracts is very different from the communications contracts as well. Therefore, this paper is in the option that the TIO’s adoption of 2/6 year time limit is not appropriate. Instead, the TIO should look at other industry schemes which is more comparable, such as the utility ombudsman schemes; or the TIO should look at similar schemes in other jurisdictions such as the communications dispute resolution schemes in the UK. Moreover, in light of the large number of complaints that has been received by the TIO in the recent years, it would be fair to say that there is a clear lack of justification on the TIO’s further extension of its time limit in 2013.

4.2 the objectives of the industry regulation

Self-regulation and co-regulation have been viewed as an effective tool to achieve various regulatory objectives and they also form part of the enforcement pyramid model. It has been argued that regulatory responses should not be confined to escalations up the enforcement pyramid, but should also consider industry responses or allowing instruments to be implemented by industry associations (in this paper, means the communications companies) and professions as well as regulators. R Baldwin and J Black found that ‘seeing regulation in terms of these dimensions allows creative mixes, or networks, of regulatory enforcement instruments and of influencing actors or institutions to be adopted. It also encompasses the use of control instruments that, in certain contexts, may be easier to apply, less costly and more influential than state controls’^[63].
It might then worthwhile to look at the objectives of the industry regulation at this point. This paper argues that the ultimate purpose of industry regulation is to provide a better environment for industry to obtain healthy growth without compromising consumers’ welfare. Therefore, factors such as accessibility and affordability are important, but they need to serve for the ultimate goal of regulation, which is the industry development and the consumer welfare. In other words, accessibility should only be viewed as a tool to achieve the purpose of industry development and consumer welfare. It is thus an incorrect opinion to believe that accessibility is ‘the’ goal of the dispute resolution scheme.
Further on the accessibility, it will be a narrow view to regard the ‘accessibility’ equals to ‘how many complaints are received and handled’. In other words, a conclusion that one scheme is more accessible, which is concluded purely based on the fact that it is handling more complaints than other comparable schemes might not be an accurate conclusion. Many other considerations might also affect the scheme at the same time. Examples of these considerations include how effective the complaints are solved or dealt with by the scheme; what is the unit cost of solving the complaint by the scheme; how long does it take for the scheme to solve a single compliant in average; how much does it the cost for responding to the compliant by the service providers and so on. Unfortunately that, from reading the information on the TIO’s website, the understanding of the TIO’s accessibility is largely associated with the wide scope of its operation and the large number of compliant received as a direct result of it.
At the same time, similarly to all other ADR schemes, the ombudsman schemes need to be independent and fair for both the participating members and consumers. All the schemes examined in this research confirmed their independent status and proclaimed that fairness is the key consideration in their decision-making. They should therefore act neither as industry representatives nor as consumer advocates. Limiting access to the scheme may cause critics to accuse the scheme of being merely an industry representative, but widening access to the scheme may tip the balance too far in favour of consumer advocacy. Thus, finding the balancing point is a vital task for all such ombudsman schemes around the world. Both UK and Australia have several attempts to adjust this balance in recent years including the Improving Access to Alternative Dispute Resolution report produced by Ofcom^[64] as well as the recent time limit extension by TIO^[65].
Speaking on extension of the time limit again, it is inevitable that the TIO deals with more complaints as a result of this extension, so the industry pays more to resolve these complaints, then the industry may pass on the costs of complaint handling to consumers by increasing its service charges. This means that the only winner will be extra consumer complainants. It is not clear to the author whether that if there has been industry consultation took place before this decision was made by TIO or if there was any consideration of industry cost estimates from implementing such an extension. A decision like this might therefore attract the criticism that TIO is acting as a consumer advocate.
