DMA Public Affairs round-up: nuisance calls legislation changed and the EU DPR makes good progress

Since the last Public Affairs update, the government has changed the law on nuisance calls and texts, the Chancellor announced a number of measures in the Budget, the DMA suffered a setback in its attempt to resolve VAT for advertising mail with HMRC and the EU Data Protection Regulation nears completion in the EU Council.

Nuisance calls

The Department of Culture, Media and Sport (DCMS) decided to remove the reference to significant ‘damage’ or ‘distress’ in the PECR legislation. This means that the Information Commissioner’s Office (ICO) will be able to prosecute rogue companies that send spam texts or make nuisance calls more easily, hopefully stemming the problem. The Telephone Preference Service (TPS) has experienced a five-fold increase in the number of new registrations in March – suggesting companies are tightening their business practices in view of the legislation. In a typical month, around six companies will apply for a TPS license. In March, 31 companies registered – a 417% increase.

Pre-election budget

In March the Chancellor announced his pre-election budget, which included a few sweeteners. This was due to an economic boost from tax receipts (that was better than expected) and inflation reducing interest costs for the government.

Headline announcements:

- The personal tax allowance will rise to £10,800 in 2016 and £11,000 in 2017.

- Leeds and other northern areas to be granted new powers in attempt to invigorate growth in the north. This ‘Northern Powerhouse’ will attempt to emulate the success of London.

- Investment in the internet of things.

- A £3.5 million investment package to protect consumers from nuisance calls.

Among many others, which are detailed in the full report.

VAT for advertising mail

Financial service brands and charities were the two big losers in April 2012, when bulk mail lost its VAT exempt status and postage costs became subject to VAT charges of 20%. As a result, financial services companies and charities began using so called ‘single sourcing’ to mitigate their VAT costs. However, the DMA reached agreement on how postage and other services should be treated in future and agreed an implementation date of 1 April 2015 so that the industry has time to put in place alternative arrangements.

Unfortunately, HMRC still hasn’t published fresh guidance on the issue and the date of 1 April 2015 was unworkable as businesses need new guidance to follow before they can change their business practices. As a result, the DMA has written to David Gauke MP, Financial Secretary to the Treasury, asking that businesses are given at least a 3 month adjustment period once new guidance has been published by HMRC and that no retrospective penalties will be pursued after 1 April 2015.

EU Data Protection Regulation

The EU council needs to reach an agreement on chapter III, VIII and on definitions in chapter I in order to reach a general agreement. Thus far, council negotiations have been based on the ‘nothing is agreed until everything is agreed’ principle – the so called partial general approach. This means that even if a general agreement is reached in June, the council will still be able to review parts of the text. The last council meeting is on 15 June 2015. A general agreement will be reached on this date, if the Latvians succeed on securing an agreement.

The DMA continued with its lobbying efforts and met with EU commission official Bruno Gencarelli, who is head of data protection, in late-January to highlight the DMA’s concern with parts of the regulation and to introduce the DMA Code to the commission.

See the one-to-one public affairs bulletin Jan-Mar 2015 for more details and a full account of the legal and political developments over the last few months.