Digital Economy Bill (HL Bill 102)

A

BILL

[AS AMENDED IN COMMITTEE]

TO

Make provision about electronic communications infrastructure and services;
to provide for restricting access to online pornography; to make provision
about protection of intellectual property in connection with electronic
communications; to make provision about data-sharing; to make provision
about functions of OFCOM in relation to the BBC; to provide for
determination by the BBC of age-related TV licence fee concessions; to make
provision about the regulation of direct marketing; to make other provision
about OFCOM and its functions; to make provision about internet filters; to
make provision about preventing or restricting the use of communication
devices in connection with drug dealing offences; to make provision about
payment systems and securities settlement systems; to make provision about
qualifications in information technology; and for connected purposes.

Be it enacted by the Queen’s most Excellent Majesty, by and with the advice and
consent of the Lords Spiritual and Temporal, and Commons, in this present
Parliament assembled, and by the authority of the same, as follows:—

Part 1 Access to digital services

1 Universal service broadband obligations

(1) The Communications Act 2003 is amended as follows.

(2) 5Section 65 (obligations to be secured by universal service conditions) is
amended as follows.

(3) In subsection (1) omit “(“the universal service order”)”.

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(4) After subsection (2) insert—

(2A) The provision made under subsection (1) is referred to as “the universal
service order”.

(2B) The universal service order may in particular say that broadband
5connections and services must be provided to any extent.

(2C) The universal service order may contain—

(a) guidance about matters relating to the speed or other
characteristics of broadband connections or services that it says
must be provided (as well as or instead of setting out any of
10those characteristics); and

(b) guidance about any other matters relating to those connections
or services.”

(5) In section 66 (designation of universal service provider) after subsection (9)
insert—

(9A) 15In making any regulations under this section, OFCOM must have
regard to any guidance that is contained in the universal service order.”

(6) In section 67(8) (universal service conditions: duty to have regard to guidance)
omit “about matters relating to pricing”.

(7) After section 72 (before the heading “Access-related conditions”) insert—

72A 20Review of universal service order

(1) The Secretary of State may direct OFCOM to review and report to the
Secretary of State on any provision made, or that may be made, by the
universal service order in relation to broadband connections or
services.

(2) 25The Secretary of State must consult OFCOM before giving a direction
under this section.

(3) The Secretary of State must publish a direction under this section.

(4) OFCOM must publish the report made by them to the Secretary of State
of a review under this section.”

(8) 30In section 135(3)(f) (power of OFCOM to require information for purposes of
reviews) for “or 70” substitute “, 70 or 72A”.

2 General conditions: switching communications provider

(1) Section 51(2) of the Communications Act 2003 (conditions which may be set for
protecting interests of end-users) is amended as follows.

(2) 35Omit “and” after paragraph (g).

(3) After paragraph (h) insert—

(i) specify requirements in relation to arrangements that enable an
end-user to change communications provider on request.”

3 Automatic compensation for failure to meet performance standards

40In section 51(2) of the Communications Act 2003 (conditions which may be set

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for protecting interests of end-users), after paragraph (d) insert—

(da) require a communications provider to pay compensation to an
end-user on failing to meet a specified standard or obligation;”.

Part 2 5Digital infrastructure

Electronic communications code

4 The electronic communications code

(1) In the Telecommunications Act 1984 omit Schedule 2 (the telecommunications
code).

(2) 10Before Schedule 4 to the Communications Act 2003 insert Schedule 3A set out
in Schedule 1 to this Act.

(3) Section 106 of the Communications Act 2003 (application of the electronic
communications code) is amended as follows.

(4) In subsection (1) for “the code set out in Schedule 2 to the Telecommunications
15Act 1984 (c 12)1984 (c 12)” substitute “the code set out in Schedule 3A”.

(5) Omit subsection (2).

(6) In subsection (4)(b) for “conduits” substitute “infrastructure”.

(7) In subsection (5)(c) for “conduit system” in each place substitute “system of
infrastructure”.

(8) 20In subsection (6) for “16(3)” substitute “84(7)”.

(9) Omit subsection (7).

