Saturday, July 16, 2011

Hong Kong SAR - Consumer watchdog has attacked service providers for the complexity of contracts

[the standard] The consumer watchdog has blasted telecoms service providers for having contracts so riddled with exemptions to a so-called seven-day cooling-off period that the provision offers customers little protection.

Service providers have agreed on a joint code of practice to improve consumer protection.

It relies on self-regulation but the authorities may make it mandatory if necessary, Office of the Telecommunications Authority assistant director Danny Lau Kwong-cheung said yesterday.

The cooling-off period applies if contracts are signed during visits to customers' home. The period must be at least seven days and consumers can cancel the contract without incurring any payment liabilities.


However, "cooling off" does not apply in some cases.

For instance, the period becomes void once consumers accept promotional gifts. It will also cease to apply once the service has been provisioned or the provider starts installing the service.

Consumer Council chief executive Connie Lau Yin-hing said the cooling- off period should not be affected by the offer of gifts to customers.

"The aim of the cooling-off period is to allow consumers the opportunity to reconsider their decision on whether or not to use the service," Lau said.

"The exemptions show, in fact, that consumers do not receive enhanced protection."

She is also worried about information transparency and whether operators will accurately inform customers about all the cooling-off exemptions.

Operators are also barred from renewing contracts automatically and must get prior consent before raising charges.

The code is applicable from this month. Eleven major service providers, including PCCW and New World Mobility, have agreed to adopt the code.

The authority received almost 6,000 complaints last year over mobile or fixed-line services, 40 percent more than 2009. From January to May this year, it received 2,073 complaints.

Lau said contractual disputes accounted for more than a quarter of the complaints, including many involving consumers not being informed when service contracts are unilaterally extended.

Heat rises on telecoms cooling-off tricks

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