- Email: [email protected]
TELECOMS REGULATION — HONG KONG
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TELECOMS REGULATION HONG KONG HONG KONG’S CODE OF PRACTICE ON PROTECTION OF CUSTOMER INFORMATION FOR FIXED AND MOBILE SERVICE OPERATORS Gabriela Kennedy, Lovells, Hong Kong
1. INTRODUCTION On 17 June 2002, the Consumer Council, the Independent Commission Against Corruption (ICAC), the Office of Privacy Commissioner of Personal Data and the Office of the Telecommunications Authority (OFTA) issued a joint Code of Practice on the protection of Customer Information for Fixed and Mobile Service Operators (the Code). The Code applies to fixed and mobile operators, with the latter including current holders of 2G and 3G licences as well as mobile virtual network operators. The objective of the Code is to offer general guidelines for mobile and fixed service operators in protecting the personal data of customers (that is, a customer’s telephone number, residential address and details of call history). The Code is voluntary and the suggested guidelines are not exhaustive, but merely underline good practices for fixed and mobile service operators for the protection of customer information in light of existing sanctions for the unauthorized disclosure of such information to third parties.
2. CURRENT LEGAL PROVISIONS AND/OR LICENCE CONDITIONS RELATING TO THE PROTECTION OF CUSTOMER DATA Fixed and mobile service operators and/or their staff may incur liability for the unauthorized disclosure of customer data. Checks against such disclosure are also contained in the terms of licences of fixed and/or mobile telecoms operators. One of the six principles of the Personal Data (Privacy) Ordinance (Cap. 486) (PDPO), namely principle 4, requires data users (i.e. entities collecting personal data) to take practicable steps to ensure that personal data is protected from unauthorized use, accidental access, processing or erasure. Although under PDPO a breach of a data protection principle is not an offence, the Privacy Commissioner for Personal Data may require compliance by sending an enforcement notice to a telecoms licensee. A breach of an enforcement notice, however, constitutes an offence. Customers of telecoms operators are entitled to compensation for damages (including injury to feelings) suffered as a result of breaches of a requirement of a data protection
356
principle under PDPO. Telecoms operators can be held vicariously liable for actions of their employees, so protection by way of appropriate terms in the contract of employment of staff is advisable. Although the guidelines set out in the Code are not mandatory and only outline best practices for staff of operators and operators alike, they should be taken as an opportunity to review existing procedures and terms of employment of staff. Another possible sanction for the unauthorized disclosure of personal data is to be found in the Prevention of Bribery Ordinance. Under S.9(1) of this Ordinance, disclosure of customer data for an advantage by an agent (staff) on behalf of its principal (telecoms operator) may constitute an offence. Staff of fixed and/or mobile service operators therefore need to be reminded of the consequences of the unauthorized disclosure of customer personal data for an advantage. Again, in order to avoid embarrassment to the company, appropriate sanctions may need to be included in the conditions of employment of staff. Provisions relating to the disclosure of customer data also exist in the licence conditions of telecoms operators. A licensee cannot use customer information for other purposes other than those required for the provision of the respective service by the licensee. All telecommunications licences have a licence condition stating that a licensee cannot disclose customer information, unless the customer has given his consent. The form of consent needs to be approved by the Telecommunications Authority. Sanctions for breach of a licence condition vary from directions issued by the Telecommunications Authority (TA) requesting compliance, to the cancellation withdrawal or suspension of the licence and/or financial penalties. In particular, the Telecommunication (Amendment) Ordinance 2000 introduced increased financial penalties for breaches of licence conditions of up to HK$10 million for repeat offences. Financial penalties will only be imposed where, in all the circumstances of the case, the action taken is reasonable and proportionate in relation to the failures giving rise to the penalty and where the TA has given the licensee a reasonable opportunity to make representations to him before any action is taken. Before a financial penalty is imposed, a
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licensee is also normally afforded a reasonable opportunity to comply with the condition of the licence breached.
3. NEW GUIDELINES The Code sets out guidelines for fixed and mobile service operators in preventing the unauthorized disclosure of customer information by their staff. They include having a policy on the protection of customer personal data; adopting technical measures for the protection of customer personal data; ensuring location security; ensuring that security is maintained by staff; and having a policy on and clear procedures for the transfer of customer personal data.
