Ofcom rules you can now opt out of mobile contract price rises

[Michael Browne]

Consumers and small businesses should be allowed to exit their landline, broadband or mobile contract without penalty if their provider increases the cost of their monthly deal, Ofcom announced today.

 

Ofcom is telling providers how to interpret and apply current telecoms sector rules2 in relation to price increases during fixed-term contracts. Ofcom is also confirming the cancellation rights it expects providers to give consumers following price increases.

 

This Guidance sets out that:

 

• Ofcom is likely to regard any increase3 to the recurring monthly subscription charge4 in a fixed-term contract as ‘materially detrimental’ to consumers;
  

 

• providers should therefore give consumers at least 30 days’ notice of any such price rise and allow them to exit their contract without penalty; and
  

 

• any changes to contract terms, pricing or otherwise, must be communicated clearly and transparently to consumers.
  

http://media.ofcom.org.uk/2013/10/23/protection-for-consumers-against-mid-contract-price-rises/

[dpick]

I think this could be why some like O2 are now splitting there contracts in two first part to pay for the phone and second part to pay for the actual mobile calls and data etc.

 

Example IPhone 5s £0 today then £25 a month for 24 months with Unlimited text and minutes and 4 gb data is £27 a month Total £52 a month

 

dpick

[johnjordan]

I have just upgraded my phone with a new contract. I paid £200 up front for the phone and £26 a month. Presumably the £26 covers the cost of the balance owing on the phone, which costs in excess of £600, and the cost of the calls, text and internet.

 

How would I stand if the charges were increased? Surely I cannot just cancel the contract without penalty as the monthly payment covers part of the cost of the phone.

[MaxxPower]

I suppose it's possible that the provider could ask for the return of the handset since it hasn't technically been entirely paid for, though in that case they should also have to provide a partial refund as well. Whatever you have paid towards the handset cost minus a small amount for the time you've had it.