On 18th September 2019 the Italian Authority filed a proceeding for the alleged activities of “iban discrimination” and “geo-blocking” against Telepass S.p.A., a company controlled by Autostrade per l’Italia S.p.A. Indeed, when a foreign bank domiciliation is set, the registration to Telepass’ services fails, and the consumer cannot activate and use the same services. The alleged violation refers to the EU Regulation 260/2012 on “iban discrimination”, which prevents creditors from discriminating its clients on the basis of their bank domiciliation and the EU Regulation 302/2018 on “geo-blocking”, which limits or prevents the access to a website or provides different contents on the basis of the geographical position of the consumer. In the last year the Italian Authority has sentenced three Italian companies for similar practices and namely: Fastweb to an administrative fine of Euro 600.000, and Vodafone Italy and Wind 3 to an administrative fine of Euro 800.000.
Telepass was inspected by the Authority and by the Financial Police and fight back the accuses highlighting that just a few registration failed in the last 2 years (i.e. only 10 person out of 6M users) and that an alternative solution has been appointed and is already available (“Go By Telepass”). Moreover, Telepass has argued that it is a matter of identification, i.e. identification needed to validly and safely conclude the agreements and that is outsourced to the banking institutions that are going to benefit of the payments.
Telepass claims that there have been just 10 cases in two years, in which data provided were not enough for the identification (and this was due to the foreign iban number). On this identification matter, Telepass declared its willingness to collaborate with the Authority to find a reasonable solution; in the meanwhile, the company is appointing new and innovative ways of identification, such as the “dynamic selfie” and the identification through credit cards.
The issue may be better understood if considered also from the company’s background and from an economic point of view. Telepass is operating on the market in a natural monopoly condition (i.e. in Italy there are only few competitors) and has already been sentenced for anti-competition and violations practices of the Italian Consumer Code in the past (i.e. in 2016 Telepass was fined Euro 200.000 for having changed contractual conditions - by doubling the fees - without the consent of the consumers; nevertheless, the company immediately fixed the violation).
This particular situation makes the iban discrimination and the geo-blocking matters even worse, because the consumer is not even given the possibility to use the service at all, due to the fact that there are no competitors in the same sector which could provide the same or similar services.
The exception raised by Telepass stating and highlighting the low number of consumers affected by this practice, could be considered reasonable. Nevertheless, this cannot totally exclude the application of sanctions, given that the consumers are not only protected by competition and antitrust provisions in this case but by the more specific provisions set forth by the “iban discrimination” and the “geo-blocking” Regulations.