Another separate but related issue is that there are two different types of dispute resolution schemes working in the same industry. They are the adjudication services such as CISAS and the ombudsman services such as OS and TIO. Prima facie, they both are operating in a similar way in terms of funding structures and compliant handling processes, but the rationales for decision making are rather different. The basis for decision making in ombudsman scheme is ‘fair and reasonable’ while the basis for adjudication scheme is the traditional civil principle of ‘the balance of probability’. On this particular point, it becomes arguable that if the decisions made by adjudicators normally have more merit and consequently deliver more equitable or just results than the decisions made by laypersons in the ombudsman service. This could also lead to some more radical questions, for example, is the ombudsman scheme still the best choice in the current communications regulatory environment? Or, is it more beneficial to use an adjudication service rather than an ombudsman service? Moreover, a different but relating question can also stem out from this argument: does a single dispute resolution scheme model work better than a competitive model with more than one scheme? Given the fact that the TIO is extremely busy with the complaints received, would the industry and the consumers in Australia be better off if there is another scheme that they could go to?
These questions are not easy questions to answer. Unfortunately that seeking for the answers here would worth a series of further study.

4.3 Conclusion

To conclude, at the current stage of this study, this paper finds that the wide scope of the TIO scheme is a main cause for the significant number of complaints received in the past few years by the TIO in Australia. The TIO’s scope of operation is considerably larger than its peer organisations in the UK’s communications industry and its peer domestic ombudsman schemes in the Australian utility industry.
The scope of the TIO scheme is wide based on a number of grounds, including (primarily) the higher financial award power hold by the TIO, a wider population of the complainant that can access to the TIO scheme, and a wider timeline for the TIO to accept the compliant into its operation. These factors are all associated with TIO’s higher conversion rate. More importantly, this paper finds that there is a lack of justification as to why the TIO should have this wide scope of operation.
Based on the findings above, in conclusion, this paper argues that the TIO scheme needs to re-consider its operation in view of reducing its jurisdiction into a more manageable scope and in line with its peer organisations both domestic and international. Otherwise, not only the industry development and the consumer welfare would be hindered, the TIO scheme would also be overburdened in the long run.

---

^[1] The jurisdiction of the TIO covers both residential consumers and small businesses. Re: Telecommunications Industry Ombudsman, Who can complain (2013) <http://www.tio.com.au/consumers/who-can-complain> .
Enquires are the contacts received by the TIO which are the matters that the TIO cannot deal with directly or that are outside of the TIO’s function and powers. http://www.tio.com.au/about-us/policies-and-procedures.
^[2] Telecommunications Industry Ombudsman, Complaint handling procedures (2013) <http://www.tio.com.au/ about-us/policies-and-procedures> .
^[3] Ofcom, The use of Alternative Dispute Resolution as a means to resolve disputes related to commercial transactions and practices in the European Union: Ofcom’s Contribution to the European Commission Consultation (2011) <http://ec.europa.eu/dgs/health_consumer/dgs_consultations/ca/adr_consultation_18012011_en.htm> .
^[4] Telecommunication Industry Ombudsman, Telecommunication Industry Ombudsman Annual Report 2008 (2008) <http://annualreport.tio.com.au/__data/assets/pdf_file/0005/ 107735/TIO -2008-Annual-Report.pdf> .
^[5] Telecommunication Industry Ombudsman, Telecommunication Industry Ombudsman Annual Report 2012 (2012) <http://annualreport.tio.com.au/__data/assets/pdf_file/0005/ 107735/TIO -2012-Annual-Report.pdf> .
^[6] Australian Telecommunications Regulation 2012, 2^nd edition.
^[7] Ombudsman Services, Ombudsman Services Resolving Consumer Disputes Annual Report and accounts 2011.12 <http://www.ombudsman-services.org/downloads/OS 2012 AR 3-7-12 for web.pdf> .
^[8] Communications & Internet Services Adjudication Scheme, CISAS Annual Report 2011-2012 CISAS Annual Report 2012 (2013) <http://www.cedr.com/docslib/CISAS_AR_2012.pdf> .
^[9] Australian Bureau of Statistics, Population Clock at 22 August 2013 <http://www.abs.gov.au/ausstats/abs%40. nsf/94713ad445ff1425ca25682000192af2/1647509ef7e25faaca2568a900154b63?OpenDocument> .
