Given high inflation and ongoing pressure on consumer finances, regulators will be paying close attention to in-contract price rises
Eircom failed to alert customers of price rises in due time: On 22 July 2022, ComReg – the Irish telecoms regulator – issued a notification of a finding of non-compliance to Eircom in respect of its obligations under the country’s Universal Service and User’s Rights Regulations. Specifically, the finding concerned Eircom’s non-compliance with provisions relating to contract change notifications. According to ComReg, the operator did not alert some of its customers of a proposed price increase to their contracts at least one month prior to the changes taking effect and did not give those customers the right to withdraw without penalty from the contract if they do not accept the modification. In line with the rules, Eircom has since notified these customers of the price uplift to their contract and offered them the right to withdraw, and has also refunded those customers that were charged the increase prior to any notification.
European regulators have acted to support consumers and switching: During the course of a broadband or mobile contract, an operator may wish to adjust the terms and conditions of its service, including changes to tariff prices, call rates and international roaming charges. According to regulation in Ireland, operators are required to make customers aware of any changes to their contract (on both price and other terms and conditions) by giving 30 days’ notice. Operators must also advise their customers of the option to cancel the contract immediately and without penalty if they do not accept the proposed modification. As our research indicates, such contract rules are now commonplace across Europe as regulators have sought to encourage switching and drive market competition. Measures have been strengthened over time to further protect consumers and minimise the occurrence of (and the harm caused by) ‘bill shock’.
Future in-contract price rises will face scrutiny: Given the ongoing cost of living crisis, governments and operators in many countries are looking into how they can do more to help consumers cope with mounting pressures on their finances. In the UK, for example, a number of providers (including BT, Hyperoptic and Virgin Media) are offering discounted social tariffs for connectivity. Regulators in some other countries, such as Belgium and Portugal, have even stepped in to mandate such tariffs in order to support and drive adoption among low-income groups. Amid a challenging macroeconomic climate and rising prices, consumer protection will remain high on regulators’ agendas, particularly with respect to above-inflation, in-contract price rises. Though these annual uplifts are often permitted and made clear to subscribers at sign-up, transparency and communication will be key to help customers budget and to stave off future regulatory intervention.
Source: https://www.comreg.ie/comreg-notified-eircom-of-non-compliance
