THE COMPETITION TRIBUNAL IN THE MATTER of the Competition Act, R.S.C. 1985. c. C-34, as amended; AND IN THE MATTER of an inquiry commenced pursuant to subparagraph 10(l)(b)(ii) of the Competition Act with respect to certain marketing practices of the Canadian Wireless Telecommunications Association under paragraph 74.01(l)(a) of the Competition Act;
AND IN THE MATTER of a Consent Agreement pursuant to section 74.12 of the Competition Act.
B E T W E E N : COMMISSIONER OF COMPETITION Applicant - and - THE CANADIAN WIRELESS TELECOMMUNICATIONS ASSOCIATION Respondent
CONSENT AGREEMENT WHEREAS the Commissioner of Competition (the “Commissioner”) is responsible for the administration and enforcement of the Competition Act (the “Act”);
AND WHEREAS the Canadian Wireless Telecommunications Association (the “CWTA”, also referred to as “the Respondent”) is a not-for-profit corporation organised pursuant to the laws of Canada that is located in Ottawa, Ontario. The CWTA is an industry association that represents the interests of Canadian wireless companies;
AND WHEREAS the CWTA established and managed for the Canadian wireless industry the process and procedures by which Common Short Codes are made available to providers of Premium Text Messaging and Rich Content Services through the Common Short Code Council;
AND WHEREAS on April 24, 2012, the Commissioner commenced an inquiry pursuant to subparagraph 10(l)(b)(ii) of the Act into certain marketing practices regarding Premium Text Messaging and Rich Content Services;
AND WHEREAS certain third party businesses, referred to as content providers or aggregators, offer Premium Text Messaging and Rich Content Services to consumers, such as texts providing news, horoscopes, advice, alerts, ringtones and trivia, and charge consumers at rates in addition to standard text messaging rates for these services;
- 2 - AND WHEREAS on September 14, 2012, the Commissioner commenced an action in the Ontario Superior Court of Justice by Statement of Claim against CWTA and other parties, which claim was amended on January 17, 2014 (the “Action”);
AND WHEREAS the Commissioner has concluded that during the Relevant Periods (as defined below), the Respondent engaged in conduct contrary to paragraph 74.01(1)(a) of the Act, by promoting its or its members’ business interests in Premium Text Messaging and Rich Content Services by making, or permitting to be made, materially false or misleading representations to the public;
AND WHEREAS IT IS AGREED AND UNDERSTOOD that for the purposes of this Agreement only, including execution, registration, enforcement, variation or rescission of this Agreement, the Respondent does not contest the Commissioner’s conclusions but nothing in this Agreement shall be taken as an admission or acceptance by the Respondent of any facts, wrongdoing, submissions, legal argument or conclusions for any other purpose nor shall it derogate from any rights or defences of the Respondent against third parties including any defences available under the Act;
AND WHEREAS the Commissioner and the Respondent are satisfied that this matter can be resolved with the registration of this Agreement;
AND WHEREAS the Respondent took steps to bring problems regarding some Premium Text Messaging and Rich Content Services providers to the attention of the Commissioner prior to the commencement of the Commissioner’s inquiry;
AND WHEREAS the Respondent has informed the Commissioner that during the Relevant Period, the Respondent undertook a number of voluntary and pro-active steps to address the conduct at issue;
AND WHEREAS in particular but without limitation, the Respondent has informed the Commissioner that currently all of its member wireless companies have voluntarily ceased all involvement in Premium Text Messaging and Rich Content Services with the exception of certain voting and mobile commerce services (m-Payments, m-Banking, m-Offers and m-Ticketing as described in the CWTA’s current Short Code Application Guidelines) and services relating to charitable donations;
AND WHEREAS the Respondent has informed the Commissioner that complaints related to Premium Text Messaging and Rich Content Services programs have been virtually eliminated;
AND WHEREAS the Commissioner has reached Consent Agreements with Bell, Telus and Rogers, the largest three wireless companies engaged in the business of providing Premium Text Messaging and Rich Content Services, which Agreements include substantial refunds payable for consumers affected by the conduct at issue;
AND WHEREAS these Consent Agreements have also substantially resolved the Commissioner’s concerns with respect to the conduct, as they prohibit Bell, Rogers and Telus from imposing charges on a Customer’s wireless accounts with respect to the Product, unless such charges have been approved through an affirmative act or statement of the Customer directly to the relevant wireless carrier;
- 3 - AND WHEREAS the Commissioner has agreed to more favourable terms in this Agreement than would otherwise be the case because of some of the factors set out herein;
NOW THEREFORE, in order to resolve the Commissioner’s concerns, the Parties hereby agree as follows:
