Friday, 25 March 2011

Some of my tweets this week...

30 minutes of fun, 30 years on the meds. The number of HIV infections in the UK has doubled in the last 10 years -

Watch you step after one sangria too many - quite the pavement

Ladies and gentleman, please fasten your seat belt. Except for Pete the Penguin -

Wedding bells: best day of your life? Not on this video --

Thailand - She = he. Subtitles start after the song; undoubtedly the raunchiest jury ever --

Watford swan: the blog of an English girl at a top Russian ballet school.. and she's from Watford -

Monday, 21 March 2011

South Africa’s e-businesses are preparing for new Consumer Act

South Africa is preparing for a new consumer protection regime, since the Consumer Protection Act (CPA) is set to come into force on 1 April 2011.

The CPA, which was signed into law in April 2009, “is not just another Act,” said Gerrie Van Gaalen, Partner at Van Gaalen Attorneys. “It will ensure that suppliers deal with consumers without withholding important information.”

The CPA sets out strict rules for businesses and creates a number of consumer rights, such as the right to inspect goods and the right to information. Fixed-term agreements will have to be in ‘plain and understandable language’ and courts will get the power to redraft consumer contracts.

“The CPA will oblige e-commerce sites to abandon the practice of providing bare minimum or often just generic information about items, stock availability and delivery terms,” said Godfrey Parkin, CEO of Britefire. “And businesses will now have to take the privacy and security of customer data very seriously.”

Many e-businesses are in the process of reviewing the text of standard agreements, terms and conditions, and are rethinking the wording of their marketing. “They are also scurrying to try to get their mailing lists in order, since South Africa has never had anti-spam legislation with any teeth,” said Parkin. “There is a lot of scrambling taking place to try to be compliant before 1 April.”

This is not a surprise since “failure to comply could lead to jail time or a fine, which could be as much as R1 million, or 10% of annual turnover, whichever is greater,” explains Simone Monty, Partner at Eversheds.

Published previously in E-Commerce Law & Policy, March 2011. Copyrights apply.

Friday, 11 March 2011

Opinion: Facilitating problems online

The UK Gambling Commission (GC) presented its British Gambling Prevalence Survey 2010 (BGPS) on 15 February - the first specific data on the current state of play of the gambling market in the UK since the enactment of the Gambling Act 2005, in September 2007.

One of the most remarkable conclusions of the GC is that nearly three quarters (73%) of adults in the UK gamble. Whether offline or on the net, playing the Lotto twice a year or spending days on end at William Hill, it is a significant increase compared to 68% in 2007.

“The survey confirms that there is a significant and growing number of people who take part in gambling”, said Brian Pomeroy, the GC’s Chairman, highlighting the importance of the GC’s work and therefore supporting its existence, in response to reports published in October 2010 urging the UK Government to abolish the GC, or at least to merge it with another commission at the Department for Culture, Media and Sports.

Those who thought gambling is a man’s world, should think again. The GC found that more women than ever before have found their way to a casino, whether on- or offline. The BGPS generally shows that gambling has become more accepted and more mainstream.

The question as to whether the UK Gambling Act 2005 has contributed to this change - whether the law facilitates gambling, or in other words whether gambling facilities are too easily accessible in the UK - was raised at the press conference for the presentation of the Survey on 15 February in London.

Not surprisingly, it was ‘not the Gambling Commission’s task to answer that question’. However, the BGPS could not deny that the number of problem gamblers in the UK has gone up significantly in the last three years, from 0.6% of the adult population in 2007 to 0.9% in 2011, which means that more than 150,000 adults have become new problem gamblers since 2007. Interesting numbers if you keep the economic crisis, pay freezes and rising unemployment figures in mind.

Whilst the number of adults placing a bet might have gone up, online gambling figures are nowhere near those spectacular numbers. Even though 17% of all gamblers said they play offline as well as on the net, only 2% of the adults who gambled last year did so exclusively online. Although there are no concrete figures, the GC said many of the (new) problem gamblers fit in this category: ‘in an offline casino, someone can be stopped, his age can be verified or if he had one drink too many he can be sent away. On the net, that is impossible’.

Published previously in World Online Gambling Law Report, February 2011. Copyrights apply.

Betsson’s China move fuels market opening speculation

Swedish operator Betsson announced on 8 February it ‘has established a business relationship with a local company in China which has set up a joint venture (JV) in the sports lottery related industry together with a Chinese state owned company’, the company said in a statement, fuelling speculation that China is beginning to open its online gambling market.

Paul Davis, Managing Director of Counting House, is “not sure whether this move signals an opening of the market, but at least it signifies a willingness to put a toe in the water and test the temperature, something that appeared very unlikely for years”. Davis expects other operators to follow “almost certainly, although the supply of suitable [Chinese] partners may be found very thin indeed”.

Wei Zhang, Partner at Jun He, is more sceptical: “Even though the online sale of two types of lotteries are now permitted, we cannot reach the conclusion that online gambling will be allowed in the near future, as this is against the political and moral guidance that one should get rich through hard work”.

Currently, only welfare lotteries and sports lotteries are legal in China, which boasts the largest and fastest growing number of internet users in the world. “I believe that the authorities will fully understand our structure and will continue and support it, by issuing a sale permit to this JV in due course”, said Pontus Lindwall, CEO of Betsson.

