Strengthening Protections for Wireless Consumers

Backgrounder

Strengthening Protections for Wireless Consumers

Ministry of Consumer Services

Ontario intends to introduce new legislation that would, if passed, create new rights for cell phone and wireless contract consumers.

Full Disclosure of Goods and Services

The legislation would, if passed, help consumers understand exactly what they are contracting for.

  • Providers would need to clearly explain which services are included and which would result in added costs, how services can be accessed, and what rates and restrictions apply (for example, if a long-distance plan is within Ontario only)
  • Contracts would need to include the retail value and the actual cost to the consumer of phones provided free or at a discounted price
  • Suppliers would be obligated to disclose manufacturer's warranty information on a phone if the supplier offers supplemental warranty coverage
  • Information on how cancellation fees are calculated would have to be included in the agreement
  • Companies would have to provide clear information on how roaming costs are calculated and when they will be incurred, and whether a cell phone is locked, for how long, and the cost, if any, to unlock it

Comprehensive, Easy-to-Understand Agreements

The proposed legislation would, if passed, ensure contracts include clear disclosure of key terms consumers can understand. Companies would have to provide an agreement in a form that a consumer can keep, such as an electronic document that can be printed.

If a copy of the agreement is not provided to a consumer at the time it is signed or the company does not make all the disclosures the legislation requires, including all the key terms of the contract, a consumer would have the right to cancel the agreement within one year of signing and the company would need to refund all payments made under the contract to the consumer.

Consent

The proposed legislation would, if passed, require companies to have a consumer's consent if a fixed-term contract is to be amended, renewed or extended. This means consumers would have to agree to any change to the agreement before it is made.

Automatic contract renewal of a fixed-term contract would no longer be allowed. Consumers would be protected against loss of service by permitting fixed-term contracts to become month-to-month contracts on the same terms of their expired fixed-term contract. Consumers would receive copies of all amended or renewed agreements.

All-Inclusive Pricing

Under the proposed legislation, wireless services providers would have to include the total cost of an agreement in any price advertisements so prices are transparent. This means that the all-inclusive cost would need to be the most prominent price information shown in the advertisement.

Cancel Agreements at Any Time With Caps on Cancellation Fees or No Fee at All

The proposed legislation would, if passed, give consumers the right to cancel a wireless services agreement at any time by giving notice to their provider. The cost to cancel would depend on the type of agreement.

Type of contract

Is cell phone provided free or at a discount?

Cancellation Charge

Month to month

No cell phone provided


$0 maximum.

Cell phone provided free or at a discount

Customer could be required to pay back a proportion of the value of the discounted phone; e.g., the consumer gets a cell phone valued at $200 for free, for a one-year contract.  If cancelled after six months, the consumer would need to pay $100.

Fixed-term

No cell phone provided

10 per cent of price of outstanding services up to $50 maximum.

Cell phone provided free or at a discount

Customer could be required to pay back a proportion of the value of the discounted phone; e.g., a $500 phone provided at $100 ($400 discount), for a one year term, the cancellation cost would be calculated based on the time remaining in the agreement. If cancelled after three months, the consumer would owe $300.

Unacceptable Billing

Under the proposed legislation, consumers could not be charged for services they could not access because their hardware was being repaired while under warranty. If a customer received a loaner phone while their phone was being repaired, the loaner phone would need to be provided free-of-charge. This would not apply to phones that are not covered by warranty.

Protection Against Wrongful Billing

The proposed legislation, if passed, would see no charges billed to a customer for use of a lost or stolen phone after the reported lost or stolen date.

Media Contacts

  • Bryan Leblanc

    Minister's Office

    bryan.leblanc@ontario.ca

    416-326-1939

  • Sandra Bento

    Media Relations

    sandra.bento@ontario.ca

    416-327-9708

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