(10) Schedules 2 (transitional provisions) and 3 (consequential amendments) have
effect.

5 Power to make transitional provision in connection with the code

(1) 25The Secretary of State may by regulations made by statutory instrument make
transitional, transitory or saving provision in connection with the coming into
force of section 4 and Schedule 1.

(2) Regulations under this section may amend Schedule 2.

(3) A statutory instrument containing regulations under this section—

(a) 30if it includes provision made by virtue of subsection (2), may not be
made unless a draft of the instrument has been laid before and
approved by a resolution of each House of Parliament;

(b) otherwise, is subject to annulment in pursuance of a resolution of either
House of Parliament.

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6 Power to make consequential provision etc in connection with the code

(1) The Secretary of State may by regulations make consequential provision in
connection with any provision made by or under section 4 or this section or
Schedule 1 or 3.

(2) 5Regulations under subsection (1) may amend, repeal, revoke or otherwise
modify the application of any enactment (but, in the case of primary
legislation, only if the primary legislation was passed or made before the end
of the Session in which this Act is passed).

(3) Regulations under this section—

(a) 10are to be made by statutory instrument;

(b) may make different provision for different purposes;

(c) may include incidental, supplementary, consequential, transitional,
transitory or saving provision.

(4) A statutory instrument containing regulations under this section (whether
15alone or with other provisions) which amend, repeal or modify the application
of primary legislation may not be made unless a draft of the instrument has
been laid before and approved by a resolution of each House of Parliament.

(5) Any other statutory instrument containing regulations under this section is
subject to annulment in pursuance of a resolution of either House of
20Parliament.

(6) In this section—

  • “enactment” includes—

    (a)

    an enactment comprised in subordinate legislation within the
    meaning of the Interpretation Act 1978,

    (b)

    25an enactment comprised in, or in an instrument made under, a
    Measure or Act of the National Assembly for Wales,

    (c)

    an enactment comprised in, or in an instrument made under, an
    Act of the Scottish Parliament, and

    (d)

    an enactment comprised in, or in an instrument made under,
    30Northern Ireland legislation;

  • “primary legislation” means—

    (a)

    an Act of Parliament,

    (b)

    a Measure or Act of the National Assembly for Wales,

    (c)

    an Act of the Scottish Parliament, or

    (d)

    35Northern Ireland legislation.

7 Application of the code: protection of the environment

For section 109(2A) of the Communications Act 2003 (under which regulations
that set restrictions and conditions to the application of the electronic
communications code are deemed by subsection (2B) to comply with duties
40under National Parks and other legislation if they comply with the duty to
have regard to the need to protect the environment, but only if they expire
before 6 April 2018) substitute—

(2A) Subsection (2B) applies if the Secretary of State has complied with
subsection (2)(b) in connection with any particular exercise of the
45power to make regulations under this section.”

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Dynamic spectrum access services

8 Regulation of dynamic spectrum access services

(1) After Part 2 of the Wireless Telegraphy Act 2006 insert—

“Part 2A 5 Regulation of dynamic spectrum access services
Registration
53A Registration of providers of dynamic spectrum access services

(1) A person who provides, or proposes to provide, a dynamic spectrum
access service may be registered under this section by OFCOM.

(2) 10An application for registration under this section—

(a) is to be made to OFCOM, and

(b) must contain such information as OFCOM may reasonably
require.

(3) OFCOM must, from time to time as they think fit, publish—

(a) 15the criteria for determining applications under this section, and

(b) information relating to the restrictions and conditions to which
registration under this section may be subject.

(4) The criteria published under subsection (3)(a) may include different
provision for different cases.

(5) 20Registration under this section is to be for such period, and subject to
such restrictions and conditions, as OFCOM think fit.

(6) Any such restrictions and conditions are to be contained in a notice in
writing given to the person registered under this section.

(7) In this Act “dynamic spectrum access service” means a service that
25provides information about—

(a) the availability for use by wireless telegraphy stations and
wireless telegraphy apparatus of frequencies that fall within a
frequency band specified in regulations made by OFCOM, and

(b) the places in which, the power at which, the times when and
30any conditions subject to which such stations and apparatus
may use such frequencies.