I. INTERPRETATION 1. For the purpose of the Agreement, the following definitions shall apply: (a) “Act” means the Competition Act, R.S.C. 1985, c. C-34, as amended; (b) “Agreement” means this Consent Agreement, including the appendices hereto, and references to an “Article”, “Section”, “Part”, “Paragraph” or “Appendix” are, unless otherwise indicated, references to a section, part, paragraph or appendix of or to this Agreement;
(c) “Commissioner” means the Commissioner of Competition appointed pursuant to section 7 of the Act;
(d) “Common Short Code” means the four (4) to six (6) digit numeric identifier leased from the CWTA and used by wireless companies to provide third parties with access to the wireless companies’ billing platforms to charge for Premium Text Messaging and Rich Content Services;
(e) “Customer” means a person who has or had an agreement with a wireless company to receive wireless services;
(f) “Days” means calendar days; (g) “Notice” has the meaning set out in paragraph 2 of this Agreement; (h) “Parties” means the Commissioner and the Respondent collectively, and “Party” means any one of them;
(i) “Product” and “Premium Text Messaging and Rich Content Services” mean text messaging services that are: (i) charged by wireless companies to Customers through their billing system at rates in excess of standard text messaging rates; (ii) routed using a Common Short Code; and (iii) offer a chance to win a contest or provide news, advice, alerts, trivia, quotations or horoscopes, or other goods or services, including ringtones, wallpapers, other audio or visual content and programs or applications designed for operation on wireless communications devices, but does not include donations to a registered charity or voting and mobile commerce services (m-Payments, m-Banking, m-Offers and m-Ticketing as described in the CWTA’s current Short Code Application Guidelines);
(j) “Relevant Period” means between January 1, 2011 and February 25, 2016; (k) “Respondent” includes CWTA and its successors and assigns;
- 4 - (l) “Respondent’s Personnel” means all current and future Respondent employees and senior management who are materially involved in the formulation and/or the implementation and operation of Common Short Codes and Premium Text Messaging and Rich Content Services; and
(m) “Tribunal” means the Competition Tribunal as established by the Competition Tribunal Act Canada, R.S.C. 1985, c. 19 (2nd Supp.), as amended.
II. PUBLIC NOTICE TO AFFECTED CUSTOMERS 2. The Respondent shall publish, in both French and English, the Notice in Appendix “A” of this Agreement in accordance with the terms and conditions set out in Appendix “B” of this Agreement.
III. CORPORATE COMPLIANCE PROGRAM 3. Within sixty (60) Days of the date of the registration of this Agreement, the Respondent shall, as necessary, enhance and thereafter maintain its Corporate Compliance Program (“Compliance Program”) with a specific focus on “billing on behalf of” practices and the Act generally. The Compliance Program shall be framed in a manner consistent with the Commissioner's bulletin titled “Corporate Compliance Programs”, as published (as of the date of execution of this Agreement) on the Competition Bureau’s website at www.competitionbureau.gc.ca.
IV. CONSUMER AWARENESS CAMPAIGN 4. Within one hundred and twenty (120) Days of the date of the registration of this Agreement, the Respondent will commence offering a Consumer Awareness Campaign to educate consumers about how charges can be incurred on wireless devices and what steps consumers can take to avoid unwanted charges that would include safety tips for consumers purchasing online. The campaign will include an educational notice on a portion of the Respondent’s websites (including www.cwta.ca and www.txt.ca), setting out, for example, methods by which a consumer can incur charges on the consumer's wireless bill and the opt-out methods available. The educational notice will be maintained and available for at least one year from the date of the implementation of the Consumer Awareness Campaign.
V. COMPLIANCE REPORTING AND MONITORING 5. The Respondent shall provide the Commissioner or the Commissioner’s authorized representative:
(a) within twenty one (21) Days after the date of the registration of this Agreement, written confirmation that all Respondent Personnel have received a copy of this Agreement, as required by paragraph 7;
- 5 - (b) within one hundred and fifty (150) Days after the date of the registration of this Agreement, a written summary of the steps taken to implement the Consumer Awareness Campaign required in paragraph 4.
6. The Respondent shall provide the Commissioner or the Commissioner’s authorized representative, within thirty (30) Days following receipt of a written request from the Commissioner or his authorized representative, such information, in such form as the Commissioner requests, for the purposes of monitoring compliance with this Agreement.
VI. GENERAL 7. (1) The Respondent shall provide a copy of this Agreement to all Respondent Personnel within fourteen (14) days after the date of registration of this Agreement.