•
•
(a) Policy on Protection of Customer Personal Data Telecoms operators are encouraged to adopt a policy on the protection of personal data of customers. This can be achieved by having the following: • a data classification policy, whereby data are classified according to their degree of sensitivity and risk of exposure and security measures exercised to safeguard the classification of the personal data are defined; • an ethics and data privacy policy, whereby local and overseas employees are provided with explicit guidelines for the maintenance of confidentiality of customer personal data; and provisions are included in the employment contract regarding confidentiality of customer personal data and use of such data; the importance of prevention of bribery is addressed; and clear warnings and criminal sanctions for failure to comply with these requirements are adopted; • an access control policy,whereby access to different categories of data would depend on the level of authority of the staff, i.e. whereby, as a baseline, access to data would depend on the basis of a practical application of the “Need-to-know”principle; online printing and downloading of customer personal data to local personal computers or magnetic media would be controlled as such leaves no trail for auditing and that the duration of storage / file keeping of the materials containing customer personal data is limited).
(b) Technical Measures for the Protection of Customer Personal Data The Code recommends that telecoms operators should adopt technical measures for the protection of customer data. These include having: • an access authorization system (namely, promulgating procedures for applications for access to customer personal data, be they in electronic or paper form; having appropriate levels of approving authority; and adopting measures ensuring confidentiality of correspondence, e.g. sealed envelopes, where appropriate); • proper identification and authentication of staff having access to customer data, which would be achieved by giving such staff a user account of their own with user IDs and authentication by way of passwords; • proper password management, which would ensure the avoidance of disclosure of passwords by reminding staff
•
•
not to use obvious words or dates imposing a minimum length for the passwords; and a periodic aging of the passwords prohibiting the re-use of old passwords within a specific cycle; deactivating a user account upon a specified number of invalid log on attempts; procedures for access to Customer Information, which would ensure that staff do not access customer personal data other than in response of a customer’s request by imposing use of composite key for retrieving customer personal data and ensuring that audit trails are maintained for all activities performed by authorised users (and also for unauthorized access); procedures for ensuring security connection, i.e. procedures that would, at the very least, ensure that requests for connection can be checked and confirmed to be from known and authorised locations; and where the information requires additional protection then a service operator should encrypt transmissions to make the data unintelligible in event of interception; procedures for document security, namely ensuring that all practicable steps are taken to guard against unauthorized access to documents containing customer personal data and that where such documents need to be disposed of, all reasonable practicable steps are taken to ensure that this is done in a secure manner without disclosing customer personal data; procedures for making copies of identity documents by ensuring that copies of identity documents are only collected on a necessary and justifiable basis; if copies are made, that they are treated as confidential documents and stored in a secure place with restricted access; and retained no longer than necessary and disposed of securely and that the guidance on the collection and use of copies of identity cards in the Code of Practice on the Identity Card Number and other Personal Identifiers issued by the Office of the Privacy Commissioner for Personal Data is heeded.
(c) Location Security Insofar as the security of the place where customer personal data is stored is concerned, the Code suggests that physical access to such locations, i.e. computing centres, should be controlled and monitored and restricted to authorised personnel only. Further, where customers can send applications for services by means of fax, a dedicated fax machine should be used and the equipment should not be located in open areas; the positioning of workstations should be such so that customer personal data would not be viewed by unauthorized parties; where necessary screen savers should be used.
(d) Staff Security Most security breaches occur from the inside. The Code outlines good practices that ensure that staff maintain the security of customer personal data. These include having: • security training for staff including sending security reminders to staff on a regular basis; • clear operational guidelines for operators to follow when answering enquiries relating to ex-directory service
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customers and ensuring that no information of these customers is disclosed by operators (this applies only to fixed service operators); • staff deployment, using integrity as a selection criteria where staff are selected for critical positions; • supervision, i.e. routine and random supervisory checks to detect unexpected / irregular activities of employees, e.g. system access during odd hours or unusually high levels of
(e) Transfer of Customer Personal Data The final guidelines in the Code relate to the transfer of customer data and relate to dealings between a service operator and third parties. Under the Personal Data (Privacy) Ordinance, the class of persons to whom personal data may be transferred by a data user needs to be disclosed to the data subject at the time of collection. The cross-border transfer of personal data is prohibited (S.33), unless certain exemptions apply, though it is to be noted that S.33 of PDPO is not yet in force. The guidelines contained in the Code appear to apply to transfers of data, both within and out with Hong Kong. They suggest that a telecoms operator should: • inform customers on or before the collection of data that the data may be transferred for such purposes; • only transfer the data that is necessary for the outside parties to carry out their work; • take steps to ensure that customer personal data are transferred in a secure manner; • include terms and conditions in the agreements signed between the service operator and outside parties to: - prohibit the outside parties as well as their employees from divulging customer personal data obtained in the course of their duties;
- oblige the outside parties to protect customer personal data by complying with the data protection principles and policy to the same standards as service operators in Hong Kong; - require the outside parties to return or destroy the customer personal data when no longer required; - require the outside parties to provide an audit report on compliance to the requirements; - make a declaration that customer personal data transferred to them are not copied or used for purposes other than those assigned; - make sure that the outside parties will comply with these terms and conditions in the agreement.
