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January 3, 2013

Ofcom starts consultation on mobile price hikes

Latest consultation closes on 14 March 2013.

By CBR Staff Writer

Ofcom has started a consultation on ways to protect consumers against fixed contract price rises for landline, broadband and mobile services.

The regulator’s proposed approach would enable customers to leave their contracts without penalty if providers increase costs during the term of the contract.

Ofcom said that it would expect providers to be clear and upfront about the potential for price increases and of the consumer’s right to cancel the contract in the event of any price increase.

The regulator considered a complete ban on price rises in fixed contracts, but said it would be inconsistent with the European legal framework.

Last year, Ofcom launched a review which looked at 1,644 complaints about changes to terms and conditions about contracts.

Ofcom consumer group director Claudio Pollack said: "Many consumers have complained to us that they are not made aware of the potential for price rises in what they believe to be fixed contracts."

"Ofcom is consulting on rules that we propose would give consumers a fair deal in relation to mid-contract price rises," Pollack said.

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The latest consultation closes on 14 March 2013 and Ofcom expects to take a decision in June.

Ofcom said: "This proposed change would address consumer concerns that it is unfair that providers are currently able to raise prices, while they themselves have little choice but to accept the increase or pay a penalty to exit the contract."

In November last year, Ofcom unveiled proposals for a framework that allow ‘white space’ devices to be used in the UK.

The use of ‘white spaces’, which exist in-between frequency bands that have been reserved for TV broadcasting, would allow new devices to transmit and receive wireless signals for applications.


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