TENS of thousands of consumers may be entitled to refunds after Hong Kong's largest independent international phone company admitted it had sent out advertising that could be misleading. Customers making calls to the US, Canada, United Kingdom and Australia were charged rates three times that in promotional literature. City Telecom (Hong Kong), which has more than 350,000 customers, has started offering customers who complain a reduction in their bills - but not as low as the rock-bottom rates in its literature. The company sent its customers a leaflet at the end of October which appeared to announce that during November calls to the US and Canada would be charged at 99 cents a minute and calls to the UK and Australia would be charged at $1.99 a minute - the lowest rates on the market. In fact, when they received their bills in December the calls were charged at $2.99 for North America. Calls to Australia were charged at $6.10 and the UK at $6.60. 'We didn't set out to make them think the rate would be 99 cents a minute,' said a company spokesman. 'It's just the design.' Complaining customers include one Tsuen Wan resident whose $4,949 bill would have been $1,638 if the rates in the brochure had been used - a difference of $3,300. 'Knowing that the calls were 99 cents a minute I made many more calls,' she said. On her first complaint the company offered a 10 per cent cut in the bill, then offered to charge a rate of $1.78 a minute to the United States. 'If the ads sent out by CTI were not intentionally deceiving, why would it want to settle my case by offering two new rates? What about the other customers who have never complained?' she asked. During October the company ran a customer poll, asking which of various discounts they preferred. The promotional literature included all the discount rates but did not state that only the discounts to China would take effect. The CTI spokesman said that to show 'goodwill' towards customers who had 'misunderstood our promotional material' the company was prepared to make an 'adjustment to the bills'. Consumer Council spokesman Kenneth So Wai-sang said the customers' case appeared strong. 'An advertisement is part of the contract,' he said. 'If they make a mistake they have to bear the consequences.' Complaints about telecommunications to the Consumer Council have risen sharply in recent years as new companies set up and competition intensifies.