4. CONCLUSION The Code provides useful guidelines for fixed and mobile telecoms operators in relation to the protection of personal data of customers. As the Code is voluntary and has not been issued under any particular ordinance, no presumption will arise against a telecoms operator that does not adopt the Code, in the event of a dispute over the disclosure of customer information. It is hoped that the legal sanctions outlined at the beginning of this article will, in any event, provide the right incentive for the adoption of the Code by most fixed and mobile telecoms operators in Hong Kong. Gabriela Kennedy , Report Correspondent, Consultant Technology, Media and Telecommunications Group, Lovells, Hong Kong © Gabriela Kennedy
BOOK REVIEW Multimedia Copyright Copyright and Multimedia Works – a comparative analysis by Irini A. Stamatoudi, 2002, hard-cover, Cambridge University Press, 317 pp., £55.00, ISBN 0 521 80819 7. The aim of this work is to provide a comprehensive comparative analysis of multimedia works and copyright protection. Multimedia products have experienced tremendous market success yet, as the author suggests:“Too often they are given inadequate protection under existing national and international copyright schemes.” A detailed introduction outlines the nature of multimedia works, as well as the scope of existing legislation with separate chapters considering collections and compilations, databases, audiovisual works and computer programs (video games are here treated as a ‘test case’).The author then analyses issues of qualification and resumes of protection and offers a model for a European legislative solution.The book is intended for academics and students as well as practitioners and copyright policy makers.The law is as stated at 1 April 2001.The work is published within the series of Cambridge studies in intellectual property rights.These are a series of monograph studies of major current issues in intellectual property with each volume containing a mix of international European comparative and national law. Available from Cambridge University Press, The Edinburgh Buildings, Shaftesbury Road, Cambridge CB2 2RU. Tel: +44 (0) 1223 325 892. Fax +44 (0) 1223 325891. Email: uksales/cambridge.org. Internet:.
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TELECOMS REGULATION HONG KONG HONG KONG’S CODE OF PRACTICE ON PROTECTION OF CUSTOMER INFORMATION FOR FIXED AND MOBILE SERVICE OPERATORS Gabriela Kennedy, Lovells, Hong Kong
1. INTRODUCTION On 17 June 2002, the Consumer Council, the Independent Commission Against Corruption (ICAC), the Office of Privacy Commissioner of Personal Data and the Office of the Telecommunications Authority (OFTA) issued a joint Code of Practice on the protection of Customer Information for Fixed and Mobile Service Operators (the Code). The Code applies to fixed and mobile operators, with the latter including current holders of 2G and 3G licences as well as mobile virtual network operators. The objective of the Code is to offer general guidelines for mobile and fixed service operators in protecting the personal data of customers (that is, a customer’s telephone number, residential address and details of call history). The Code is voluntary and the suggested guidelines are not exhaustive, but merely underline good practices for fixed and mobile service operators for the protection of customer information in light of existing sanctions for the unauthorized disclosure of such information to third parties.
