- At Kemp Little, we are known for our ability to serve the very particular needs of a large but diverse technology client base. Our hands-on industry know-how makes us a good fit with many of the world's biggest technology and digital media businesses, yet means we are equally relevant to companies with a technology bias, in sectors such as professional services, financial services, retail, travel and healthcare.
- Kemp Little specialises in the technology and digital media sectors and provides a range of legal services that are crucial to fast-moving, innovative businesses.Our blend of sector awareness, technical excellence and responsiveness, means we are regularly ranked as a leading firm by directories such as Legal 500, Chambers and PLC Which Lawyer. Our practice areas cover a wide range of legal issues and advice.
- Our Commercial Technology team has established itself as one of the strongest in the UK. We are ranked in Legal 500, Chambers & Partners and PLC Which Lawyer, with four of our partners recommended.
- Our team provides practical and commercial advice founded on years of experience and technical know-how to technology and digital media companies that need to be alert to the rules and regulations of competition law.
- Our Corporate Practice has a reputation for delivering sound legal advice, backed up with extensive industry experience and credentials, to get the best results from technology and digital media transactions.
- In the fast-changing world of employment law our clients need practical, commercial and cost-effective advice. They get this from our team of employment law professionals.
- Our team of leading IP advisors deliver cost-effective, strategic and commercial advice to ensure that your IP assets are protected and leveraged to add real value to your business.
- Our litigation practice advises on all aspects of dispute resolution, with a particular focus on ownership, exploitation and infringement of intellectual property rights and commercial disputes in the technology sector.
- We have an industry-leading reputation for our outsourcing expertise. Our professionals deliver credible legal advice to providers and acquirers of IT and business process outsourcing (BPO) services.
- We work alongside companies, many with disruptive technologies, that seek funding, as well as with the venture capital firms, institutional investors and corporate ventures that want to invest in exciting business opportunities.
- Our regulatory specialists work alongside Kemp Littles corporate and commercial professionals to help meet their compliance obligations.
- With a service that is commercial and responsive to our clients needs, you will find our tax advice easy to understand, cost-effective and geared towards maximising your tax benefits.
- At Kemp Little, we advise clients in diverse sectors where technology is fundamental to the ongoing success of their businesses.They include companies that provide technology as a service and businesses where the use of technology is key to their business model, enabling them to bring their product or service to market.
- We bring our commercial understanding of digital business models, our legal expertise and our reputation for delivering high quality, cost-effective services to this dynamic sector.
- Acting for market leaders and market changers within the media industry, we combine in-depth knowledge of the structural technology that underpins content delivery and the impact of digitisation on the rights of producers and consumers.
- We understand the risks facing this sector and work with our clients to conquer those challenges. Testimony to our success is the continued growth in our team of professionals and the clients we serve.
- We advise at the forefront of the technological intersection between life sciences and healthcare. We advise leading technology and data analytics providers, healthcare institutions as well as manufacturers of medical devices, pharmaceuticals and biotechnological products.
- For clients operating in the online sector, our teams are structured to meet their commercial, financing, M&A, competition and regulatory, employment and intellectual property legal needs.
- Our focus on technology makes us especially well positioned to give advice on the legal aspects of digital marketing. We advise on high-profile, multi-channel, cross-border cases and on highly complex campaigns.
- The mobile and telecoms sector is fast changing and hugely dependent on technology advances. We help mobile and wireless and fixed telecoms clients to tackle the legal challenges that this evolving sector presents.
- Whether ERP, Linux or Windows; software or infrastructure as a service in the cloud, in a virtualised environment, or as a mobile or service-oriented architecture, we have the experience to resolve legal issues across the spectrum of commercial computer platforms.
- Our clients trust us to apply our solutions and know-how to help them make the best use of technology in structuring deals, mitigating key risks to their businesses and in achieving their commercial objectives.
- We have extensive experience of advising customers and suppliers in the retail sector on technology development, licensing and supply projects, and in advising on all aspects of procurement and online operations.
- Our years of working alongside diverse software clients have given us an in-depth understanding of the dynamics of the software marketplace, market practice and alternative negotiating strategies.