^[10] Australian Communications and Media Authority, Chapter 1 The Australian Communications and media market, ACMA Communications report 2010-11 <http://www.acma.gov.au/webwr/_assets/main/lib410148/chapter %201_the_aus_communications_and_media_market.pdf> .
^[11] Australian Communications and Media Authority, Chapter 1 The Australian Communications and media market, ACMA Communications report 2010-11 <http://www.acma.gov.au/webwr/_assets/main/lib410148/chapter %201_the_aus_communications_and_media_market.pdf> .
^[12] Office of National Statistics, Population (08 August 2013) <http://www.ons.gov.uk/ons/taxonomy/index.html? nscl=Population> .
^[13] Ofcom, Ofcom Communications Market Report 2013 (1 August 2013) <http://stakeholders.ofcom.org.uk/ binaries/research/cmr/cmr13/2013_UK_CMR.pdf> .
^[14] Ofcom, Ofcom Communications Market Report 2013 (1 August 2013) <http://stakeholders.ofcom.org.uk/ binaries/research/cmr/cmr13/2013_UK_CMR.pdf> .
^[15] Graham, Cosmo, ‘Complaints handling and telecommunications in the United Kingdom and Australia’ (2011) 61 (1) Telecommunications Journal of Australia, 8.1- 8.12.
^[16] Telecommunications Act 1997(Cth) s 101.
^[17] Telecommunications Industry Ombudsman, About us (2013) <http://www.tio.com.au/about-us> .
^[18] Ofcom, What is Ofcom <http://www.ofcom.org.uk/about/what-is-ofcom/> .
^[19] The UK Office of Fair Trading and the Competition Commission were succeeded in April 2014 by the Competition and Markets Authority.< https://www.gov.uk/government/organisations/competition-and-markets-authority >
^[20] Ofcom, Dispute Resolution <http://consumers.ofcom.org.uk/tell-us/telecoms/adr/> .
^[21] Ofcom, Improving Access to Alternative Dispute Resolution (19 May 2009) <http://stakeholders.ofcom.org.uk/ binaries/consultations/alt_dis_res/statement/statement.pdf> .
^[22] Ofcom, Dispute resolution <http://consumers.ofcom.org.uk/tell-us/telecoms/adr/> .
^[23] PhonepayPlus, Regulating to build trust in phone-paid services <http://www.phonepayplus.org.uk/About-PhonepayPlus.aspx> .
^[24] The TIO has a wide jurisdiction to investigate complaints regarding fixed and mobile telephone services; the provision of Internet access; operator and directory assistance services; fault reporting and repair; printed and electronic directories; billing not in accordance or failure to supply a service with respect to Part 23 of the Telecommunications Act; and interference with the privacy of an individual with respect to the Privacy Act 1988 or industry codes; as well as failure to access a carriage service as a result of a failure in customer premises equipment supplied to facilitate access to that carriage service. If in the course of the investigation of a complaint, the TIO determines that an industry code has been breached, it is obliged to refer code violations or systematic problems to the Australian Communications regulator, the ACMA, which may then elect to undertake a form of enforcement method such as prosecution.
Telecommunications Industry Ombudsman, TIO Constitution (1 July 2013) <http://www.tio.com.au/__data/ assets/pdf_file/0015/9132/TIO-Constitution-1-July-2013.pdf> .
^[25] Telecommunications (Consumer Protection and Service Standards) Act 1999, ss126-133.
^[26]Stuhmcke Anita, ‘The Corporatisation and Privatisation of the Australian Telecommunications Industry: The Role of the Telecommunications Industry Ombudsman’ [1998] UNSWLawJl 67; (1998) 21(3) University of New South Wales Law Journal, 807-833.
^[27] Binding decisions are the decisions that the telecommunications company (CSP) is legally obliged to implement.
^[28] Telecommunications Industry Ombudsman, Power (2013) <http://www.tio.com.au/about-us> . Telecommunications Industry Ombudsman, Who can complain (2013) <http://www.tio.com.au/consumers/who-can-complain> .