2. CURRENT LEGAL PROVISIONS AND/OR LICENCE CONDITIONS RELATING TO THE PROTECTION OF CUSTOMER DATA Fixed and mobile service operators and/or their staff may incur liability for the unauthorized disclosure of customer data. Checks against such disclosure are also contained in the terms of licences of fixed and/or mobile telecoms operators. One of the six principles of the Personal Data (Privacy) Ordinance (Cap. 486) (PDPO), namely principle 4, requires data users (i.e. entities collecting personal data) to take practicable steps to ensure that personal data is protected from unauthorized use, accidental access, processing or erasure. Although under PDPO a breach of a data protection principle is not an offence, the Privacy Commissioner for Personal Data may require compliance by sending an enforcement notice to a telecoms licensee. A breach of an enforcement notice, however, constitutes an offence. Customers of telecoms operators are entitled to compensation for damages (including injury to feelings) suffered as a result of breaches of a requirement of a data protection
356
principle under PDPO. Telecoms operators can be held vicariously liable for actions of their employees, so protection by way of appropriate terms in the contract of employment of staff is advisable. Although the guidelines set out in the Code are not mandatory and only outline best practices for staff of operators and operators alike, they should be taken as an opportunity to review existing procedures and terms of employment of staff. Another possible sanction for the unauthorized disclosure of personal data is to be found in the Prevention of Bribery Ordinance. Under S.9(1) of this Ordinance, disclosure of customer data for an advantage by an agent (staff) on behalf of its principal (telecoms operator) may constitute an offence. Staff of fixed and/or mobile service operators therefore need to be reminded of the consequences of the unauthorized disclosure of customer personal data for an advantage. Again, in order to avoid embarrassment to the company, appropriate sanctions may need to be included in the conditions of employment of staff. Provisions relating to the disclosure of customer data also exist in the licence conditions of telecoms operators. A licensee cannot use customer information for other purposes other than those required for the provision of the respective service by the licensee. All telecommunications licences have a licence condition stating that a licensee cannot disclose customer information, unless the customer has given his consent. The form of consent needs to be approved by the Telecommunications Authority. Sanctions for breach of a licence condition vary from directions issued by the Telecommunications Authority (TA) requesting compliance, to the cancellation withdrawal or suspension of the licence and/or financial penalties. In particular, the Telecommunication (Amendment) Ordinance 2000 introduced increased financial penalties for breaches of licence conditions of up to HK$10 million for repeat offences. Financial penalties will only be imposed where, in all the circumstances of the case, the action taken is reasonable and proportionate in relation to the failures giving rise to the penalty and where the TA has given the licensee a reasonable opportunity to make representations to him before any action is taken. Before a financial penalty is imposed, a
Computer Law & Security Report Vol. 18 no. 4 2002 ISSN 0267 3649/02/$22.00 © 2002 Elsevier Science Ltd. All rights reserved
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licensee is also normally afforded a reasonable opportunity to comply with the condition of the licence breached.
3. NEW GUIDELINES The Code sets out guidelines for fixed and mobile service operators in preventing the unauthorized disclosure of customer information by their staff. They include having a policy on the protection of customer personal data; adopting technical measures for the protection of customer personal data; ensuring location security; ensuring that security is maintained by staff; and having a policy on and clear procedures for the transfer of customer personal data.
•
•
(a) Policy on Protection of Customer Personal Data Telecoms operators are encouraged to adopt a policy on the protection of personal data of customers. This can be achieved by having the following: • a data classification policy, whereby data are classified according to their degree of sensitivity and risk of exposure and security measures exercised to safeguard the classification of the personal data are defined; • an ethics and data privacy policy, whereby local and overseas employees are provided with explicit guidelines for the maintenance of confidentiality of customer personal data; and provisions are included in the employment contract regarding confidentiality of customer personal data and use of such data; the importance of prevention of bribery is addressed; and clear warnings and criminal sanctions for failure to comply with these requirements are adopted; • an access control policy,whereby access to different categories of data would depend on the level of authority of the staff, i.e. whereby, as a baseline, access to data would depend on the basis of a practical application of the “Need-to-know”principle; online printing and downloading of customer personal data to local personal computers or magnetic media would be controlled as such leaves no trail for auditing and that the duration of storage / file keeping of the materials containing customer personal data is limited).
(b) Technical Measures for the Protection of Customer Personal Data The Code recommends that telecoms operators should adopt technical measures for the protection of customer data. These include having: • an access authorization system (namely, promulgating procedures for applications for access to customer personal data, be they in electronic or paper form; having appropriate levels of approving authority; and adopting measures ensuring confidentiality of correspondence, e.g. sealed envelopes, where appropriate); • proper identification and authentication of staff having access to customer data, which would be achieved by giving such staff a user account of their own with user IDs and authentication by way of passwords; • proper password management, which would ensure the avoidance of disclosure of passwords by reminding staff
•
•
not to use obvious words or dates imposing a minimum length for the passwords; and a periodic aging of the passwords prohibiting the re-use of old passwords within a specific cycle; deactivating a user account upon a specified number of invalid log on attempts; procedures for access to Customer Information, which would ensure that staff do not access customer personal data other than in response of a customer’s request by imposing use of composite key for retrieving customer personal data and ensuring that audit trails are maintained for all activities performed by authorised users (and also for unauthorized access); procedures for ensuring security connection, i.e. procedures that would, at the very least, ensure that requests for connection can be checked and confirmed to be from known and authorised locations; and where the information requires additional protection then a service operator should encrypt transmissions to make the data unintelligible in event of interception; procedures for document security, namely ensuring that all practicable steps are taken to guard against unauthorized access to documents containing customer personal data and that where such documents need to be disposed of, all reasonable practicable steps are taken to ensure that this is done in a secure manner without disclosing customer personal data; procedures for making copies of identity documents by ensuring that copies of identity documents are only collected on a necessary and justifiable basis; if copies are made, that they are treated as confidential documents and stored in a secure place with restricted access; and retained no longer than necessary and disposed of securely and that the guidance on the collection and use of copies of identity cards in the Code of Practice on the Identity Card Number and other Personal Identifiers issued by the Office of the Privacy Commissioner for Personal Data is heeded.
