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Ofcom's Statement On Mid-Contract Prices Rises

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With longer contracts becoming more common place, it's important for consumers to know their rights with regards to price increases during their fixed term contract.

General condition 9.6 states the Communications Provider shall:
(a) give its Subscribers adequate notice not shorter than one month of any modifications likely to be of material detriment to that Subscriber;
(b) allow its Subscribers to withdraw from their contract without penalty upon such notice; and
(c) at the same time as giving the notice in condition 9.6 (a) above, shall inform the Subscriber of its ability to terminate the contract without penalty if the proposed modification is not acceptable to the Subscriber.

This applies to fixed line, mobile and broadband fixed term contracts.

A recent statement from Ofcom with regards to price rises in fixed term contracts offer guidance to service providers about how they are likely to interpret general condition 9.6. This guidance says that;

  • Any increase to the monthly subscription charge in a fixed-term contract is likely to be considered as materially detrimental to consumers;

  • service providers should give their customers thirty days' warning of any price rise and permit them to end their contract without any penalty;

  • customers should clearly and transparently be notified of any changes to contract terms and pricing.

Ofcom's statement follows a consultation on how to provide a fairer deal for the consumers that may face fixed term contract price rises.

Consumer Group Director, Claudio Pollack said: “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.”

The guidance does not affect non price related changes to contracts. Ofcom would consider any changes to inclusive bundles such as minutes, texts and data in lieu of an increase in subscription fees as a price change and therefore subject to the same consumer rights.

To see Ofcom's full statement, click here

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