Many mobile phone users are seemingly unaware of the pitfalls they face when their telecom service contracts are up for renewal or expiry.
At least two pitfalls have been commonly identified. First, if you allow your contract to lapse without renewal (nor termination) and continue to use the service, the regular standard rate will apply and you may be charged substantially higher than your monthly package fee during the contract period.
Second, as in most telecom service contracts, the billing date and the contract expiry date do not fall on the same date. And, even if you switch to another service provider on the same day as the expiration of the contract, you will be billed a full month's fee - not in proportion of the actual days of service.
Such charging practices by some telecom service providers have apparently propelled consumer complaints against telecom services to a high of 2,162 cases, an increase of 17% in the first 6 months of this year compared with the same previous period.
In a typical case, the complainant has been on a $60 monthly plan including the use of mobile data service. Her monthly bill for the period between April and May suddenly rose exorbitantly and included in the bill was a mobile data charge amounting to $898! She sought explanation of the telecom service provider.
The explanation was: her contract expired in March this year and as she had opted online before not to receive any advertising or electronic message, she was not notified of the expiry of her contract and the change in service.
Since the company did not receive from her any notification of service termination, she was kept on a basic plan that did not include the use of mobile data. In other words, mobile data was charged separately at a regular rate.
On conciliation of the Consumer Council, the service provider proposed to waive the mobile data charge of $898 by half on condition the complainant would agree to extend her contract for another 15 months.
In another case, the complainant notified his existing service provider, 2 months ahead of contract expiry that he would switch to another telecom supplier. He was told the switch would take effect on October 28, and on that date he took his mobile phone to the new service provider. He was at a loss when billed by the company afterwards.
It transpired that his billing date was on the 27th of each month, and the contract termination date was on the following date i.e. October 28 thus he had used only 2 days more, but the entire sum of the monthly fee ($63) was applied.
Despite conciliation of the Council, the company would not consider adjusting the fee proportionally to cover only the actual days of service and not the whole month. The complainant was advised to pursue his case through the Small Claims Tribunal.
Mobile data usage could be extremely costly if not packaged as part of a telecom service plan. In one case, the complainant's contract was due to expire on January 30. He was informed his renewed contract included 400?mb of free mobile data use. However, in his February statement, he found a mobile data charge of a high $898!
According to the telecom service provider, although the renewed contract commenced from January 31, the free mobile data service did not take effect until February 24: thus a gap of 24 days during which mobile data was charged accordingly.
The complainant insisted that the renewed contract clearly stated it covered the period between 31/1/2014 and 30/1/2015; it turned out that the commencement date of the free mobile data service was contained in the contract details accessible on the company's website.
Upon the Council's conciliation, the telecom service provider offered to reduce the $898 mobile data charge to $98, which was accepted by the complainant.
Invariably complainants involved in these cases claimed that they were not, clearly and explicitly, informed beforehand and were not aware of such charging practices by telecom service providers.
Telecom service providers, on the other hand, are reminded of the amended Trade Descriptions Ordinance (TDO) prohibiting unfair trade practices in particular in the offence of misleading omissions.
The Council has referred some of these cases to the Office of Communications Authority which has jurisdiction in the enforcement of the fair trading sections of the TDO in relation to the commercial practices of licensed telecom service providers.
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