(c) Location Security Insofar as the security of the place where customer personal data is stored is concerned, the Code suggests that physical access to such locations, i.e. computing centres, should be controlled and monitored and restricted to authorised personnel only. Further, where customers can send applications for services by means of fax, a dedicated fax machine should be used and the equipment should not be located in open areas; the positioning of workstations should be such so that customer personal data would not be viewed by unauthorized parties; where necessary screen savers should be used.
(d) Staff Security Most security breaches occur from the inside. The Code outlines good practices that ensure that staff maintain the security of customer personal data. These include having: • security training for staff including sending security reminders to staff on a regular basis; • clear operational guidelines for operators to follow when answering enquiries relating to ex-directory service
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customers and ensuring that no information of these customers is disclosed by operators (this applies only to fixed service operators); • staff deployment, using integrity as a selection criteria where staff are selected for critical positions; • supervision, i.e. routine and random supervisory checks to detect unexpected / irregular activities of employees, e.g. system access during odd hours or unusually high levels of
(e) Transfer of Customer Personal Data The final guidelines in the Code relate to the transfer of customer data and relate to dealings between a service operator and third parties. Under the Personal Data (Privacy) Ordinance, the class of persons to whom personal data may be transferred by a data user needs to be disclosed to the data subject at the time of collection. The cross-border transfer of personal data is prohibited (S.33), unless certain exemptions apply, though it is to be noted that S.33 of PDPO is not yet in force. The guidelines contained in the Code appear to apply to transfers of data, both within and out with Hong Kong. They suggest that a telecoms operator should: • inform customers on or before the collection of data that the data may be transferred for such purposes; • only transfer the data that is necessary for the outside parties to carry out their work; • take steps to ensure that customer personal data are transferred in a secure manner; • include terms and conditions in the agreements signed between the service operator and outside parties to: - prohibit the outside parties as well as their employees from divulging customer personal data obtained in the course of their duties;
- oblige the outside parties to protect customer personal data by complying with the data protection principles and policy to the same standards as service operators in Hong Kong; - require the outside parties to return or destroy the customer personal data when no longer required; - require the outside parties to provide an audit report on compliance to the requirements; - make a declaration that customer personal data transferred to them are not copied or used for purposes other than those assigned; - make sure that the outside parties will comply with these terms and conditions in the agreement.
4. CONCLUSION The Code provides useful guidelines for fixed and mobile telecoms operators in relation to the protection of personal data of customers. As the Code is voluntary and has not been issued under any particular ordinance, no presumption will arise against a telecoms operator that does not adopt the Code, in the event of a dispute over the disclosure of customer information. It is hoped that the legal sanctions outlined at the beginning of this article will, in any event, provide the right incentive for the adoption of the Code by most fixed and mobile telecoms operators in Hong Kong. Gabriela Kennedy , Report Correspondent, Consultant Technology, Media and Telecommunications Group, Lovells, Hong Kong © Gabriela Kennedy
BOOK REVIEW Multimedia Copyright Copyright and Multimedia Works – a comparative analysis by Irini A. Stamatoudi, 2002, hard-cover, Cambridge University Press, 317 pp., £55.00, ISBN 0 521 80819 7. The aim of this work is to provide a comprehensive comparative analysis of multimedia works and copyright protection. Multimedia products have experienced tremendous market success yet, as the author suggests:“Too often they are given inadequate protection under existing national and international copyright schemes.” A detailed introduction outlines the nature of multimedia works, as well as the scope of existing legislation with separate chapters considering collections and compilations, databases, audiovisual works and computer programs (video games are here treated as a ‘test case’).The author then analyses issues of qualification and resumes of protection and offers a model for a European legislative solution.The book is intended for academics and students as well as practitioners and copyright policy makers.The law is as stated at 1 April 2001.The work is published within the series of Cambridge studies in intellectual property rights.These are a series of monograph studies of major current issues in intellectual property with each volume containing a mix of international European comparative and national law. Available from Cambridge University Press, The Edinburgh Buildings, Shaftesbury Road, Cambridge CB2 2RU. Tel: +44 (0) 1223 325 892. Fax +44 (0) 1223 325891. Email: uksales/cambridge.org. Internet:
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