DLA Pipers Group Litigation Order (GLO) against HMRC which was approved by the High Court in July will challenge HMRC for VAT that is still being withheld from mobile phone and CPU traders on the basis of ?non-economic activity a HMRC policy that was defeated in the Bond House case in January.

Around 150 traders still have VAT withheld by HMRC on the grounds of non-economic activity.

HMRC introduced its extended verification policy following the Bond House defeat in the ECJ to withhold VAT repayments while it investigated VAT fraud in a supply chain. Traders are now considering suing HMRC for damages via judicial review in the administrative court on the grounds that the decision to engage in extended verification or the time taken to carry out the process is unreasonable.

DLA Piper is considering incorporating claims for damages under extended verification in its current GLO which would significantly increase the number of claimants and the size of the claim.

DLA Piper solicitor Simon Airey said: We are considering whether and to what extent the extended verification policy can also be used to justify claims and damages.

Around 50 traders have so far registered interest in the GLO. Traders have six months to join the class action.

Both 3 and Data Select played down the move.

3 restated its campaign to clamp down on fraud and bad debt last month following unremarkable half-year results that showed high churn and below-average ARPU. 3 has increased the rigidity of its credit-checking system and is monitoring its distribution channels more closely.

Eric White group marketing manager at Data Select parent company Phones International said:

Data Select is working closely with its network partners to achieve the highest possible quality of connections. Our focus is to manage dealer relationships as diligently as possible and review their connections activity on an ongoing basis to ensure they meet the quality requirements set out by the network. This is simply day-to-day business as usual.

Where issues are identified we will work with the dealer to try and get them back on track assuming the inclination and enthusiasm is there on the dealers part. As a result of this process we have recently ceased trading with a handful of dealers who operate in the distance reselling marketplace and who do not meet these standards.

A 3 spokesman added: The move ties in with the strategy we outlined last year. All of our channels and partners are reviewed on a monthly basis to investigate the type of business they are putting through.

One distributor source said: This goes on week-in week-out. The networks want better quality and they have moved to cut out the bad dealers. They are evaluating it all the time.

Following weeks of severe delays in Oranges online registration system Enable dealers have resorted to connecting customers via its telephone registration service Telereg. Oranges telesales staff have been offering to connect customers to its free broadband packages over the phone while they are signing to its post-pay tariffs in store with dealers.

Dealers are not being paid any commission for the broadband connections but view it as a useful sales tool to lure new customers.

One dealer said: Ive signed up seven customers in the last week. Orange staff now connect as soon as I ask. It helps sales.

Orange was unavailable for comment.

NEC contacted all UK operators last week to inform them of its decision. It will honour existing supply contracts but will not launch new products or seek new supply deals for at least 12 months.

UK MD David Payette who joined NEC from Avaya a year ago called the move a hiatus so NEC could reassess the European market to better cater to the demands of network operators.

He said: It is a streamlining exercise and there will be a hiatus from new business directions for about 12 months while we re-examine our position in the UK and Europe. We will look at profitability product sets and market features wanted by the network operators.

The mobile device arena is extremely price-competitive and there has been a period of consolidation and commoditisation. The Japanese cost of production has not been ideally suited to the European market. Most of our relationships in the UK and Europe have not been sustained through the handset arena but through infrastructure and support of new network technology. That is where we will continue to focus.

According to sources close to the situation there will be around 31 redundancies at the company as a result. Payette said the number would be closer to 20 and that NEC would attempt to redeploy staff elsewhere within the corporation.

About 20 roles will be impacted but NEC is a large corporation so there should hopefully be opportunities to redeploy staff said Payette.

NEC was the first handset manufacturer to produce 3G phones which 3 took to launch the network in March 2003. Motorola Nokia and LG were soon competing in the 3G space as well however and NEC launched its last 3G model the NEC e338 in November 2004.

Refurbished NEC handsets still appear in the channel on pre-pay but the 3G market is dominated by the major handset manufacturers now. NEC has turned out GSM models in the meantime almost unnoticed.

