On 13 May 2013, the Australian Communications and Media Authority (ACMA) announced that it was seeking public comment on proposed regulatory changes to establish a more efficient and effective set of identity verification requirements for prepaid mobile carriage services. This initiative follows a review by an industry and government working group led by the Department of Broadband, Communications and the Digital Economy (DBCDE) and a request from the Minister for Broadband, Communications and the Digital Economy to the ACMA to introduce the necessary regulatory changes. The review and Minister’s request were supported by a Regulation Impact Statement (RIS) prepared by DBCDE on Changes to Identity Verification Requirements for Prepaid Mobile Services. Prepaid mobile services are viewed as a popular option for users with low usage requirements and basic or inexpensive handsets. Prepaid services generally allow users to better control their spending and are suitable for people who may not be able to pass the credit checks required for post‑paid accounts. Prepaid mobile service providers are required by law to collect certain information about their customers and to verify their customers’ identities before activating a service. The requirements were put in place to prevent the use of anonymous prepaid services and ensure that law enforcement and security agencies can gain accurate information about prepaid customers should they need to do so during investigations. Changes in the market have significantly reduced the effectiveness and efficiency of the current identity verification requirements. When the availability of prepaid SIMs was limited to service provider shopfronts, service providers were the only entities required to verify the identity of their customers. However, significant growth in the number of third party retailers selling SIM cards means many more entities are now required to verify the identity of prepaid mobile customers on behalf of the three main service providers. As business models shift to take advantage of the internet, the number of service providers and third party retailers integrating online activities into their business practices is increasing. In this environment the existing identity verification arrangements, which were designed to be carried out face-to-face and are predominately paper-based, are becoming increasingly ineffective and burdensome. Problems with the current system include cost, compliance and inefficiencies in collecting and retrieving information. In response to concerns raised during consultation, the preferred option provides flexibility regarding the adoption schedule and reduces costs by not mandating commencement of the new regime from a specified date. Industry will be allowed to continue the current arrangements in the short-term and adopt new electronic verification methods as they become available. The proposal also takes into account the needs of groups who may have problems obtaining identification documents and improves privacy arrangements for prepaid mobile customers. It is proposed that the arrangements will be reviewed two years after the new identity verification methods become available. At that time, the removal of the existing point of sale arrangements will be considered. The RIS was prepared by DBCDE and assessed as adequate by the Office of Best Practice Regulation.
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