Telecos to amend customer contracts

19 July 2011

South Africa’s four big mobile phone operators and two landline providers will have to have new customer contracts that are compliant with the Consumer Protection Act in place within three months, according to Business Report on Monday.

This came as national consumer commissioner Mamodupi Mohlala prepared to sign consent order agreements this week with each of the companies. These agreements are legally binding and a fine of R1-million or 10% of annual turnover could be imposed if they were breached.

Mohlala said that over the past two weeks the commission had reviewed all contracts provided by the individual companies and that none of the contracts were compliant with the Act. This, despite the fact that it had been in the pipeline for the past five years and its implementation was postponed from September last year to April this year.

She said that in most cases about 75% of the cellphone contract terms and conditions would have to change.

Companies would have to change their billing systems, marketing approach and their staff would have to be educated and more skilled, which would require more spending on human resources, she said.

“There is nothing untoward … we are aligning South Africa with international best practice.”

Mohlala said Cell C, Telkom and 8.ta would have their contracts amended by the end of September, Neotel by next month and MTN and Vodacom both expected to have amended their contracts by the end of October.

Sapa