Digital Economy Bill (HL Bill 122)

A

BILL

[AS AMENDED ON REPORT]

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 in
connection with section 68 of the Telecommunications Act 1984; 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 confer power to create an
offence of breaching limits on ticket sales; to make provision about the
payment of charges to the Information Commissioner; 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 must specify that the target for broadband
5connections and services to be provided before 2020 must have—

(a) speeds of 2 gigabits or more;

(b) fibre to the premises (FTTP) as a minimum standard;

(c) appropriate measures to ensure that internet speed levels are
not affected by high contention ratios;

(d) 10appropriate measures to ensure service providers run low
latency networks.

(2C) The universal service order must specify as soon as reasonably
practicable that, by 2020, the following will be available in every
household in the United Kingdom—

(a) 15download speeds of 30 megabits per second;

(b) upload speeds of 6 megabits per second;

(c) fast response times;

(d) committed information rates of 10 megabits per second;

(e) an unlimited usage cap.

(2D) 20In meeting the obligations set out in subsection (1), internet service
providers have a duty to ensure that their networks offer at least the
minimum standards specified in subsection (2C) to every household in
areas of low population density, before deploying their networks in
urban areas.

(2E) 25The Secretary of State must ensure that—

(a) the premises of small and medium-sized enterprises are
prioritised in the roll-out of the universal service broadband
obligation;

(b) roll-out of universal service broadband obligations is delivered
30on a fair and competitive basis.

(2F) The universal service order shall, in particular, say that mobile network
coverage must be provided to the whole of the United Kingdom.

(2G) The universal service order may contain—

(a) guidance about matters relating to the speed or other
35characteristics of broadband connections or services that it says
must be provided (as well as or instead of setting out any of
those characteristics); and

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

(5) 40In section 66 (designation of universal service provider) after subsection (9)
insert—

(9A) In 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)
45omit “about matters relating to pricing”.

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

72A Review 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
5universal service order in relation to broadband connections or
services.

(2) The 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) 10OFCOM must publish the report made by them to the Secretary of State
of a review under this section.”

(8) In 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) 15Section 51(2) of the Communications Act 2003 (conditions which may be set for
protecting interests of end-users) is amended as follows.

(2) Omit “and” after paragraph (g).

(3) After paragraph (h) insert—

(i) specify requirements in relation to arrangements that enable an
20end-user to change communications provider on request.”

3 Bill limits for mobile phone contracts

(1) A telecommunications service provider supplying a contract relating to a
handheld mobile telephone must, at the time of entering into such a contract—

(a) allow the end-user the opportunity to place a financial cap on the
25monthly bill under that contract;

(b) allow the end-user to switch (at no extra charge) to another provider,
which meets the specified standards or obligation as provided for in
section 3, or to deem the contract to have been terminated by a
consistent breach of the standards or obligation as provided for in
30section 3;

(c) allow the end-user to switch mobile providers according to rules set out
by OFCOM in accordance with the following principles—

(i) that switching must be free to the consumer, unless the
consumer is aware of and has consented to fair and reasonable
35restrictions and charges to do so;

(ii) that the switching process itself must be quick, and on an
agreed date;

(iii) that consumers must have access to their consumption or
transaction data, and this must be in a format that can be easily
40reused and they must be able to authorise third parties such as
comparison sites to access their data to help them to switch;

(iv) that sites and tools providing comparisons to consumers that
receive payments from suppliers must make clear where the
payments affect the presentation of results; and

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(v) that there must be an effective process for consumers to receive
redress if there are any problems with the service.

(2) A telecommunications service provider under subsection (1) must not begin to
supply a contracted service to an end-user unless the end-user has either—

(a) 5requested the monthly cap be put in place and agreed the amount of
that cap, or

(b) decided, with the decision recorded on a durable medium, not to put a
monthly cap in place.

(3) An end-user may, after the start of the contracted service—

(a) 10contact the service provider to require a cap to be put in place and agree
the amount of that cap, or

(b) require a cap to be removed, with the requirement recorded on a
durable medium.