^[29] Telecommunications Industry Ombudsman, Who can complain (2013) <http://www.tio.com.au/consumers/who-can-complain> .
^[30] Telecommunications Industry Ombudsman, Small businesses (2013) <http://www.tio.com.au/consumers/small-businesses> .
^[31] Telecommunications Industry Ombudsman, Who can complain (2013) <http://www.tio.com.au/consumers/who-can-complain> .
^[32] Consumers have longer to lodge complaints with telco Ombudsman. Re: Telecommunications Industry Ombudsman, Who can complain (2013) <http://www.tio.com.au/consumers/who-can-complain> .
^[33] Telecommunications Industry Ombudsman, Consumers have longer to lodge complaints with telco Ombudsman (2013) <http://www.tio.com.au/publications/media/consumers-have-longer-to-lodge-complaints-with-telco-ombuds man2> .
^[34] Australian Communications Industry Forum, ‘Industry Code: ACIF C547: 2004 Complaint Handling’(2004) cl 7.32. <http://www.acma.gov.au/webwr/telcomm/industry_codes/codes/c547b_2004(1).pdf> .
^[35] Telecommunication Industry Ombudsman, Telecommunication Industry Ombudsman Annual Report 2012 (2012) <http://annualreport.tio.com.au/__data/assets/pdf_file/0005/107735/TIO-2012-Annual-Report.pdf> .
^[36] New complaints are matters that TIO refers back to the service provider for a final chance at resolution without TIO’s involvement. Re: Telecommunication Industry Ombudsman, Telecommunication Industry Ombudsman Annual Report 2012 (2012) <http://annualreport.tio.com.au/__data/assets/pdf_file/0005/ 107735/TIO -2012-Annual-Report.pdf> .
^[37] Enquiries are matters that TIO cannot deal with directly or that are outside TIO’s function and powers. Re: Telecommunication Industry Ombudsman, Telecommunication Industry Ombudsman Annual Report 2012 (2012) <http://annualreport.tio.com.au/__data/assets/pdf_file/0005/107735/TIO-2012-Annual-Report.pdf> .
^[38] Total number of contacts is the sum of the new complaints and the enquiries in that year. However, TIO also received level 2, 3 and 4 complaints in these years, but this study chooses not to calculate level 2-4 complaints due to the fact that the new contacts in these complaints cannot be determined from TIO’s annual report. Re: Telecommunication Industry Ombudsman, Telecommunication Industry Ombudsman Annual Report 2012 (2012) <http://annualreport.tio.com.au/__data/assets/pdf_file/0005/107735/TIO-2012-Annual-Report.pdf> .
^[39] These conversion rates are the percentage of the consumer contacts which were accepted and dealt with by TIO. As explained in the footnote above, level 2-4 complaints are not counted in this conversion rate. The conversion rate will be higher if those level 2-4 complaints are added in. Re: Telecommunication Industry Ombudsman, Telecommunication Industry Ombudsman Annual Report 2012 (2012), <http://annualreport.tio.com.au/__data/assets/pdf_file/0005/107735/TIO-2012-Annual-Report.pdf> .
^[40] Ombudsman Service, About Ombudsman Services: Communications (February 2013) <http://www.ombudsman-services.org/downloads/OScommunications_factsheetLP.pdf> .
^[41] Ombudsman Service, About Ombudsman Services: Communications (February 2013 <http://www.ombudsman-services.org/downloads/OScommunications_factsheetLP.pdf> .
^[42] Ombudsman Service, About Ombudsman Services: Communications (February 2013) <http://www.ombudsman-services.org/downloads/OScommunications_factsheetLP.pdf> .
^[43]Ombudsman Services: Communications <http://www.ombudsman-services.org/who-can-we-helpcommunica tions. html> .
^[44]Ombudsman Service, About Ombudsman Services: Communications (February 2013) <http://www. ombudsmanservices.org/downloads/OScommunications _factsheetLP.pdf> .