- Working with direct providers of travel services, including aggregators, facilitators and suppliers of transport and technology, our team has developed a unique specialist knowledge of the sector
- Your life as an entrepreneur is full of daily challenges as you seek to grow your business. One of the key strengths of our firm is that we understand these challenges.
- Kemp Little is trusted by some of the worlds leading luxury brands and some of the most innovative e-commerce retailers changing the face of the industry.
- HR Bytes is an exclusive, comprehensive, online service that will provide you with a wide range of practical, insightful and current employment law information. HR Bytes members get priority booking for events, key insight and a range of employment materials for free.
- FlightDeck is our portal designed especially with start-up and emerging technology businesses in mind to help you get your business up and running in the right way. We provide a free pack of all the things no-one tells you and things they dont give away to get you started.
Scope of the Electronic Communications Exclusion
A recent change in financial services regulation called the Payment Services Directive 2 (PSD2) seems to have taken telcos by surprise and considering compliance should have been achieved by 13 January 2018, the applicability of PSD2 to a telcos business (whether fixed or mobile) should be urgently considered. Telco activity that was previously comfortably outside the scope of regulation may now be regulated by the FCA: an electronic communications service and/or network provider will now be considered as providing a ‘payment service’ where it provides ‘a voice based service’ that includes a revenue share arrangement with a third party, unless the telco falls within an exclusion.
Telcos must now either become authorised or comply with stringent requirements to qualify for an exclusion. These requirements include the following:
- Spend cap limits on carrier billing amounts;
- Notification to the FCA of reliance on the exclusion; and
- Annual submission of regular auditors reports confirming compliance with relevant regulation, in particular figures on the spend cap limits.
Kemp Little LLP has been working with telcos since the European legislation was in draft form. We have been helping telcos and others in the payments eco-system navigate the following questions:
Which services fall within the means of ‘voice based services’?
Telcos provide a wide variety of services under the heading ‘voice based services’, but will need to have a clear understanding of the services that fall within this rubric to ensure they fall outside the regulated sphere entirely or sit within the exclusion. ‘Voice based services’ are wider than ‘premium rate services’ regulated by the Phonepaid Services Authority and include directory enquiries and other non premium rate revenue share services that subscribers call using their voice service.
Which services fall within the definition of payment services?
Where telcos allow their customers to use carrier billing to pay for purchases or make calls with a revenue share element (eg third party directory enquiries), telcos may be providing payment services. Telcos will therefore need to understand which of the services they offer might fall within the new PSD2.
How do spend caps affect general telco obligations?
To stay within the exclusion and avoid the need to be regulated, telcos will have to comply with the spend caps, restricting the amount customers can charge to their bill, on both a per-transaction and monthly basis.
How to comply with spend caps?
Compliance with spend caps will require telcos to have in place the appropriate systems and controls, which may be challenging for telcos with older systems. However, compliance – and, critically, being able to provide evidence of compliance on an annual basis – is essential, as telcos cannot benefit from the exclusion otherwise.
What control mechanisms should be put in place to continue to fall within the FCA exclusion?
Telcos will need to ensure that carrier billing or calls/SMSs with a third party revenue share element is strictly limited to the amount of the spend caps; their control mechanisms should be sufficiently robust to track customer spending as well as manage customer notification in the event spend caps are triggered.
What can happen (and is most likely) in the event the spend caps are breached?
Where telcos breach the spend caps, this means they are providing a regulated payment service without appropriate authorisation. They will need to regularise their regulatory position to avoid the imposition of sanctions by the FCA.
When is an audit report needed and what should it cover to continue to rely on the
Telcos falling within the exclusion will need to make an official notification of their status to the FCA, as well as providing annual audit reports providing specific information about the services it provides with a ‘payment service’ element, essentially to demonstrate to the FCA that they do in fact comply with the requirements of the exclusion. Telcos must therefore have in place systems to allow auditors the necessary access, as well as the records of their compliance with the requirements for the auditors to review.
If you need further assistance or guidance considering these issues or wider guidance on PSD2 or other opportunities brought about by this change in legislation, please do not hesitate to contact us