(4) The end-user should bear no cost for the supply of any service above the cap if
15the provider has—

(a) failed to impose a cap agreed under subsection (2)(a) or (3)(a); or

(b) removed the cap without the end-user’s express consent, provided on
a durable medium as required under subsection (2)(b) or (3)(b).

4 Automatic compensation for failure to meet performance standards

20In section 51(2) of the Communications Act 2003 (conditions which may be set
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 25Digital infrastructure

Electronic communications code

5 The electronic communications code

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

(2) 30Before 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
35Act 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”.

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(8) In subsection (6) for “16(3)” substitute “85(7)”.

(9) Omit subsection (7).

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

6 5Power to make transitional provision in connection with the code

(1) The 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 5 and Schedule 1.

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

(3) 10A statutory instrument containing regulations under this section—

(a) if 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
15House of Parliament.

7 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 5 or this section or
Schedule 1 or 3.

(2) 20Regulations 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) 25are 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
30alone 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
35Parliament.

(6) In this section—

  • “enactment” includes—

    (a)

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

    (b)

    40an 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

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    (d)

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

  • “primary legislation” means—

    (a)

    an Act of Parliament,

    (b)

    5a Measure or Act of the National Assembly for Wales,

    (c)

    an Act of the Scottish Parliament, or

    (d)

    Northern Ireland legislation.

8 Application of the code: protection of the environment

For section 109(2A) of the Communications Act 2003 (under which regulations
10that set restrictions and conditions to the application of the electronic
communications code are deemed by subsection (2B) to comply with duties
under 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) 15Subsection (2B) applies if the Secretary of State has complied with
subsection (2)(b) in connection with any particular exercise of the
power to make regulations under this section.”

Dynamic spectrum access services

9 Regulation of dynamic spectrum access services

(1) 20After Part 2 of the Wireless Telegraphy Act 2006 insert—

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

(1) 25A person who provides, or proposes to provide, a dynamic spectrum
access service may be registered under this section by OFCOM.

(2) An application for registration under this section—

(a) is to be made to OFCOM, and

(b) must contain such information as OFCOM may reasonably
30require.

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

(a) the 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) 35The criteria published under subsection (3)(a) may include different
provision for different cases.

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

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(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
provides information about—

(a) 5the 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
any conditions subject to which such stations and apparatus
10may 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) by notice in writing given to the person registered under that
15section, 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.

(2) Where OFCOM propose to revoke or vary a registration, they must
20give 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
opportunity to make representations about the proposal.

(3) Nothing in subsection (2) applies to a proposal to revoke or vary a
25registration 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) a notification given under section 53E, or

(b) a decision given under section 53G.

53C 30Register of providers of dynamic spectrum access services

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

(2) The register is to contain—

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

(b) 35such 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
spectrum access services such information contained in the register as
they consider appropriate.

40Fees
53D Fees for registration etc

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

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

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(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
the service provided by a person registered under section 53A.

(2) 5Subsection (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,
and

(b) 10are 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) provide for sums paid to be refunded, in whole or in part, in
15such cases as may be specified in the regulations or in such cases
as OFCOM think fit.

(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,
20for the payment of those sums as they think fit.

(6) A 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.

25Enforcement
53E Notification 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
30person is registered they may give that person a notification under this
section.

(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
35respect of which that determination has been made,

(c) specifies 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) 40comply with the restriction or condition;

(ii) remedy 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
45accordance with section 53F.

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(3) A 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
5has continued.

(4) Where 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) 10the contravention is one occurring after the time of the giving of
the 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) 15the earlier notification has been withdrawn without a penalty
having been imposed, or other action taken, in respect of the
notified contravention.

53F Penalties under section 53E

(1) This section applies where a person is given a notification under section
2053E that specifies a proposed penalty.

(2) Where the notification relates to more than one contravention, a
separate 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
25contravention specified in the notification.

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

(a) the giving of a confirmation decision under section 53G which
30requires immediate action, or

(b) the expiry of any period specified in the confirmation decision
for 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) 35appropriate, and

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

(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
40revenue, as OFCOM think—

(a) appropriate, and

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

53G Enforcement of notification under section 53E

(1) 45This section applies where—

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