^[45] Ombudsman Services, Annual Report and accounts 2012/ 2013 http://www.ombudsmanservices.org/down loads/OS%20Annual%20Report%202013.pdf.
^[46] Ombudsman service, Annual report and accounts 2011/2012 <http://www.ombudsmanservices.org/downloads/ OS%202012%20AR%203-7-12%20for%20web.pdf> .
^[47] Ombudsman service, Annual report and accounts 2010/2011 <http://www.ombudsmanservices.org/downloads/ Communications%202011%20AR.pdf> .
^[48] The Communications and Internet Services Adjudication Scheme, CISAS rules (2011edtion) <http://www.cisas. org.uk/CISASRules-12_e.html> .
^[49] The Communications and Internet Services Adjudication Scheme, Information for Customers (2^nd February 2012) <http://www.cisas.org.uk/CustomerInformation-4_e.html> .
^[50] The Communications and Internet Services Adjudication Scheme, CISAS rules (2013edtion) <http://www.cisas.org.uk/downloads/CISAS%20RULES%202013%20-%20Final%20Nov%202013.pdf> .
^[51] The Communications and Internet Services Adjudication Scheme, CISAS Annual Report, 2011-2012 (2013) <http://www.cedr.com/docslib/CISAS_AR_2012.pdf> .
^[52] The author also invited TIO to participate in an interview, but unfortunately TIO declined the invitation for reasons which were explained to the author.
^[53] Review of Alternative Dispute Resolution Schemes Statement, Ofcom, 2012. A full version of the review can be found at http://stakeholders.ofcom.org.uk/binaries/consultations/adr-review-12/statement/statement.pdf
^[54] There can also be concerns on the UK schemes, discussion on that is under 4.2.
^[55] Consumers have longer to lodge complaints with telco Ombudsman, TIO <http://www.tio.com.au/publications/media/consumers-have-longer-to-lodge-complaints-with-telco-ombudsman2> ^[56] Ibid.
^[57] Benchmarks for Industry-based Customer Dispute Resolution Schemes, Minister for Customs and Consumer Affairs, 1997 <http://www.anzoa.com.au/National-Benchmarks-1997.pdf> ^[58] Principle, Benchmark 1, Benchmarks for Industry-based Customer Dispute Resolution Schemes, Minister for Customs and Consumer Affairs, 1997 <http://www.anzoa.com.au/National-Benchmarks-1997.pdf> ^[59] Energy & Water Ombudsman (NSW), Energy and Water Ombudsman Charter,
<http://www.ewon.com.au/ewon/assets/File/Constitution/EWON%20Charter_1July2012.pdf> .
^[60] Energy & Water Ombudsman (Queensland), Energy and Water Ombudsman Act 2006, <https://www.legislation.qld.gov.au/LEGISLTN/CURRENT/E/EnergyOmbA06.pdf>.
^[61] Energy and Water Ombudsman (Victoria), Energy and Water Ombudsman Victoria, <http://www.ewov.com.au/__data/assets/pdf_file/0017/4517/EWOV-Charter_30May2006.pdf> .
^[62] This 2 and 6 year limit is specified in s6.2 of its Terms and References of the Financial Ombudsman Services (FOS), <http://www.fos.org.au/custom/files/docs/terms-of-reference-from-1-january-2010-as-amended-1-january-2014.pdf> .`
^[63] R Baldwin and J Black, Really Responsive Regulation (2007), LSE Law Society and Economy Working Paper 15 (2007), 11.
^[64] Ofcom, Improve access to Alternative Dispute Resolution report (19 May 2009) <http://stakeholders.ofcom.org. uk/binaries/consultations/alt_dis_res/statement/statement.pdf> . Energy & Water Ombudsman (NSW)
^[65] Telecommunications Industry Ombudsman, Consumers have longer to lodge complaints with telco Ombudsman (1 July 2013) <http://www.tio.com.au/publications/media/consumers-have-longer-to-lodge-complaints-with-telco-ombudsman2> .