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Mercury Telecommunications feels Ofcom's wrath

But complains of impossible operating conditions

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Mercury Telecommunications Ltd has been slapped down by Ofcom for incorrectly invoicing a customer in a dispute investigation run by Otelo. The process has left the company not only kicked out of Otelo (the investigating body), but unable to trade legally.

Under the Communications Act 2003, all telecommunications companies are required to be members of an independent dispute resolution scheme (DRB), by joining up with either Otelo and Cisas.

Customers in dispute with their telecommunications provider can complain to the organisation of which their provider is a member without being charged.

Assuming the dispute is three months old and the company complaints procedure has been followed, the DRB gets involved and issues an invoice to the telecommunications company for the cost of the investigation - a set fee which is agreed by members each year. This fee is payable regardless of the validity of the complaint.

Mercury's contention is that if a customer owes less than the fee (a figure which isn't officially public, but is widely known) they might as well file a spurious complaint on the basis that the telecommunications company is unlikely to let the complaint last three months and incur the greater cost of an investigation.

Mercury issued an invoice to a complainant to recover its costs in what it considered a case of this type. But that is clearly in breach of the Act.

As a result of this dispute, Mercury was kicked out of Otelo but, as it is legally required to be within a DRB, it applied for membership of Cisas.

Unfortunately for Mercury, Cisas and Otelo have an agreement to inform each other of companies expelled from either scheme, and a policy of not granting membership to such companies - leaving Mercury with nowhere to go.

Ofcom has now ruled that Mercury will have to concede to everything Otelo has claimed, and if it wants to continue trading it's going to have to pay up and play nicely.

Mercury director Ian Burrow says the company is a victim of circumstance and at the mercy of a closed society of regulators and dispute resolution schemes which leaves small operators in an untenable position.

With websites now providing information on how to make claims against telecommunications companies, and how to win those claims though careful manipulation of the rules, more people might be tempted to get what they can - making life very difficult for the small trader with the rules standing as they are. ®

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