i3forum contractual fraud clauses Katia González Head of Fraud Prevention BICS, Chair i3F Fraud Group GSMA FASG#10 - February 2018

Agenda What is i3Forum Approach to fight fraud Contractual proposal

Mission at the service of the carrier community What is i3Forum ? Founded in 2007 Represents the international wholesale carrier industry with 28 Tier1 carrier members globally Mission at the service of the carrier community Vision and education Foster innovation and transformation, Representation Carrying 75% of the worlds international traffic Partner with industry bodies: GSMA, Global Leaders Forum Mission at the service of the carrier ecosystem Vision and Education : explore upcoming transformations, opportunities, challenges Foster Innovation and Transformation : shape and promote key enablers, share best practices Representation : represent the Carrier Industry in discussions with other bodies

i3Forum working groups Actif since 2011 Operational cooperation IMS interconections: Technical, operational and business angles Working with GSMA NNI interface definition End-to-end Service Interoperability Business models for IMS interconnections Transition to IP/ IPX : Self-Certification Tool Kit” initiative Network Functions Virtualization : Whitepaper on Operational impacts of NFV for Carriers Internet of Things : Whitepaper analyzing the IoT eco-system, Carriers’ position, impact for carriers Unified Communication : Whitepaper on UC evolution Fight against Fraud Actif since 2011 Operational cooperation Best practices Contractual guidance *Katz y Callorda 2015. *Medido por el índice de popularidad desde una tasa inicial del 30% **Qiang et. Al (2009) World Bank

i3Forum approach to fight fraud INDUSTRY CHALLENGE COMPREHENSIVE i3Forum guidelines Operators are responsible for securing their networks from exposure to fraudulent use Possible to raise disputes in case of fraud Withholding payments may be accepted Makes sense from a fraud scenario perspective There is a direct financial impact on fraudsters All the downstream suppliers accept to withhold payments Documentation Timely An industry wide approach where both MNOs and wholesale carriers collaborate is key International fraud impact remains damageable to the Industry: 60% (-10% vs previous survey) equivalent to 17,3Bio USD FINANCIAL IMPACT ADOPTION Negating the fraudsters revenues is currently the most achievable way to have a negative impact on them / deter them from It is key that all industry partners play a fair game : timely, fair conditions, fair process while each party keeps its own responsibility Fuente: GSMA

i3F Contractual clauses for fraud Definition List of fraudulent behaviours It indicates the minimum key elements: failure to collect from the end user is not a reason to not pay the Service Providing Party; evidence needs to be provided to support a fraud dispute; if the Service Providing Party cannot obtain a credit note from its supplier then the amounts are considered due and the Service Receiving Party needs to pay. In case of a fraud dispute situation, the burden of the proof and allegedly fraudulent traffic analysis is the responsibility of the Service Receiving Party. The Service Receiving Party is ultimately responsible for all traffic sent.

i3F Contractual clauses for fraud Liability & payment rules No payment due is contingent on either Party customers payment No obligation to establish a CN if the other Party cannot collect from end users It indicates the minimum key elements: failure to collect from the end user is not a reason to not pay the Service Providing Party; evidence needs to be provided to support a fraud dispute; if the Service Providing Party cannot obtain a credit note from its supplier then the amounts are considered due and the Service Receiving Party needs to pay. In case of a fraud dispute situation, the burden of the proof and allegedly fraudulent traffic analysis is the responsibility of the Service Receiving Party. The Service Receiving Party is ultimately responsible for all traffic sent.

Right to suspend the service i3F Contractual clauses for fraud Right to suspend the service The Service Provider may suspend terminating traffic to certain dial codes / numbers in the event that it suspects or has likely evidence of fraudulent use of such traffic Liability & payment rules No payment due is contingent on either Party customers payment No obligation to establish a CN if the other Party cannot collect from end users

Right to suspend the service i3F Contractual clauses for fraud Right to suspend the service The Service Provider may suspend terminating traffic to certain dial codes / numbers in the event that it suspects or has likely evidence of fraudulent use of such traffic If fraud is detected… Prompt notification & CDRs Notification if fraud traffic Dispute opens at invoice receipt Supporting documents provided before invoice due date Liability & payment rules No payment due is contingent on either Party customers payment No obligation to establish a CN if the other Party cannot collect from end users

Right to suspend the service CN handling principles i3F Contractual clauses for fraud Right to suspend the service The Service Provider may suspend terminating traffic to certain dial codes / numbers in the event that it suspects or has likely evidence of fraudulent use of such traffic If fraud is detected… Prompt notification & CDRs Notification if fraud traffic Dispute opens at invoice receipt Supporting documents provided before invoice due date CN handling principles The Service provider will try to obtain a CN from the underlying suppliers Liability & payment rules No payment due is contingent on either Party customers payment No obligation to establish a CN if the other Party cannot collect from end users

Right to suspend the service CN handling principles i3F Contractual clauses for fraud Right to suspend the service The Service Provider may suspend terminating traffic to certain dial codes / numbers in the event that it suspects or has likely evidence of fraudulent use of such traffic CN handling principles The Service provider will try to obtain a CN from the underlying suppliers Liability & payment rules No payment due is contingent on either Party customers payment No obligation to establish a CN if the other Party cannot collect from end users If fraud is detected… The Service Provider may suspend terminating traffic to certain codes if it suspects fraudulent usage Notification if fraud traffic Dispute opens at invoice receipt Supporting documents provided before invoice due date Failure to collect from the end user is not a reason to not pay the Service Provider; evidence needs to be provided to support a fraud dispute; if the Service Provider cannot obtain a CN from its supplier then the amounts are considered due; the Service Receiver is ultimately responsible for all traffic sent and is responsible for the burden of the proof

Thank you