The free ringtones and wallpapers which the company advertised online turned out to cost about nine Euros per week in reality. Before consumers could read the conditions indicating that they did have to pay, they first had to scroll past a blank section of the webpage. Only after scrolling the conditions would appear on the screen. According to the Consumer Authority’s report, these conditions were unreadable, even in the highest possible screen resolution. Many consumers, including many youngsters, were therefore not aware at all of the fact that they were taking out a costly subscription. Terminating this subscription proved to be not easy either, because the “key word” that had to be sent in for this purpose was given at the bottom of a text message – under a blank window.Besides placing “ordinary” misleading advertising banners on websites mainly targeting youngsters, the company offered an online memory game, with which participants could win an iPhone. However, it turned out that when someone played this game, besides the chance of winning an iPhone they also took out a subscription, under which the fortune-hunter would receive three wallpapers a week until notice of termination.
In January 2008 an investigation by the Dutch Consumer Authority and a negative opinion from the Dutch Advertising Code Committee resulted in a few changes made by Wizz Mobile on its website. These changes proved insufficient, for on 7 August 2008 the Consumer Authority decided to impose a EUR 76,000 penalty on Wizz Mobile for violation of Sections 3:15d, 7:46c and 7:7 of the Dutch Civil Code (the “BW”).
The Requirements of Section 3:15d of the BW
First of all, Wizz Mobile violated Section 3:15d (1) of the BW. The Consumer Authority held that the identity and address of establishment were not clearly mentioned on the various home pages of Wizz Mobile. Other data that are mandatory pursuant to Section 3:15d (1) of the BW, such as an e-mail address, a Trade Register number and the VAT identification number were not mentioned at first, and some time later they were only mentioned in a place of difficult access. Section 3:15d (2) further requires a “clear and unequivocal” indication of the price of the service offered. Wizz Mobile did not meet this requirement; only after having scrolled past a blank webpage section, the buyer would find a block of text in small print and little contrasting color. There was also no mention of the so-called “texting downloading costs” that were charged besides the three Euros per ringtone. Finally, it was not clear whether the prices were inclusive or exclusive of VAT.
The Requirements of Sections 7:46c and 7:7 of the BW
Besides the obligations to which each party offering a ‘service of the information society’ is subject, Wizz Mobile has also violated Section 7:46c of the BW, which provides what information should be provided to consumers prior to the conclusion of an agreement. This Section also prescribes that the identity of the seller and the price of the service including all taxes shall be stated in a clear and unequivocal manner. As described above, Wizz Mobile did not meet these requirements. Furthermore it provided no clarity about the main characteristics of the service, since it was not clear that it was really a subscription. It was also not clear to consumers until when they could download the ringtones for which they had paid. Wizz Mobile did not give information either about the option to cancel the sale, as set out in Section 7:46d. Moreover, consumers were not informed of the minimal duration of the agreement. An agreement is concluded at the moment when the consumer buys the ringtone. As a rule, taking out a subscription qualifies as an agreement for unlimited time. The Consumer Authority stipulates that this must be communicated in an unequivocal manner. Often consumers would only become aware of the fact that they had taken out a subscription when they received high phone bills, and then they had to go into much trouble to cancel their subscriptions.
Finally, Wizz Mobile has violated Section 7:7(2) of the BW, which prohibits the sending of things to natural persons which they have not ordered and then requesting payment.
It is clear from the composition of the amount of the penalty that the violations of the obligations towards consumers of Section 7:46c of the BW are counted most heavily against Wizz Mobile. Half of the total amount of the penalty is reserved for this purpose. The fact that Wizz Mobile targeted its services partly to children and youngsters is also counted heavily against it. Fighting ringtone providers who do not provide clear information is one of the key objectives of the Consumer Authority, which has sent out a clear signal with this heavy penalty. It is not known yet whether Wizz Mobile has lodged an objection to the decision.