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Namibian regulator shields consumers from "exploitative" MTC contracts

Namibian regulator shields consumers from "exploitative" MTC contracts

The Communications Regulatory Authority of Namibia (CRAN) has compelled Mobile Telecommunications Limited (MTC) to remove a clause in its subscription agreements that authorises automatic renewal of customer contracts without a lowering of the subscription fee.

According to the regulator, the action stems from an MTC customer complaint lodged two years ago about the clause found in the terms and conditions of MTC Standard Service Agreements.

Festus Mbandeka, Chief Executive Officer of CRAN says the regulator made a decision in favour of the customer in order to enforce its mandate which binds it to ensure all consumers are protected from exploitation and abuse in respect of prices, quality, variety of services and user equipment supplied.

"Owing to the fact that Clause 7 is in all MTC subscription agreements, CRAN resolved to treat this as a matter of public policy and in the best interest of the consumer. In view of its larger mandate of consumer protection, CRAN further resolved to engage MTC, which engagements gave rise to the following resolution by the Authority."

CRAN has ordered MTC to notify its subscribers in writing that their contract is lapsing on a specified date 30 days before it lapses and to also indicate to that consumer that he or she is entitled to extend the contract further with delivery of a new handset.

The decision does not apply to contracts that have already lapsed according to CRAN.

The regulator has barred MTC from continuing post-paid contracts automatically at the same fee to the consumer without delivering a new handset, as was the case in the clause that was reported to it.

Subscriber handsets

CRAN says because the price of the handset is always included in a subscription fee, where a subscription agreement is continued without a signed renewal (by MTC and the customer including the delivery of a new handset) then such an agreement is unlawful.

Subscribers must now be moved to a standard package with a reduced subscription fee without the inclusion of a handset in terms of CRAN's latest decision.

Katrina Sikeni, Head of Communications and external relations at CRAN says MTC has also been ordered to submit the standard packages to CRAN before 8 September for approval in terms of section 53 of Namibia's Communications Act, among other steps that have been communicated to the operator.

"During the first twelve months after the implementation of this decision, MTC must (also) provide the authority with quarterly reports indicating the customers whose contracts have lapsed and how such consumer contracts were managed in line with this decision."

Sikeni has also revealed that MTC customers can contact CRAN if the operator fails to address their cases relating to the outlawed clause within a period of 14 days after they formally report it.

CRAN is not the only regulator in the region which has moved to protect consumers.

The Independent Communications Authority of South Africa (ICASA) has made proposals for data expiration to be extended for up to a year.

South Africans have up to 19 September to comment on the proposed extension to data expiration through amendment of end-user and subscriber service charter regulations.

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