ICO fines, Brexit legislation, CMA-led sweep of global websites, European Commission consultation on digital levy and more in this week’s round-up of UK and EU techlaw developments.
Framework for the Free Flow of Non-Personal Data (Revocation) (EU Exit) Regulations 2021 made
The Framework for the Free Flow of Non-Personal Data (Revocation) (EU Exit) Regulations 2021 SI 2021/83 have been made. The Regulations are made under section 8(1) of the European Union (Withdrawal) Act 2018 to address failures of retained EU law to operate effectively and other deficiencies (in particular under section 8(2)(d)) arising from the withdrawal of the UK from the EU. Regulation 1 covers citation and commencement. Regulation 2 revokes Regulation (EU) 2018/1807 of the European Parliament and of the Council, which establishes a framework for the free flow of non-personal data in the European Union, as it forms part of domestic law by virtue of section 3 of the Act. The Regulations come into force on 17 February 2021.
ICO issues fines totalling £480,000 to companies making nuisance calls
The ICO has issued fines totalling £480,000 to four separate companies for making unlawful calls to numbers registered with the Telephone Preference Service. The fines varied from £90,000 to £180,000. The four companies were found to have made 2.4million illegal calls between them, resulting in over 250 complaints to the ICO and the TPS. The first company did not conduct any due diligence on its data supplier and the consents it was relying on were insufficient. The second was inconsistent with its evidence, was not able to show any due diligence it had conducted and could not provide any evidence of a TPS licence. A third was responsible for making 1,103,292 nuisance calls, which all related to washing machine warranties. It had initially advised the ICO that its “opt in” data was obtained from 12 third party suppliers and it did not screen against the TPS register. It was subsequently found that all the data was collected via telephone marketing surveys. The final company made 188,665 calls of which 126,019 were to TPS registered users and generated 29 complaints. The ICO found a level of naivety on its part with its business practices and that it was relying on “good faith” alone with its purchased data.
Draft Electronic Communications (Security Measures) Regulations published
The Telecommunications (Security) Bill, as introduced to Parliament on 24 November 2020, will create new powers for the Secretary of State to make regulations requiring the UK’s providers of public electronic communications networks and services to take specified security measures to protect their networks and services (further to the strengthened overarching security duties set out in the Bill). All aspects of the Telecommunications (Security) Bill, including the powers to issue regulations, are subject to Parliamentary approval. The government has developed an early draft of a statutory instrument containing regulations that may be made using new powers. The draft has been made available to illustrate how the government may use these new powers and to enable early engagement with providers, during the passage of the bill. The draft statutory instrument is at an early stage and is subject to further change, including: changes that might be made to the Bill during its passage (as it reflects the powers contained in the Bill on its introduction); and/or changes based on further engagement with and feedback from providers.
Draft Audiovisual Media Services (Amendment) Regulations 2021 published
The UK government has published draft Audiovisual Media Services (Amendment) Regulations 2021. They are made under section 8 of the European Union (Withdrawal) Act 2018 to address the remaining deficiencies arising in the operation of domestic law which transposes the revised Audiovisual Media Services Directive, Directive 2010/13/EU as a result of the UK’s exit from the EU. The regulations will address the remaining deficiencies that were not addressed in the Audiovisual Media Services (EU Exit) (Amendment) Regulations 2020 (SI 2020/1536).
CMA coordinates global sweep of websites’ “green claims”
The International Consumer Protection Enforcement Network (ICPEN) hosts an annual sweep of websites, which gives consumer authorities across the world the opportunity to target fraudulent, deceptive or unfair conduct online. The CMA and The Netherlands Authority for Consumers and Markets (ACM) led the latest sweep, focusing on misleading environmental claims for the first time. This comes as the CMA’s own investigation into misleading environmental claims is ongoing, to better understand the effect of green marketing on consumers. 500 websites were swept. Members found that 4 in 10 of these websites appeared to be using tactics that could be considered misleading and therefore potentially break consumer law. These included: vague claims and unclear language including terms such as ‘eco’ or ‘sustainable’ or reference to ‘natural products’ without adequate explanation or evidence of the claims; own brand eco logos and labels not associated with an accredited organisation; and hiding or omitting certain information, such as a product’s pollution levels, to appear more eco-friendly. The CMA will publish guidance for UK businesses later this year to help them support the transition to a low carbon economy whilst ensuring that consumers get the information they need. At this early stage, ICPEN members have not reached a view as to whether or not consumer protection law has been broken. However, if the CMA finds evidence that businesses are misleading UK consumers, it will take appropriate action.
European Commission consults on digital levy
The European Commission is consulting on the adoption of a proposal for a Directive on a digital levy. Technological advancements and digitalisation are profoundly changing the way we work, do business, how people travel, communicate and relate. Against this backdrop, the EU says that it needs a modern, stable regulatory and tax framework to appropriately address the developments and challenges of the digital economy. The new initiative aims to help address the issue of fair taxation related to the digitalisation of the economy and, at the same time, is intended to not interfere with the ongoing work at the G20 and OECD level on a reform of the international corporate tax framework. The Commission is particularly interested in gathering views on the main problems related to taxing the digital economy, for member states and business. It also asks for feedback on possible solutions to these problems. The consultation ends on 12 April 2021.
BEUC launches Europe-wide complaint against Nintendo for premature obsolescence
Following nearly 25,000 complaints from European consumers, BEUC, the European consumer association, and its members, have submitted a complaint about Nintendo to the European Commission and national consumer protection authorities for systematic problems with the functionality of the Nintendo Switch console. Consumers have expressed their dissatisfaction with a recurring technical problem with Nintendo Switch controllers, commonly referred to as “Joy-Con Drift”. This causes the games’ characters to move without touching the controller, making the console unusable. According to consumer testimonies, in 88% of cases, the game controllers broke within the first two years of use. On behalf of consumer groups in affected countries, BEUC has submitted a complaint to the European Commission and national consumer protection authorities for premature obsolescence and misleading omissions of key consumer information (on the basis of the EU’s Unfair Commercial Practices Directive). BEUC and its members are calling for a Europe-wide investigation into the issue and for Nintendo to be obliged to urgently address the premature failures of its product. Until then, BEUC says the faulty game controllers should be repaired for free and consumers should be properly informed about the limited lifespan of the product. Since coming onto the market, the console has sold more than 68 million units worldwide, many of which in Europe.