Cell Phone Providers Forced to Make Contracts Fair

The Manitoba government is sticking up for consumers when it comes to how cell phone companies portray contract terms.

Last December, the province asked for input from the public on amending the Consumer Protection Act that would make cell phone and texting contracts easier to understand.

“Manitobans have told us they are frustrated by high cancellation fees, unilateral changes to contract terms and prices, hidden charges and complex and unclear contracts,” said Family Services and Consumer Affairs Minister Gord Mackintosh. “They have asked for greater fairness and the ability to make informed choices and this legislation will make that happen.”

The new rules that take effect in 2012 include seven protections:

  • Allow cell phone customers to cancel contracts before the end of term;
  • Prohibit unreasonable cancellation fees, while allowing cost recovery for equipment provided or subsidized as a contract incentive;
  • Stop charges for service that can’t be accessed due to damaged or defective equipment, unless the customer is responsible;
  • End unilateral amendments to a material element of a contract if the change doesn’t benefit the customer;
  • Require the minimum monthly cost to be included in advertisements;
  • Require companies to fully disclose and explain all charges and terms; and
  • Limit automatic contract renewals.

The new rules come after responses from about 250 consumers, as well as consultation with Quebec, the only other province with similar legislation.

Companies who don’t comply to the new legislation could be fined from $1,000 to $5,000 per breach, or under the Consumer Protection Act with a fine up to $300,000.


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