In China, all gambling activities are controlled by the state - that is why “Betsson's choice of partner should be highly scrutinised, it almost certainly brings government involvement in the market with it”, said Nao Matsukata, Senior Policy Advisor at Alston and Bird LLP. Davis thinks this is actually an advantage: “For two decades the route to sustainable business development in China has been through joint ventures with local businesses”, he said. “[Betsson’s] choice of partner is commendable in that closeness to government is one of the best guarantees of continuity.”

Matsukata points out other issues: “Considering Beijing's strict control of the internet, there are bound to be privacy and data security issues for online gamblers of the services that Betsson may come to offer”, he said. “Consumers and service providers will both eagerly wait what model it develops to protect sensitive information.” Betsson did not disclose the name of the Chinese ‘local company’ it has established a relationship with.

Published previously in World Online Gambling Law Report, February 2011, London. Michiel Willems, copyrights apply.

FB launches credit-only payment tool

The social networking site Facebook has announced it will make Facebook Credits (FC) – the site’s online currency – the single buy-in point to convert real money into credit that can be spent on games and other applications.

Facebook confirmed on 25 January it is planning to force game developers to only accept the FC currency as a payment method on the website. All social game developers (such as the immensely popular Farmville) will have to comply by 1 July.

Although developers can still use their own ‘in-game’ currencies, it does mean that consumers will be required to process the transactions with FC. Facebook works with more than 350 applications and 150 developers.

“The new requirement is a natural progression in the growth of Facebook's brand”, said Mark Herpel, Editor of DGC Magazine. “Requiring a ‘one-size-fits-all’ currency reduces the barriers of entry and should greatly benefit developers. I do envision a ‘pay with [FC]’ option in the near future where this virtual currency can be used in third-party websites to buy physical goods.”

Published previously in E-Finance &PL&P, February 2011. Copyrights apply.

Telefónica and MasterCard bring m-payments to South America

MasterCard and Telefónica announced on 25 January they will introduce mobile payments in 12 countries in South America (SA).

The US payment service provider and the Spanish mobile phone operator said in a statement that a joint venture will ‘offer mobile financial solutions’ through Telefónica’s Movistar network, one of the biggest in SA. Services such as bill payments and retail purchases will be linked to a mobile wallet or prepaid account in, among others, Argentina and Mexico.

“A first of its kind with that scale in Latin America”, said Aiaze Mitha, CEO of Amarante Consulting. “This venture has the potential to transform the payments landscape [in SA].’’
Eduardo Ferrari, Partner at Posadas, Posadas & Vecino in Uruguay, thinks the initiative “is very significant because of the magnitude of the investment and the lead role of its participants in their respective fields as it provides a brand new service”.

The joint venture could be a big step forward in making banking services accessible to millions of unbanked people, since 70% of South Americans do not have a bank account but most of them do own a mobile phone. “It sends a very strong message to the [SA] industry”, said Aiaze Mitha. “A card association is willing to partner directly with mobile operators and align their strategic interests to conquer the unbanked market.”

“The cell phone market has reached costumers of all different ages and asocial structures”, added Ferrari. “There are currently more cell phones than inhabitants in Uruguay.”

Published previously in E-Finance &PL&P, London, 2011. Copyrights apply.

Anger over usage-based bills and small ISP caps in Canada

A ruling by the Canadian Radio Telecommunications Commission (CRTC), the country’s telecoms and internet regulator, has outraged many Canadians and turned usage-based internet billing (UBB) - bills based on internet usage per month - into a national issue.

The CRTC decided on 25 January that internet service providers (ISPs) could continue charging customers for exceeding their monthly broadband allowance. However, following the negative response from the public, the independent regulator released a statement on 3 February stating that the ‘decisions were set to take effect on 1 March, but in light of the evident concerns expressed by Canadians, [the CRTC] has decided to delay the implementation by 60 days’ and ‘launch a review’. Industry Minister Tony Clement said it will “not [be] acceptable for the government” if the decision remains unchanged. Clement said earlier that UBB would ultimately lead to “more competition and lower prices”. Most bills, however, have risen sharply since September 2010, when the CRTC allowed large ISP Bell to start billing its customers for exceeding their monthly broadband allowance.

The ruling has reignited the  debate about UBB in Canada. The Vancouver Sun wrote that ‘[UBB] will artificially inflate the costs of online access’, while Michael Hinka, commentator for CBC, said UBB would be “fairer for light users. Pay for what you use.”

“Customers who don’t use much may prefer a pay-per-use model. However, that does not appear to be the view of the majority”, said Chris Bennett, Partner at Davis LLP. “The public backlash against the decision has been significant. As a result, there appears to be strong political support for reconsidering the decision.”

Another issue is the position of smaller ISPs. Although the CRTC ruled that Bell has to offer its wholesale customers - smaller ISPs who ‘rent’ space on Bell’s network - a 15% discount when exceeding their limits, it can impose a cap on these limits, limiting smaller ISPs’ use of networks. “[The ruling] will make it difficult for smaller ISPs to differentiate their services and stifle competition”, said Bennett. “That is an issue because there is already very little competition in Canada.”

“The industry in Canada is essentially an oligopoly”, explains Bernice Karn, Partner at Cassels Brock, while Martin Kratz, Partner at Bennett Jones, wonders “whether a discount is sufficient to permit wholesale operators to survive and differentiate themselves.”

Published previously in E-Commerce L&P, February 2011. Copyrights apply.