Australia approved new consumer protection rules designed to crack down on poor sales practices by requiring telecoms operators to promote and sell their products in a fair and responsible manner.
The strengthened Telecommunications Consumer Protections (TCP) code, passed by the Australian Communications and Media Authority (ACMA), requires operators to clearly explain key terms and conditions to enable consumers to make informed decisions, and to assess a customer’s capacity to pay.
ACMA chair Nerida O’Loughlin explained: “We see evidence of customers being encouraged to sign up to multiple plans which do not meet their needs, are excessive or beyond their financial capacity. The impact of this is serious, particularly for those in vulnerable circumstances, leading to financial hardship and denial of access to critical services.”
For new customers where the total cost of the contract exceeds AUD1,000 ($698), operators will require them to provide information about how they will pay their bill.
In addition, an external check from a credit reporting body will be required. These provisions will also apply to prepaid customers moving to post-paid accounts.
“The new TCP code puts the onus on telcos to ensure customers understand what they are buying. We will be subjecting telcos to close scrutiny as to how well their practices conform with the new code,” O’Loughlin said.
In a statement, ACMA said it will monitor and investigate non-compliance and test the effectiveness of the new rules. Repeated breaches of the code could lead to penalties of up to AUD10 million.
The new rules covering sales practices, financial hardship and credit assessment go into effect on 1 August 2019.Subscribe to our daily newsletter Back