Legal notice: PTA moves to end SMS-based prize winning schemes

Cellular operators ignore guidelines as regulator has no ruling on the subject.

KARACHI:

Given that Pakistan Telecommunication Authority (PTA) has no legal document – a government ruling or regulation – to stop telecom operators from running tempting prize winning schemes, the latter continue with their inaami schemes, sending text messages to end users for participation.

PTA, in an official notice dated May 28, directed telecom operators to stop all prize schemes including genuine ones or face legal action from the regulatory authority. Based on the nature, the content and increasing number of complaints on the subject, read the notice, PTA considered the schemes were misleading and violated the Telecom Consumer Protection Regulation, 1999. The telecom regulator also directed the operators to submit a compliance report by May 30.

Instead of submitting the compliance report, telecos obtained a stay order on the issue the very next day; both PTA and telecom sources confirmed. PTA currently has no regulation covering the subject – promotion of gambling; it, therefore, cannot challenge or take action against the telecom operators, a PTA official told The Express Tribune on the condition of anonymity, adding the regulator is working on reforming its regulations on prize schemes, which will also address activities that could promote gambling through telecos.

Given the absence of the aforesaid regulation, telecom operators assert their prize schemes – a highly profitable source of revenue for telecos, according to industry sources – are legitimate and will continue.

“We already told PTA that none of our schemes is against their laws,” said Mobilink Spokesperson Hussain Talib. He, however, supported the PTA’s notification saying that it was a good initiative by the authority.

Unlike Talib, another telecom source – who wishes to remain anonymous– said all telecom operators are running some kind of prize schemes: Mobilink’s SMS Khazana, Ufone’s ShahCar, Warid’s SMS Crore Ka and Telenor’s Sone Ki Jeet for example.

He said telecom companies have obtained a stay from Islamabad High Court in their favour, which nullifies PTA’s directions thus the ongoing schemes will continue. Asked if they would continue to launch similar prize schemes in future, he said that this will depend upon their business requirements and the decisions, in this regard, will be made in the light of the ruling of the court of law.

PTA had issued this notice on the direction of the Supreme Court (SC); reported more – a telecom and information technology magazine. While hearing a case on the subject, according to more, the SC said that all prize winning or inaami schemes, which promote gambling, are against Islamic values.

The PTA source, however, refused to comment on whether his company supports the SC’s ruling, saying the matter was sub-judice.

Asked why PTA did not reform its regulations in the past, the official said such prize winning schemes did not exist in the past; the use of these schemes increased only recently. He, however, could not give a time frame as to how long the authority will take to reform the regulation.

Asked if the regulator will counter the telecos in the court of law, he said, the court will require a legal document – which PTA is currently working on – to decide the case in their favour.

“Once the regulation is reformed, PTA will have the final word: it will stop the telecos from running such schemes,” he said.

Published in The Express Tribune, June 3^rd, 2012.