The ACCC finds concerning contract terms of having customers agree to terms that allow the business to change without their consent.

Australian Competition and Consumer Commission reviewed 11 telcos’ form of contracts and found 6 of the 11 to include terms that allowed the telco company to vary the contract which they announced was ‘unfair’.

Telstra and TPG both have altered the terms of the contracts as a result of this breach. The other telcos involved would not be realised.

They found that the specific terms of concern were the following:

  • Contract terms that allow the business to change the contract without consent from the consumer.
  • Terms that cause confusion about the agency arrangements that apply and that seek to unfairly absolve the agent from liability.
  • Terms that unfairly restrict the consumer’s right to terminate the contract.
  • Terms that suspend or terminate the services being provided to the consumer under the contract.
  • Terms that make the consumer liable for things that would ordinarily be outside of their control.
  • Terms that prevent the consumer from relying on representations made by the business or its agents.
  • Terms seeking to limit consumer guarantee rights.
  • Terms that remove a consumer’s credit card chargeback rights when buying the service through an agent.

Three of the above concerns were found within a TPG contract. Also found was a term that allowed the telco to change subscription fees charged to customers without providing notice. Also the right to suspend or disconnect a customer’s service at any time without notice, as well as another around limiting consumer guarantees.

“You must pay all subscription fees applicable to the plan for which you have registered. You understand that all fees and charges may be altered from time to time by us without notice, however, we will not increase the subscription fee for your plan until the end of the Minimum Contract Term,” the original contract stated, according to the ACCC report. –

TPG has now agreed to remove the three terms that are ‘unfair’. Also Telstra had the discretion to cancel or suspend services in the event of ‘excessive or unusual use’.

All telcos who have been reviewed to be ‘unfair’ had agreed to delete or amend 79 percent of terms.

The ACCC was going to consider launching court action against businesses who would not comply with the term changes, without disclosing any names.