53B Revocation and variation of registration

(1) OFCOM may revoke a registration under section 53A, or vary the
restrictions and conditions to which it is subject—

(a) 35by notice in writing given to the person registered under that
section, or

(b) by a general notice applicable to the class to which the person
belongs, published in such way as appears to OFCOM to be
appropriate.

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(2) Where OFCOM propose to revoke or vary a registration, they must
give the person registered under section 53A a notification—

(a) stating the reason for the proposed revocation or variation, and

(b) specifying the period during which the person notified has an
5opportunity to make representations about the proposal.

(3) Nothing in subsection (2) applies to a proposal to revoke or vary a
registration if the proposal is made at the request or with the consent of
the person registered under section 53A.

(4) Nothing in this section applies in relation to—

(a) 10a notification given under section 53E, or

(b) a decision given under section 53G.

53C Register of providers of dynamic spectrum access services

(1) OFCOM must establish and maintain a register for the purposes of this
Part.

(2) 15The register is to contain—

(a) the names of the persons registered under section 53A, and

(b) such other information relating to the registration of those
persons as OFCOM consider appropriate.

(3) OFCOM may make available to users or prospective users of dynamic
20spectrum access services such information contained in the register as
they consider appropriate.

Fees
53D Fees for registration etc

(1) Regulations made by OFCOM may provide for OFCOM to charge
25fees—

(a) for registering a person under section 53A;

(b) for the continuation in force of such a registration;

(c) for the variation or revocation of such a registration;

(d) for anything done by OFCOM in connection with facilitating
30the service provided by a person registered under section 53A.

(2) Subsection (1)(d) does not include anything for which OFCOM may
charge under any other enactment.

(3) The fees—

(a) are to be determined by or in accordance with the regulations,
35and

(b) are to be payable by the person who is to be, is or has been
registered under section 53A.

(4) The regulations may—

(a) confer exemptions in particular cases, and

(b) 40provide for sums paid to be refunded, in whole or in part, in
such cases as may be specified in the regulations or in such cases
as OFCOM think fit.

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(5) Where OFCOM register a person in circumstances in which sums will
or may subsequently become payable under the regulations, OFCOM
may require such security to be given, by way of deposit or otherwise,
for the payment of those sums as they think fit.

(6) 5A sum which is required to be paid to OFCOM by virtue of the
regulations must be paid to OFCOM as soon as it becomes payable in
accordance with the regulations and, if it is not paid, is recoverable by
them accordingly.

Enforcement
53E 10Notification of contravention of registration restrictions or conditions

(1) Where OFCOM determine that there are reasonable grounds for
believing that a person registered under section 53A is contravening, or
has contravened, the restrictions or conditions subject to which the
person is registered they may give that person a notification under this
15section.

(2) A notification under this section is one which—

(a) sets out the determination made by OFCOM,

(b) specifies the restriction or condition and contravention in
respect of which that determination has been made,

(c) 20specifies the period during which the person notified has an
opportunity to make representations,

(d) specifies the steps that OFCOM think should be taken by the
person in order to—

(i) comply with the restriction or condition;

(ii) 25remedy the consequences of the contravention,

(e) if OFCOM are minded to suspend or revoke the person’s
registration, contains a statement to that effect, and

(f) specifies any penalty which OFCOM are minded to impose in
accordance with section 53F.

(3) 30A notification under this section—

(a) may be given in respect of more than one contravention, and

(b) if it is given in respect of a continuing contravention, may be
given in respect of any period during which the contravention
has continued.

(4) 35Where a notification under this section has been given to a person in
respect of a contravention of a restriction or condition, OFCOM may
give a further notification in respect of the same contravention of that
restriction or condition if, and only if—

(a) the contravention is one occurring after the time of the giving of
40the earlier notification,

(b) the contravention is a continuing contravention and the
subsequent notification is in respect of so much of a period as
falls after a period to which the earlier notification relates, or

(c) the earlier notification has been withdrawn without a penalty
45having been imposed, or other action taken, in respect of the
notified contravention.

