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Wednesday, September 9, 2015, 16:53

Data abuse: Service provider fined HK$ 30,000

By Kahon Chan /

HONG KONG - Internet service provider Hong Kong Broadband (HKBN) has been fined HK$30,000 for inviting a subscriber to renew contract even after he had refused use of his personal data for the purpose of direct marketing.

The landmark conviction handed down at the Tseun Wan Magistrates' Court set a precedent for a new offense notified on April 1, 2013 by an amendment to the Personal Data (Privacy) Ordinance.

Data compilers, under the new law, are mandated to gain consent of individuals providing personal data before using such data for direct marketing purposes.

As such, a HKBN subscriber made it clear to the company in April 2013 that he wouldn't like his data to be used for any form of direct marketing.

But the subscriber eventually received a voice message from a customer service executive who contacted with a special renewal offer ahead of a planned fee rise. The subscriber then filed a complaint with the Office of the Privacy Commissioner for Personal Data.

A representative of the company pleaded not guilty, arguing the call was merely a renewal reminder.

But Magistrate Debbie Ng Chung-yee, based on conversation scripts provided by the company, ruled that HKBN had deliberately instructed customer service executives to use subscription renewal as an excuse to pitch new services. And, the magistrate noted, the calls constituted direct marketing even though made to existing customers, because promotion of new contracts had not been included in the data usage clauses agreed to by subscribers.

The subscriber who had made the complaint, the Magistrate noted, still had six months before her Internet subscription expired when the call was made to her. A subscriber was expected to be aware of the terms of contract with or without a reminder, and such a reminder could easily have been issued to the subscriber a couple of months before the deadline, Ng noted.

Ng also deemed a conversation over the phone as unnecessary to make a reminder, noting a text message or a letter would have been more than enough.

Preset scripts distributed to customer service callers also indicated strongly that the company aimed to seek contract renewal by the subscribers, rather than merely reminding customers of the looming expiration - callers were instructed to fix another time to call subscribers even when they had been clearly informed of it.

HKBN had earlier defended itself saying that the caller, who has since resigned, was not following instructions. But Ng concluded that had the caller strictly adhered to company guidelines, the action could still have constituted a breach of the personal data law.

According to HKBN, the complaining subscriber eventually renewed her contract.

A HKBN spokesperson told reporters that the company would file an appeal, but did not state clearly if it intended to change internal practices in the mean time.

Maximum penalty for the offense for which HKBN has been convicted is HK$500,000.

Deputy Privacy Commissionerfor Personal Data Fanny Wong Sam-hing said outside the court that the sentence would hopefully act as a deterrent.

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