Response of the Office of the Communications Authority (OFCA) to the Press Release issued by Hong Kong Telecommunications (HKT) Limited (HKT) concerning its Role in Cessation Arrangements of Mobile Virtual Network Operator Services

In the past eighteen months, there were two incidents of abrupt cessation of mobile services of mobile virtual network operators (MVNOs) due to commercial disputes with the relevant mobile network operator which provided network capacity services to them (Hosting MNO).  The incidents affected more than 110 000 mobile service subscribers.  To safeguard the interest of telecommunications service users, OFCA prepared the draft Code of Practice on the Cessation Arrangements for Mobile Virtual Network Operator Services" (CoP) and discussed the draft CoP with more than 50 members of the Telecommunications Regulatory Affairs Advisory Committee (TRAAC) and the Telecommunications Users and Consumers Advisory Committee (TUCAC), and other representatives of the industry, including HKT, at a joint meeting of the two committees held four weeks ago (i.e. on 10 August 2017).

HKT only until last night (6 September 2017) issued a press release stating that OFCA had made false and misleading allegations against HKT during the above meeting held four weeks ago.  HKT's assertion was completely unfounded.

In fact, in the previous two incidents of the cessation of mobile services, even though OFCA, after being notified of the commercial disputes, had repeatedly and actively urged the operators concerned to report to OFCA the progress of their negotiation and kept requesting HKT, being the Hosting MNO in both incidents, to give not less than a week's service cessation notice, HKT only unilaterally gave a short service cessation notice period of much less than a week after the failure of the relevant commercial negotiations.  As a result, tens of thousands of affected subscribers were unable to make necessary arrangements such as number porting in time and their mobile services were interrupted.  The situation was extremely undesirable.  The impact caused by the recent incident concerning CMMobile Global Communications Limited (CMMobile) was particularly substantial.  HKT only gave a notice of less than 10 hours before terminating all its wholesale services to CMMobile, causing service cessation to more than to 60 000 subscribers.   Major information of the two incidents is set out in the table below:

MVNO Easycall Limited CMMobile
Time when HKT formally notified OFCA of its decision of service cessation 11 March 2016
 (by email)
16 January 2017
at 4:20 p.m.
(by email)
Time when OFCA issued the Consumer Alert 15 March 2016 16 January 2017
at 7:40 p.m.
Commencement of service cessation 15 to 31 March 2016 by phases 17 January 2017
at 2:00 a.m.
No. of affected customers 50 000 subscribers of activated pre-paid SIM cards 12 500 post-paid customers and 49 000  subscribers of activated pre-paid SIM cards
No. of consumer complaints/requests for assistance received 13 356

OFCA's statements about the service cessation notice period and the impacts on subscribers etc. in respect of the above two incidents of service cessation to the attendees of the joint meeting were merely a representation of facts.

The provisions in the proposed CoP stipulate in the event of the cessation of any mobile services of MVNOs due to commercial disputes with the Hosting MNOs or for whatsoever reason, the concerned parties are required to provide an advance notice of at least five business days (i.e. equivalent to one calendar week) to the affected MVNOs / subscribers and to provide a copy of such notice to the Communications Authority (CA) before the commencement of the notice period.

Save and except HKT, all members and other representatives of the industry welcomed or did not raise any objection to the implementation of proposed CoP at the joint meeting or in their subsequent submissions, for the purpose of enhancing the interest of telecommunications service users.

The CA will meticulously consider all the views collected, and will finalise the details of the CoP and determine the implementation date shortly.

Office of the Communications Authority

7 September 2017