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53F Penalties under section 53E

(1) This section applies where a person is given a notification under section
53E that specifies a proposed penalty.

(2) Where the notification relates to more than one contravention, a
5separate penalty may be specified in respect of each contravention.

(3) Where the notification relates to a continuing contravention, no more
than one penalty may be specified in respect of the period of
contravention specified in the notification.

(4) But, in relation to a continuing contravention, a penalty may be
10specified in respect of each day on which the contravention continues
after—

(a) the giving of a confirmation decision under section 53G which
requires immediate action, or

(b) the expiry of any period specified in the confirmation decision
15for complying with a requirement so specified.

(5) The amount of a penalty specified under subsection (4) is to be such
amount, not exceeding £20,000 per day, as OFCOM think—

(a) appropriate, and

(b) proportionate to the contravention in respect of which it is
20imposed.

(6) The amount of any other penalty specified under this section is to be
such amount, not exceeding 10% of the relevant amount of gross
revenue, as OFCOM think—

(a) appropriate, and

(b) 25proportionate to the contravention in respect of which it is
imposed.

53G Enforcement of notification under section 53E

(1) This section applies where—

(a) a person has been given a notification under section 53E,

(b) 30OFCOM have allowed the person an opportunity to make
representations about the matters notified, and

(c) the period allowed for the making of representations has
expired.

(2) OFCOM may—

(a) 35give the person a decision (a “confirmation decision”)
confirming the imposition of requirements on the person, or the
suspension or revocation of the person’s registration, or both, in
accordance with the notification under section 53E, or

(b) inform the person that they are satisfied with the person’s
40representations and that no further action will be taken.

(3) OFCOM may not give a confirmation decision to a person unless, after
considering any representations, they are satisfied that the person has,
in one or more of the respects notified, been in contravention of a
restriction or condition specified in the notification under section 53E.

(4) 45A confirmation decision—

(a) must be given to the person without delay,

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(b) must include reasons for the decision,

(c) may require immediate action by the person to comply with
requirements of a kind mentioned in section 53E(2)(d), or may
specify a period within which the person must comply with
5those requirements,

(d) may require the person to pay—

(i) the penalty specified in the notification under section
53E, or

(ii) such lesser penalty as OFCOM consider appropriate in
10the light of the person’s representations or steps taken
by the person to comply with the condition or restriction
or remedy the consequences of the contravention, and

(e) may specify the period within which any such penalty is to be
paid.

(5) 15It is the duty of the person to comply with any requirement imposed by
a confirmation decision.

(6) That duty is enforceable in civil proceedings by OFCOM

(a) for an injunction,

(b) for specific performance of a statutory duty under section 45 of
20the Court of Session Act 1988, or

(c) for any other appropriate remedy or relief.

(7) A penalty imposed by a confirmation decision—

(a) must be paid to OFCOM, and

(b) if not paid within the period specified by them, is to be
25recoverable by them accordingly.

53H Meaning of “relevant amount of gross revenue”

(1) The relevant amount of gross revenue for the purposes of section 53F,
in relation to a penalty imposed on a person, is—

(a) where the last accounting period of that person which falls
30before the contravention was a period of 12 months, the
relevant part of the person’s gross revenue for that period, and

(b) in any other case, the amount which, by making any
appropriate apportionments or other adjustments of the
relevant part of the person’s gross revenue for the accounting
35period or periods mentioned in subsection (2), is computed to
be the amount representing the annual rate for the relevant part
of the person’s gross revenue.

(2) The accounting period or periods referred to in subsection (1) are—

(a) every accounting period of the person to end within the period
40of 12 months immediately preceding the contravention, and

(b) if there is no such accounting period, the accounting period of
the person which is current at the time of the contravention.

(3) A reference to the relevant part of a person’s gross revenue, in relation
to a contravention of the restrictions or conditions subject to which the
45person is registered under section 53A, is a reference to so much of the
person’s gross revenue as is attributable to the provision of the
dynamic spectrum access service to which the contravention relates.