Ofcom to protect against mid-contract price rises

Industry regulator clarifies rules allowing consumers to exit mobile, landline and broadband contracts if prices are increased

Consumers and small business will be able to exit their mobile phone, landline or broadband contracts early without penalty if their provider puts up prices, Ofcom has today confirmed.

Ofcom added that customers must be given 30 days’ notice of any increase to their monthly subscription, even if it is in line with inflation. Customers will then be given the option to leave their contract penalty-free.

Although there are no specific rule changes involved with the announcement, providers had previously interpreted the regulations differently.

Ofcom research has also found that some consumers were hit by mid-contract price hikes without sufficient warnings when they signed up to their deal.

The new guidelines, which come into effect in three months’ time, are expected to make it clear to providers how they should behave, and encourage competition.

Ofcom consumer group director Claudio Pollack (pictured) said: “Ofcom is today making clear that consumers entering into fixed-term telecoms contracts must get a fairer deal. We think the sector rules were operating unfairly in the provider’s favour, with consumers having little choice but to accept price increases or pay to exit their contract.

“We’re making it clear that any increase to the monthly subscription price should trigger a consumer’s right to leave their contract – without penalty.”

Source – Mobile News 23-10-13