Internet dumping burning unsuspecting consumers

What are the rules?

There are a couple of factors adding the the difficulties faced by legislators when it comes to combatting Internet dumping practices.

Governments often come under fire for attempting to regulate the Internet, as it's perceived as both unworkable and a form of censorship. And while other industries have been around for decades, allowing ample time to sort out the nuances of regulations, the Internet is still effectively less than a decade old.

Premium number services which provide access to the 190 numbers are regulated by the Telecommunications (Consumer Protection and Service Standards) Act 1999, which required telephone sex lines to preregister potential customers and provide them with an access PIN.

According to Robbie Swan, media director of the Eros Foundation, the regulations set out in 1999 resulted in a collapse of the industry. Before the legislation 1.4 million calls per month were made to ten or twenty service providers, and just six months after it was brought in only 35 people had registered with the scheme. He claims the scheme removed an essential part of the service, that of privacy.

However, the legislation does not cover 190 numbers accessed over the Internet, and leaving ample room for service providers to take advantage of what is essentially a legal loophole and claw back some of their revenue. What's more the Internet provides the added advantage that consumers don't have to physically dial in the numbers.

Teresa Corbin from the Consumer Telecommunications Network believes there are massive flaws with the laws governing this phenomenon. "Some gaps are so big you can drive a tank through them," she said.

Corbin believes the largest problem is the fact the Internet is such a grey area in the law, as it is governed by a combination of State and Federal laws. There has never been a court case against the companies that provide these services in Australia, so legal precedence has yet to be established.

The Government is slowly moving to curb the practice of Internet Dumping. In May this year Senator Alston, the Minister for Information Technology, Communications and the Arts, released for public comment draft regulations proposing 190 numbers only be accessible through a PIN, which was designed to close the loopholes in the legislation.

However, by the time the legislation was released in November, the proposals had changed to a monthly price cap on the charges from 190 services, as well as moves to enshrine the current Code of Practice that regulates the industry into the Telecommunications Act.

Adam Rowbottom, the president of the Telephone Service Providers Association of Australia, told ZDNet Australia   the Code was one of the best in the world for premium rate services, and didn't need the extra strength of being registered in the telecommunications act.

"It's interesting to look at regeristing a code of practice when the telecommunication act and Alston's own thoughts are for self regulation," said Rowbottom. The Australian Communications Authority, the government body which would would enforce such regulations, said it is still waiting on an official direction from the minister's office.

There are several problems the government faces when attempting to regulate Internet Dumping. The first is the ever-changing nature of the Internet, allowing sites to quickly remove or modify material to comply with the law. Content is often based offshore, making regulation of the content and messages very difficult. In addition, pop-up messages are sometimes so brief they are practically impossible to read, yet at the same time serve to satisfy basic legal requirements.

While the move by Senator Alston has focussed some attention on the phenomenon, Australia is still a long way from solving the problem. The concern remains that any new legislation will contain further loopholes, allowing these companies to remain one step ahead of the law, and continuing to leave consumers out of pocket.