Telephone and broadband rollover contracts to be banned

Rollover contracts, also known as automatically renewable contracts (ARCs), roll forward to a new minimum contract period, with penalties for leaving, unless the customer actively opts out of the renewal.

On 13 September 2011 Ofcom confirmed that these contracts will be banned from December 2011. The ban will apply to ARCs for landline and broadband services sold to residential and small business customers.

Ofcom has set out a timetable for the removal of rollover contracts from the telecoms market, which takes account of systems changes that will need to be made by communications providers. The sale of new automatically renewable contracts to residential and small business customers will be prohibited from 31 December 2011. Ofcom will also 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.

Published on 16/09/2011