After months of investigation and last ditch attempts to put the matter behind it, on 18 July eircom managed to agree an out-of-court settlement with ComReg.
As reported in our previous ezine, on 6 May 2014 ComReg issued an Opinion of non-compliance with Regulation 25(6)(b) of the Irish Universal Service Regulations 2011 (SI 337 of 2011) to eircom as a result of eircom’s contract termination procedures. ComReg raised concerns regarding a number of aspects of eircom’s procedures (such as the requirement to speak to the customer retention or ‘Save’ team before leaving) which ComReg considered acted as a disincentive for customers wanting to change service providers.
eircom was initially given 21 days in which to bring its contract termination conditions and procedures into compliance. Following a request from eircom, the deadline was extended first by a couple of weeks until 17 June 2014, and then by a further nine days until 26 June 2014. The purpose of the two extensions was reportedly to enable eircom and ComReg to enter into and continue discussions to resolve the issue in an out-of-court settlement. Clearly it was in neither party’s interest to incur additional time and expenses that would arise from court proceedings. The pragmatic approach taken by ComReg in trying to avoid taking unnecessary court action sends out a welcome signal to those in the Irish telecoms market that when things do not go right, it may still be possible to sit down with the regulator and work things out.
Following the settlement, eircom will no longer be able to:
- Charge customers a penalty for failure to provide notice of their intention to change service provider – provided of course, this is outside their minimum contract period
- Apply disaggregated bundle charges for the final bill when the customer is switching provider
- Engage in ‘Save’ activity with a customer wishing to leave eircom eg, by making the customer speak to a retentions team
eircom has set up a refund process for affected customers. Complaints will be treated in two separate groups (i) “existing complainants” ie, those who complained after 11 March 2011 – these customers will obtain a full refund from eircom; and (ii) “other affected consumers” ie, anyone complaining between 18 July and up until 10 October 2014 – these customers will be entitled to a limited fixed refund.
The terms of the settlement are confidential to both parties, so we do not know if eircom also had to make a ‘goodwill’ payment to ComReg or make any other concessions. However, eircom is not entirely out of the woods. ComReg will be monitoring implementation of the changes under the settlement and has stated that it “will take all necessary enforcement in respect of any such activity”. eircom will therefore need to ensure that staff are fully briefed on the changes to avoid a repeat with ComReg.