One distributor source said: It is probably overdue. It has no footprint at all. It initially had a semi-exclusive deal with 3 but that has run its course and NEC hasnt launched a 3G handset for a long time.

Instead of having to wait every two weeks for news that matters about the mobile phone industry you can now get the news as it happens. Log on to www.mobilenewscwp.co.uk for the hot stories of the day.

Customers can now access Orange TV via the Orange World portal instead of having to download an application making the service compatible with 13 different 3G handsets. Orange has also added new channels including Eat Cinema My Movies British Eurosport FHM TV and Aardman Animations.

Also the service is now available at a broader range of contract price points: the GBP10 per month ?max pack offers all channels and 20 hours viewing time; the GBP5 ?music pack offers three music channels; and the GBP5 ?mix pack offers a cross-section of the channels available.

Orange head of sport and multimedia operations said: The key difference now is its reach. We have opened it up to a host of new handsets so many customers will be able to access Orange TV. A 24-hour free trial of the service is available.

Law firm Halliwells is preparing to take up two cases against HMRC citing abuse of process. Halliwells Head of Indirect Tax Chris Chipperton said: Our customers are getting hit with massive personal tax demands. Customs have said to these people that theyll offset those payments against their VAT repayments. This is not the usual practice – it is an abuse of process on HMRCs part. Its unfair to the trader.

We are proceeding with our expansion of our stand-alone stores as previously announced but the properties in The Link portfolio are not of interest to us at this stage said a Virgin Mobile spokesperson.

Mobile News understands that the locations available and the terms of purchase do not fit with Virgin Mobiles retail strategy and that it is unlikely to pursue any of them.

3 and T-Mobile as well as other indirect mobile retailers remain contenders after Orange snapped up 47 stores from O2 the new owner of The Link last week.

An O2 spokesman said: As well as the Orange agreement which we have in principal we are in advanced negotiations with other potential purchasers. We are confident that those will conclude ahead of the completion of the transaction with DSG which will be announced by October. Additional deals will be announced ahead of that date.

Orange will increase its high street presence to more than 340 stores after its agreed a deal in principle to acquire up to 47 new shops from O2.

The new stores will take Orange into 19 new towns where it currently has no presence and will increase its coverage in others. Of the 47 stores 36 are former The Link stores and 11 previously traded as O2. As part of the deal Orange plans to take on around 250 former The Link staff.

Orange said it will refit the new stores to trade under the Orange brand in the run-up to Christmas. This will be followed by a major refresh to position the companys retail operation as a combined mobile fixed broadband and TV provider proposition.

Orange vice-president of sales Mike Newnham said: 2006 has been a year of consolidation and building for the future and our retail strategy has been a major part of that. Were now planning to expand our footprint across Britains high streets to give our customers a taste of what the new Orange is all about.

3 has announced today that it has bought 95 retail stores in shopping
centres and high street locations across the UK from O2 and The Link.

Under the agreement 3 will obtain 73 Link stores and 22 O2 stores. This is a continuation of 3s strategy to build a nationwide retail presence of over 150 stand-alone stores and 133 Superdrug and Selfridges concessions by the end of 2006.

3 expects over 90 of the new stores to be selling its products and services by the end of 2006. Stores will be re-branded refurbished and converted as 3Stores.

All permanent employees at the 73 Link stores will transfer to 3 and will start work immediately. All O2 store staff will continue to work for O2.
There will also be 200 new jobs created within the 3 retail network.

Marc Allera Sales Director of 3 UK says: Were confident we can turn
these sites into 3Stores in a matter of weeks. Most of these stores will be open in time for the busy Christmas period.

This agreement ensures we have a balanced mix of distribution. With
specialist independents and the major third-party retailers continuing to play a major role in how we attract customers we expect our direct presence to become equally important to winning new business during 2007.

The terms of the agreement were not disclosed.