(2) All future Respondent Personnel shall be provided a copy of this Agreement within fourteen (14) Days after his or her assumption of responsibilities for Premium Text Messaging and Rich Content Services.
(3) Within fourteen (14) Days after providing a copy of this Agreement to each Respondent Personnel, the Respondent shall secure from each such person a signed and dated statement acknowledging that he or she read and understood this Agreement.
8. Notices, reports and other communications required or permitted pursuant to any of the terms of this Agreement shall be in writing and shall be considered to be given if dispatched by personal delivery, registered mail or facsimile transmission to the Parties at the following addresses:
(a) The Commissioner Commissioner of Competition Competition Bureau Place du Portage, Phase 1 50 Victoria Street, 21st Floor Gatineau QC KIA OC9
Attention: Senior Deputy Commissioner of Competition (Cartels and Deceptive Marketing Practices Branch) Telephone: 819-997-1208 Facsimile: 819-953-3835
- 6 - With a copy to: Executive Director, Competition Bureau Legal Services Department of Justice Place du Portage, Phase 1 50 Victoria Street, 22nd Floor Gatineau QC KIA OC9
Telephone: 819-994-7714 Facsimile: 819-953-9267
(b) The Respondent Bernard Lord President & CEO Canadian Wireless Telecommunications Association 300-80 Elgin Street Ottawa, ON K1P 6R2
Telephone: 613-233-4888 Facsimile: 613-233-2032
9. This Agreement may be executed in two or more counterparts, each of which shall be an original instrument, and all of which taken together shall constitute one and the same instrument. In the event of any discrepancy between the English and French versions of this Agreement, the English version shall prevail.
10. The computation of time periods contemplated by this Agreement shall be in accordance with the Interpretation Act, R.S.C. 1985, c. 1-21. For the purpose of this Agreement, the definition of “holiday” in the Interpretation Act shall include Saturday. For the purpose of determining time periods, the date of this Agreement is the last date on which it is executed by a Party.
11. The Parties consent to the immediate registration of this Agreement with the Tribunal. 12. The Commissioner and CWTA shall, as soon as practicable after the registration of this Agreement, apply to the Ontario Superior Court of Justice to dismiss the Action as against CWTA on a without costs basis, and, if the litigation is not otherwise settled in its totality, shall apply and request consent of the other defendants to remove related references to CWTA in the pleadings within thirty (30) days of the registration of this Consent Agreement, which Agreement, upon registration, shall have the same force and effect as if it was an order of the Tribunal.
13. This Agreement shall be binding upon the Respondent as defined herein for a period of ten (10) years following the date of registration of this Agreement.
14. In the event of a dispute as to the interpretation or application of this Agreement, any of the Parties shall be at liberty to apply to the Tribunal for an order or directions. The Parties agree that the Tribunal has jurisdiction to make such order as is required to give effect to this Agreement.
- 7 - The undersigned hereby agree to the filing of this Agreement with the Tribunal for registration. DATED at Ottawa, in the Province of Ontario this 25th day of April, 2016. THE CANADIAN WIRELESS TELECOMMUNICATIONS ASSOCIATION
For: “Bernard Lord” Bernard Lord President & CEO
DATED at Gatineau, in the Province of Quebec, this 26 th day of May, 2016. COMMISSIONER OF COMPETITION For: “John Pecman” John Pecman Commissioner of Competition
APPENDIX “A” NOTICE SETTLEMENT REACHED IN PREMIUM TEXT MESSAGING SERVICES LITIGATION
[DATE] The Canadian Wireless Telecommunications Association (the “CWTA”) and the Commissioner of Competition have reached a resolution to ongoing litigation concerning third party charges incurred by consumers of some Wireless Carriers’ for Premium Text Messaging and Rich Content Services. This resolution is reflected in a Consent Agreement (the “Agreement”), a copy of which can be accessed [link to Competition Tribunal website].
If you have questions related to this Agreement, please contact the CWTA at [ add email address ].
APPENDIX “B” TERMS AND CONDITIONS OF THE NOTICE 1. The Respondent shall publish or display the Notice in Appendix “A” of this Agreement on at least the following website(s): www.cwta.ca www.txt.ca
2. The Respondent shall also publish the Notice in Appendix “A” of this Agreement via at least its Twitter account;
3. The Respondent shall post the Notice in accordance with para. 2 of the Agreement, and shall maintain the Notice for a period of at least sixty (60) days from the date of registration of the Agreement with the Tribunal; and
4. The Notice shall be visibly located on any linked page. The title of the Notice shall be capitalized and appear in no less than 14 point bold font unembellished print, and the text of the Notice shall appear in no less than 12 point font unembellished print.