With the latest directive release from Orange regarding connections which are now deemed to be active or inactive dependent on if a customer makes at least 10 minutes of calls per month, this is yet another example of hitting the dealers at every opportunity.

Orange states that commissions will be clawed back from dealers if through a formula that only Orange knows inactive connections are above 10% then all commissions will be clawed back.  The question we ask is WHY?

Networks pay a commission to the dealer for acquiring a customer onto their network, the size of that commission is determined by what tariff or plan the customer goes onto.  As long as the customer is still connected to the network, i.e. the network still retains that customers business, then why should dealers keep getting clawed back commission when the customer is still paying line rental to the network.  The networks still has the customer on their books thanks to the dealer, then why try to claim the commission back.

Dealers have been for years plagued by such claw backs, for just about everything you can think of from change of tariff, to moving from consumer to business plans etc, and it’s the never ending round of claw backs that have hit dealers hard, to the extent of putting some small dealers out of business because they lose that vital piece of income.  Others because they have lost the commission means they are not able to utilise that money to make better offers to consumers and business.

The favourite one of networks is the “Suspect Fraud” claw back usually we think because the consumer is either late paying their bill or has not paid it but again the network provides no proof to the dealer.  But if they are still connected to the network then why should the dealer lose out, after all it’s the networks that run the credit check and look at the customers financial history, and it’s the networks that say to dealers that the applicant is accepted or not, so it should be the network that should accept that risk not claw back the dealers commissions.  After all the network paid him to acquire the customer to the network.

The latest Orange directive states that it’s the dealer’s responsibility to ensure that connections are active to retain commission, but neither the dealer nor the network has the right to dictate to a consumer that they MUST use their phone.  What about those who might be in hospital for over a month they wont use the phone, or what about single people or mothers who only use their phone for emergencies or occasionally.  This is just one more directive too far.

Ofcom competition division has arranged to have a meeting with the IMPDA and other dealers on the 15^th June to discuss the claw back issue affecting the majority of dealers in the UK.  It is our opinions that in many cases claw backs by networks are not only unfair terms but is also anti competitive, and does not help the consumer have a better choice.

If any dealer has evidence of claw backs and for what, we would appreciate copies to be faxed to us on 01865464366 or send via email to This e-mail address is being protected from spam bots, you need JavaScript enabled to view it . We will then present the evidence to Ofcom.  The more you can send the better.  Ofcom heard the dealers side with the IMPDA on cashback, and the dealers views were taken and our suggestions incorporated into the general condition, now Ofcom will hear from the IMPDA and dealers about claw backs, how they are applied, for what, and how its affecting dealers up and down the country.  Once again the dealers are to be heard, so we need you now to help us put your case by sending us what you have.  For too long dealers and distributors have suffered claw backs, now we have the chance to make a change.