Cell C, South Africa’s third mobile operator, on Thursday accused rival mobile phone operators of “preventing customers from cancelling their contracts early by charging these customers excessive and unreasonable cancellation penalties”. By Staff Writer
“While the Consumer Protection Act (CPA) allows network providers to charge a reasonable cancellation penalty when customers wish to terminate their contracts early, Cell C has been made aware of certain instances where some of the network providers are charging customers more to cancel their contracts early than to stay in their contract for the full term. This means that customers who are unhappy with their current network provider and wish to move to Cell C have to pay for future services that they will never receive,” the company said on Thursday.
Cell C is dangling a whopping R10 000 reward to new customers who ditch contracts with Vodacom and MTN and sign up with South Africa’s third largest mobile service provider.
The R10 000 payment is expected to woo disgruntled Vodacom and MTN contract subscribers.
Cell C said rivals in some instances, customers are required to pay the full service or subscription fee for the remaining months of the contract plus an additional early termination charge to leave the network provider.
Regulation 5 of the CPA clearly specifies that “the cancellation penalty charges cannot be an amount which would have the effect of negating the consumers’ right to cancel a fixed term consumer agreement.” The right to cancel is one which is specifically afforded to all consumers in terms of the CPA.
While Cell C understands that network providers must recover the cost of the handset, unreasonable charges for future services that the customer will never receive is in contravention of the CPA, and Cell C believes this does not constitute a reasonable fee.
Cell C said only charges customers the outstanding handset amount when they cancel their contract. “Cell C does NOT charge customers subscription fees for the remaining contract period or any additional early termination charge.”
“In addition to the excessive charges levied against customers who wish to terminate their contracts early, tactics to delay this process have also been used by certain network providers. “
Some customers have also complained that their current service provider will only allow them to port out to Cell C once their account has been fully settled. In addition, some customers have been told that they first need to cancel their existing contract before their number will be released for porting purposes.”
“As the consumer champion, Cell C will assist customers who want to join its network but are unable to do so due to the unreasonable fees charged by their existing network providers or unfounded reasons provided by the service providers for rejecting the port requests,” said Cell C.