Ofcom has fined BT £2.8m because subsidiaries EE and Plusnet did not provide more than a million customers with clear contract information before they signed up for a new deal.
Ofcom said: “The company broke our consumer protection rules designed to ensure telecoms customers get clear, comparable information about the services they are considering buying.”
For two years, phone and broadband companies have been required to give consumers and small businesses the details of a contract, as well as a short summary of its key terms before they sign up, including information such as the price and length of the contract, the speed of the service, and any early exit fees.
Ian Strawhorne, Ofcom’s Enforcement Director, added: “For people to take advantage of the competitive telecoms market here in the UK, they must be able to shop around with confidence.
“When we strengthened our rules to make it easier for consumers to compare deals, we gave providers a strict timeline by which to implement them. It’s unacceptable that BT couldn’t get its act together in time, and the company must now pay a penalty for its failings. We won’t hesitate to step in on behalf of phone and broadband customers when our rules to protect them are broken.”
Ofcom opened an investigation into BT after being told EE and Plusnet may have failed to provide these documents to some customers. An investigation revealed EE and Plusnet made more than 1.3 million sales in two years without providing the required contract summary and information documents.
“It’s unacceptable that BT couldn’t get its act together in time, and the company must now pay a penalty for its failings”
“The evidence shows there were at least 1.1 million customers affected by this. Ofcom engaged with providers during the period before the new rules came into force in June 2022, to ensure they were on track to meet the deadline. BT told us in February 2022 that it was confident the deadline would be met.
“Evidence we have gathered shows that BT was aware from as early as January 2022 that some of its sales channels would not meet the deadline. In some cases, BT deliberately chose not to comply with the rules on time. Other providers dedicated the resources required to meet the implementation deadline for these new rules, and BT is likely to have saved costs by not doing so,” Ofcom stated.
“In engagement with Ofcom, BT contacted 1.1 million customers between 26 June and 30 September 2023, explaining that it had not provided them with the information to which they were entitled. Those customers have been given the opportunity to request the information and/or cancel their contract without charge.
“However, before these communications were sent, some customers left BT before the end of their contract and may have been charged an early exit fee. Our rules are clear that if the required contract summary and contract information is not given, the contract is not binding on customers. As a result, an early exit fee should not have been payable by these customers.
Also, some sales channels are still non-compliant and BT is still not providing the required information at the right time to some customers. As a result of these failures, Ofcom has decided to fine BT £2,800,000, which reflects the seriousness of this breach.”
Ofcom has also told BT to identify and refund any affected customers who may have been charged for leaving before the end of their contract period, within five months. Within three months, BT must contact the remaining affected customers who are still with BT and have not already been contacted, to offer them their contract information and/or the right to cancel their contract without charge.
