Ofcom has confirmed that the sale of new rollover contracts, also known as Automatically Renewable Contracts (ARCs), which tie landline and broadband customers into repeated minimum contract periods unless they opt out, will be banned from 31 December 2011. The ban will apply to ARCs for landline and broadband services sold to residential and small business customers.  

Ofcom has also indicated that it will require communications providers to move all residential and small business customers currently on rollover contracts to alternative deals, and to completely remove rollover contracts from the market by 31 December 2012.

Ofcom’s evidence shows that ARCs raise barriers to competition by locking customers into long term deals with little additional benefit.