Ofcom: New rules for contracts and best deals
Customers will be told when their contract is coming to an end and be shown the best deals available.
Telephone, Broadband and Pay-TV customers must be warned when their minimum contract period is coming to an end, and be shown the best deals available, under new rules announced today by Ofcom.
Ofcom wants customers to get a fair deal and to be able to take advantage of the wide choice of communication services available. To help customers to do this, Ofcom is imposing these new requirements on Service Providers which will come into effect from the 15th February 2020.
The new rules will apply to both residential and business customers.
What's been decided and how it will work
End of Contract notifications
Mobile phone, Fixed line, Broadband and Pay-TV companies will be required to send a notification to their customer between 10 and 40 days before the end of their contract. The notifications can be sent by email, text or letter and must include specific information including:
• The current service details and price paid
• The end date for the current contract
• Any changes to the service and price paid at the end of the current contract
• Information about how to end the contract
Best Deal notifications
These notifications will tell customers about the best deals and tariffs available from their current provider, including prices available to other customers, such as new customers.
For companies and people who bundle the cost of their mobile handset as part of their minutes and data contract, the notification must include at least one SIM-only deal.
Out of Contract notifications
For customers who remain out of contract, a notification must be sent at least annually with information about their current service and the best deals and tariffs available for that service.
When does it happen?
The new requirements will come into effect on 15th February 2020, this allows time for Service Provider to implement changes to their systems and processes so that they can send out millions of notifications reliably and effectively.
Ofcom will be monitoring the impact of these new rules by collecting information from providers and conducting customer research.
Thoughts from TTNC
Although long overdue, we very much welcome these changes as we believe there are some companies whose business model revolves around locking people into contracts and making it difficult to switch to another provider.
There is one new rule that we particularly like as we feel it will have a significant impact; the rule requiring Mobile Phone companies to offer SIM-only deals to people who are paying for their Mobile handsets as part of their contracts. We think there are millions of pounds being wasted each month by people continuing to pay for a handset that they've effectively already bought.
