Telecoms consumer conditions: Ofcom cracks down on compliance

Ofcom has fined BT £2.8 million for the failure of its subsidiaries EE Limited and Plusnet Plc to comply with consumer laws. 

Following an investigation, Ofcom found that EE and Plusnet failed to provide some of their customers with contract information and a contract summary before they entered into a contract. In addition to a monetary fine, Ofcom ordered BT to (i) bring its services into compliance; (ii) refund customers that did not receive the required information and were then charged exit fees; and (iii) contact the remaining affected customers to offer them their contract information and/or the right to terminate without charge. BT has confirmed that it is in the process of contacting the affected customers. The full announcement is here.

The information requirements in question are set out in C1.3 to C1.7 of the General Conditions of Entitlement (GCEs), the regulatory conditions that all UK providers of electronic communications services must comply with, and came into force in 2022. These apply in addition to the pre-contractual information that all traders must provide to consumers when offering goods, services or digital content online to UK consumers under the Consumer Contracts (Information Cancelation and Additional Charges) Regulations 2013 (CCRs). 

While there is a significant amount of overlap between the information that providers of electronic communications services must provide to consumers under the two regulatory regimes, the GCEs also add stringent requirements as to how the information must be provided. For example, the contract information must be provided in a durable medium before a contract is entered into and if this is not feasible, the contract information must be made available in an easily downloadable document and the attention of the consumer must be drawn to the importance of downloading such a document. 

Providers of electronic communications services should consider this enforcement action as a warning shot from Ofcom, as non-compliance with these information requirements is widespread in the industry. The full confirmation decision has not been published yet, but we hope that it will provide further guidance on best practices for compliance. One point to note is that C1.6 provides that the contract will only become effective once the customer has given their express consent after receiving the contract summary. On this basis Ofcom could have gone further and held that no contracts were in place at all as between EE and Plusnet and their affected customers. Until we see the full confirmation decision we won’t know Ofcom’s broader thinking on this point, but no doubt providers will be checking their customer journeys are fully compliant to reduce their risk of fines and/or contract terminations.