Watchdog sets cooling-off guidelines for phone contracts

PUBLISHED : Wednesday, 03 February, 2010, 12:00am
UPDATED : Wednesday, 03 February, 2010, 12:00am

Customers should be able to cancel contracts with telecommunications companies within a seven-day cooling-off period, the industry's watchdog has proposed.

The Office of the Telecommunications Authority issued a new code of practice yesterday on the drawing up of service contracts. The new guidelines replace two similar codes issued in 2004.

New recommendations made by the office include the introduction of a cooling-off period, during which customers may cancel the contract without penalty.

Customers may also terminate the contract if there are changes in service quality or prices due to a change in contract terms. And when they choose to do so, the termination should be easy and convenient.

The code also states that telecommunications companies must not renew contracts automatically without the prior consent of customers.

'If the number of complaints about contractual disputes remains high, we will seriously consider whether other more stringent measures should be adopted,' a spokesman said.

Over the years, the number of complaints about telecoms services has usually topped the list of reports received by the Consumer Council.

It was No1 from 2006 to 2008, with a total of 9,759 complaints in 2008, even surpassing the 9,300 related to the Lehman Brothers minibond saga.

Two leading mobile phone operators, Smartone-Vodafone and CSL, said they would review the code.

A CSL spokeswoman said: 'We welcome all appropriate measures that are aimed at protecting customers and we constantly strive to ensure that our conduct is exemplary. We will consider joining the scheme.'

Other major operators, including PCCW, 3 Hong Kong and People, could not be reached for comment.

Industry veteran Charles Mok said the success of the new code would depend upon the participation of operators. He called for a trial period after which Ofta should conduct a thorough review.

'I believe some operators will join but it could take some effort to ensure compliance, especially for frontline sales,' he said.