Consumer Rights Act 2015 Could Aid Clarity on Broadband Prices

The new Consumer Rights Act 2015 has today been officially introduced and, while most of its measures are focused on “goods“, there are a few changes that will affect consumer “services” like broadband, mobile and phone connectivity in the United Kingdom.

Broadly speaking much of the act, which replaces the ‘Sale of Goods Act‘, the ‘Unfair Terms in Consumer Contracts Regulations‘ and also the ‘Supply of Goods and Services Act‘, centres on expanding the role of consumer rights into the digital world (e.g. you will now be able to claim a refund on faulty digital goods like ebooks, video game downloads or apps etc.).

But the act also covers “services” (Chapter 4) and this is the area where broadband, fixed line phone and mobile providers will need to be most mindful because it introduces a number of key changes and protections. It also puts pressure on providers not to adopt unfair contract terms.

Broadly speaking the act seeks to ensure that services are performed with reasonable care and skill, done for a reasonable price and provided in a reasonable time. But if that doesn’t happen then there are new protections in place to help you seek a remedy, although the provider must first be given a fair chance to resolve the problem.

Consumer Rights Act – Key Changes for Services and Contracts

* Key terms of a contract, such as price or exit charges, must now be shown in a prominent and transparent way. In other words, consumers can use the law to challenge ISPs if they attempt to “bury” fees or charges in the small print (we can think of a few providers that might get into trouble here due to convoluted small print).

* The unfair terms test, which is used for our example of price and exit charges above, can also be used to challenge any terms that may limit your legal rights or which are deemed excessive or disproportionate.

* The provider must deliver the service within a reasonable period of time and refunds must be offered if they can’t. Alternatively if the service can be delivered, but not in a reasonable period of time or without causing significant inconvenience, then a price reduction of up to 100% of the cost may be claimed.

In the communications field most of these disputes will probably be settled – assuming the provider isn’t willing to help – when or if you take the complaint to an Alternative Dispute Resolution (ADR) provider, such as CISAS or Ombudsman Services (more details on those), or the Small Claims Court. The new law also gives Ofcom new grounds to act if they feel that ISPs aren’t complying.

The rules represent a mild improvement, not least because previously the fairness test didn’t apply to prices or other charges that might be hidden inside small print. But it remains to be seen how the market will adapt and often change doesn’t happen until Ofcom makes an example of somebody.